Why everything is a subscription
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- čas přidán 29. 04. 2019
- Selling a gadget isn’t enough anymore. Creators need to find a way to keep revenue coming in, even after they sell a device. Companies like Peloton sell the hardware, but also a service to go along with it. Ashley Carman reports on recurring revenue and subscription services, and why they might be the key to keeping hardware businesses afloat.
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What’s your favorite subscription service?
Netflix and Spotify
The Verge people already rent phones. Leasing phones has been going on for around 3 years or more now at sprint and tmobile
Sun Basket
... I don't sub
Subscription services are starting to frighten me.
But people - at least my friends and I, are sick of subscriptions for everything =/.
only subscribe to something that are really have a meaningful value for your life.
It doesnt have to be a recurring subscription. Take the coffe pods for example, youre not paying a monthly fee drink coffee, but you need buy more pods everytime you want to drink It, or else your coffe maker its useless
Surely everything you buy regularly is the same as a subscription?
No no no this is dystopia I do not want to be spending a little bit(which adds up fast and your paying lots more then you think) for the rest of my life on things that I need in order to live my life. What happened to owning things now we just rent.
I second you..
That closing statement was an actual nightmare idea. "wow, being permanently indebted to corporate overlords and paying them constantly for the privelege of living sure would be great."
It feels like you are trying to talk me into paying more for less.
Sounds like subscriptions are only good for investors and shareholders not the customers. Greedy corporate swine
There not greedy, it an very smart way to keep revenue going. If you pay, then you give in. That be your fault. It what makes captialism great. You get choices. Real greed is randomness being exploited so we spend so we can win. Fun but not healthy. Unless you lose all the time then well, you did yourself a favor, cough cough gambling.
@@5DollarsUp What you think makes capitalism great is what I see as its absolutely worst quality.
I can see how subscription is great for some companies and even a necessity for a couple of them too, Software in particular is a place where subscription can be a really great thing (i do have an adobe subscription myself). It works there because it allows the customer to not have to keep buying the software over and over again just to get the latest features that might be great for productivity (or not) without having a periodic interval where all the money one makes is sunk into something at great risk. For the company they get a steady income too so it is a true win/win.
But then you got these coffeemachines that uses capsules. Worst idea ever. Why?
Because lets say that these capsules was all there was, no more filtermade coffee that you brew and toss out the leftovers after. Those capsules are good for maybe 2-3 cups, but generally most people throw them out after one because that is how they where intended in most cases. That means the consumer probably pays a great deal more per cup compared to the can of coffee they can get from a regular machine with filter and where you decide the strength. In other wors, it favors greed and that is always a bad thing.
For this reason alone I am very glad that I do not drink all that much coffee (i like it, but as little as i drink all i need is a small coffee press)
The only reason this is becoming more popular is because they can offer some unique items that generally are harder to make at home without a bigger more expensive coffee machine that can steam the milk and all that stuff. But I would not call it a win/win situation just because of that.
I agree with the first sentence, but they could also call you greedy for expecting goods and services for cheap, we're not entitled to that (I don't think they're necessarily being greedy -> some businesses might not be able to survive or make a reasonable profit without this, and I don't think you're being greedy either, some services are probably more expensive than they should be).
It's not far off the model for gaming consoles. Traditionally consoles (except Nintendo's) were sold at a loss and they make their money on the games. It's a model that totally works for the consumer as it brings the console price down to one that is affordable to mostly everyone (further bringing the price down due to economies of scale) and then you pay-as-you go.
For mass-market products selling-outright will always be the way-to-go but for somewhat niche, expensive products a subscription model can be a win for everyone.
@@zig131 Fair enough, then that's information that may not be translated to the consumer correctly. They may just see the initial cost and wonder why they need to pay more for subscriptions
capitalists: "In communism you wont own anything."
also capitalists: "This is great you wont own anything."
ikr lol funny but sad
I used to think that I liked capitalism cuz I could buy my stuff and own them, but now like what even man
One is q choice the other there are no choice.
More like: also capitalists "this is great, you wont own anything, but WE own everything"
Capitalism is just a fancy name for Oligarchy.
@@joelw2413 until you deal with software and suddenly, microsoft office is a subscription! adobe acrobat is a subscription! autocad is a subscription! end your subscription, you lose all of your software, but nice try.
The line "I might soon live in a world where I don't own anything" , in a system where ownership is literally power, is dystopian to me.
What I find interesting that the video did **not** address is that a lot of consumers absolutely hate the idea of required functionality subscriptions, as in, if you stop paying, the device or service will stop working. Myself (and probably others) are willing to pay a premium for a one-time all-in purchase, as long as it's not unreasonably high vs. the subscription offerings.
I don't think they need to mention it because I'm pretty sure all consumers feel the same
People love the *idea* of paying a premium to own stuff, they just don't actually like the paying part. That's the problem.
I agree except in the case of software I haven't used. But I've never understood office 365. Why anyone would agree to pay $10/month in perpetuity for software that's been around almost since computing began blows my mind
I HATE subscriptions! Who has money to throw at all the services that are bombarding us all the time these days? It is just a huge rip-off.
same
i hate subscriptions, if this goes on you have to pay a monthly fee for everything..
it's good for companies. but i can't afford a lot already..
This is the exact reason why cable companies are struggling right now.
john pardon wow!!! How poor peasant are you!
I can afford subscriptions
Netflix
Hulu
CZcams Red
Amazon Prime
Adobe
Microsoft 365
VASA (Gym Membership)
Costco
Sam’s
you can afford everything if you steal and pirate it
@@seemysight yeah i have popcorntime. It's pretty sweet.
How far will this subscription idea go. A lot farther than I would like, I feel.
Eventually you'll have to rent everything instead of owning anything. 😒
@@user-vn7ce5ig1z some service like telecommunications cable TV, and Internet provider do give free hardware.
I mean it's interesting that a sharing economy basically works like feudalism.
People rent their stuff to save money short term. And sure renting something short-term like drills or a truck makes sense.
But when only some own things and the others rent from them and pay money to use it short term you are going to be depend on them long-term.
A sharing econ works if there is an equal distribution of goods but in reality there just isn't.
Jonathan B
This is so disgusting. Yet it’s being celebrated. There are only a few services that are genuinely subscription required. Everything else is extractive and downright exploitation in order to continue to support an increasingly financialized economy.
Infinite growth is a myth that’s increasingly clashing with reality. “Innovations” like this only serves as a stopgap.
It drives innovation and better products than any other alternative. It's all about recurring revenue.
This video glorifies absolute grifters and con-artists. "it works better for both sides" is an insulting lie.
"Both sides" means Investor and Company. Nothing to do with the customer.
Adobe needs to continue to improve their software constantly - so a recurring revenue makes more sense
The only people this disadvantages are the people who still use Windows XP and Photoshop 3. The people who want to buy once and use forever. Technology just doesn't work at that pace anymore.
The fact is that despite the sometimes low cost of entry afforded by the subscription model, the customer almost always loses in the long run thanks to ever-rising subscription costs. Then there's the corporate monopolies which essentially eliminate consumer choice and prevent any future competitors other than fellow conglomerates. Meanwhile, these services track everything they possibly can about you in order to sell your personal data or better take advantage of you. Many of these services also make more money off of you the longer you interface with their platform each day, so they optimize their platforms to essentially addict users. If you think it's hard to quit using this or that app right now, imagine how much harder it will be in ten years from now, after a decade of using machine learning, behavioral psychology and data harvesting to target your time and attention.
@@GIPvideos
Shaddup
I would have liked to see a much more critical look on this move to subscription models. I'm really distrustful of not owning what I'm buying. There is a reason ppl want to own a home and not rent their whole life. I can't imagine that renting everything I currently own would make my life easier or cheaper. I see this as mostly a change that benefits that companies and not the user. Sure, you can get updates and more support, but updates aren't always guaranteed, and if something needs updates, you don't really know what you're renting. And your rights when it comes to what you want to do with that device or software are reduced.
Agree. This is an interesting and important topic but the reporting approach taken by The Verge here seems far too credulous and uncritical.
It not how cheap or not cheap since we don't know financial situation of each person. Most importantly they had all kind of business plan for each price point.
M. L. Hunt the difference is real estate tends to go up in value, while most gadgets don't.
This isn't meant to be biased.
No to mention how you're reliant on their customer service, which is often terrible or over-priced. Back in the day you could have your stuff fixed by anyone anywhere for a decent price, now it's all authorised resellers and technicians.
I find this kind of "subscription-thinking" revolting.
I understand small startups like sphero need to go down this route in order to survive, but it's an inherent problem with the way things work nowadays. Especially if subscriptions on regular items are aimed at private persons, rather than companies and businesses.
That exercise bike reminds me of an episode of black mirror
I just re-watched that a couple of nights ago, such a good episode. The difference is in Black Mirror at least they get 'paid' for cycling - in Peleton you're paying $40 a month for the privilege!
i too felt same.
@@IgWannA2 what's the episode name
@@daviddiveroli9331
Fifteen Million Merits
I loved that episode.
I am a simple man, I see monthly subscription fee, I buy something else :/ A tiny protest from a non-important nobody
Consumerism at its worst. The part about 8:41 explains a lot - nobody seems to do "slow business" now, we all expect magical growth but life usually isn't magically growing, it takes time and effort to make great things..
It also shows that people are more inclined to buy something which has an aspect of community, like the exercise bike. Because of all this technology, we're losing a lot of a sense of community, ironic isn't it
Yeah. Slow growth business will have a hell of a time trying to compete with Subscription ("magical") growth companies.
Things have changed nowdays if you don't act fast then you may find copy cats Taking on your idea...
Not toenrion how a lot of this is just gadgets, non-essentials. Can't believe a company selling interactive cycles is worth 8 billion bucks...
Planned obsolescence has a close friend... And it's name is monthly subscription.
Dishonest marketing, planned obsolescence, subscriptions, microtransactions... The cancers multiply.
Appliances that break down every 2 years can be considered a subscription. You need to replace iPhone every 2 years because it breaks down and you can't repair it?? It's also a subscription.
I'm really depressed now after watching this.
Same
Stephanie McKeon are you diagnosed with depression? If not, say you’re sad, not depressed thanks
Thanks, but I used the correct word.
I dont like the idea of "lifetime subscription"
Ditto. Nothing is going to send me "off the grid" faster than being tethered to a payment in perpetuity
Whose lifetime tho? Because any company could be gone in a year you just never know
They're selling it by not selling it
They're renting/leasing it but calling it a sale. In other words, lying. 😒
@@user-vn7ce5ig1z You're buying but not owning.
Give em' the razor and sell them the blades was Schick's business model from the start. In the 40s. It's nothing new, but it has expanded. and no one should be surprised about that. The real reason this modern model will fail is people have only so much to spend. Eventually your subscription product will get cut from their budget. See also; cable companies.
The only reason that cable companies might be able to survive is because streaming services are beginning to kill each other by branching out
there is a small but important difference.
I will buy a new pack of blades if my old run out and not every 4 weeks bc otherwise my license would time out
Printers
The problem is thinking that all companies can and should grow indefinitely. Some companies can some cant
nothing should grow indefinitely. the world has limited resources the more you take the less there is for others and you eventually have to resort to stealing. Even Bezos admits that limitless growth-the growth that made him the richest man in the world-is incompatible with a habitable earth.
I agree, though tell that to modern business
Our UNIVERSE is finite. A company can sell every elementary particle in the Universe for $100 each. They can only make $10^90 max. It may sound a lot but it's still finite. Capitalism demand infinite growth and that means the end goal is $∞. Our Universe don't have enough for $∞.
Imagine buying a spoon and having to pay monthly otherwise you cannot use that spoon
Apple already did this with their iPhones. Late payment means having your phone bricked... and combined with the anti-repair mindset from Apple, you may as well have to buy a new iPhone with yet another subscription payment, and repeat the cycle all over again, ad mortem.
I find it strange that The Verge made no attempt to criticize or question the subscription trend.
Personally I don't think I would ever commit to a piece of hardware that 100% required the internet/subscription to function and would cease functioning if my subscription or their servers went down.
Subscriptions have gotten out of hand.
subscription = Renting.
buying = owning.
wake up people
Subscription models are great for some things. But I also saw this video with a bit of... nostalgia I think. I am a little bit fearing that moment where you can just buy something once and have the full experience. Sure having updates and latest and greatest is great, but sometimes. Especially for hardware, sometimes you don't need or even want the latest and greatest. I think one of the best examples I can think of is the Apple Ipod Classic. I know a lot of people still looking for that tank of an iPod, with it's 250Gb+ storage, who don't want to pay for streaming.
I'm not a hardware entrepreneur, so I might be wrong, but I do think there's a place for buy only once products. I'm a little scared and doubtful when I see so many things turning to subscription based. Video games are a great example too. Now the industry is being sort of split between AAA that make 'games as a service' and indies where you buy the game once.
Still, great video, really appreciate what you guys are doing with this series!
I think you're right. Moreover there's a serious ecological price to pay for constantly throwing out old hardware. Even recycling it is incredibly destructive.
Agree with you, Maxime, feel the same. But with the iPod you need to pay for music (unless you a have one eye and an eyepatch). How much money it takes to buy 250 Gb of mp3 music?
So I am a hardware creator and entrepreneur. Other wise known as a manufacturer in old world speak. This is how you make the hardware game work. You innovate in style, function and value. Sounds like hard work? Yeah tell me about it. Make it good and your cost of customer acquisition goes way down. Its called word of mouth. It works. If your product isn't basic as S#!t to copy it works. In the beginning, the iPhone was doing all three. iPhone 3,4,5,6 all had major leaps in style, function and value. Then it stopped. However the buy once and never buy again model is limited by how many customers you can reach that other people can't because you are unique. Like tesla. Lets face it what comes close to tesla. Nothing... by a country mile. This is where the buy it once model works great. The part they are not really talking about in the video is how the subscription model can offer value to people. A $2000 item on a monthly subscription of $45 a month looks awesome. So in fact what your really doing is accelerating you market saturation. The peloton bike is great if you were going to spin classes but if you liked to ride on the road it is just stupid. The subscription is value to the spin class rider and its an increase in convenience. This was a minor point in this video. Value to the client. This video was about value to the VC. A business is always always always floated by market interest not investor interest. If your investor interest is great than your market interest then what you have is a sophisticated scam/bubble that has not burst yet. You want an example.... Magic leap. Investors love it. customers are struggling to find a use for it and struggling to make it work. This will end in tears. I promise you. Compare it to Tesla. The largest pre-order in the history of manufacturing and they didn't even have a full prototype when that happened. Just the promise of it. If you compare those two you will understand what this post was all about.
$40/month to bike in your own house. Pelaton is the peak of Late Capitalism. They will fail.
They won't though
I expect a lot of these companies to go under when the next tech crash happens.
You have to look at it this way, its like a personal trainer for $40, so it's actually affordable.
With subscriptions, you end paying more in the long term than with a one time upfront cost. They know this.
I hate "recurring revenue," micro transactions and subscription services.
It's designed like drug dealing and casinos.
I’d rather pay more for something up front.
Same, I rather pay for a product in full once and be done with it
I disagree with you ... selling hardware is enough to make money... subscription services exist because companies are greedy they want to keep milking their customers
ishmam rahman I Agree with this statement but it’s “their”.
Yeah, or rather investors who want to see companies grow really fast.
But you need to make ALL the money! All of it! Anything less is unsatisfactory, especially to shareholders.
nope , subscription is better option , they will give us more cheap price than owning the software....
Exactly. How did companies make a profit in the past without subscription models for hardware, but apparently they can't today? Greedy companies want to grow infinitely, but our incomes don't grow infinitely, so it's unsustainable.
10:30 - Not owning things you buy is _not_ a good thing. 😒 You rent your clothes? 🤨 This line sounds very shill-y. ¬_¬
10:43 - Society has survived for thousands of years with the traditional buy-it-and-you-own it model. 🙄
- I would rent clothes and change them when they are worn out
- Society survived without proper medicine for centuries, what does that prove?
@@fedirkryvyi Yeah, that works for the low quality stuff since they're likely going to get worn out in a year or two of normal wear anyways. Who the hell wants to rent a quality set of clothes, that is meant to last 5-10 years? The whole reason behind buying quality clothing such as denim, is so that the high upfront cost is amortized over the years of ownership.
@@rousseau327 Yeh but fashion changes quickly, obviously a suit is gonna take a long time before it's unfashionable but day to day clothes come in and out of fashion so fast people might want to rent them instead. you can stay on top of the fashion curve without having to shell out for "quality items" that last for 10 years when you stop wearing them after 1 or 2 anyway.
@@Aguycalledmax That's true if we're talking about fashion, if I were trying to keep up with the latest trends, I'd say renting might be a good choice, financially.
But there are lots of things are are quite standard regardless of the fashion that is in season, such as quality jeans, t-shirts, shoes, crewnecks, etc. For the people who don't really care about keeping up with the latest trends, and just want to look good in a "normal" way, yet still want clothes that last, the subscription model for clothes just doesn't make much sense.
@@Aguycalledmax fashion itself is one of the original "planned obsolescence" industries. If you don't buy into the hype of believing you have to be on trend with each season's new designs, you're freed from that albatross.
As long as people continue shelling out a lot of money for things they don't own (and in many cases don't need) the subscription model will continue growing.
This is rough on small businesses as well. The tools we use for everything from inventory management to accounting to Microsoft Office have been increasingly shifting from a single-purchase license to SaaS (Software as a Service - AKA subscriptions). And they are *always, always, always* significantly more costly. Our business is literally running on antiquated software to manage our inventory because, sorry, we cannot justify a 400% annual price hike so our locally-hosted inventory system can move to a cloud-based subscription service when we deal in a ruthlessly price-competitive industry and ever narrower margins. But that also means that we miss out on the latest developments which could help us operate more efficiently and cut costs. Eventually we will have no choice but to give in to the SaaS model for all of the services we depend on, and when that happens we're going to have to find a way to extract more revenue from our customers. We are far from being alone in this situation. The end result will always be higher prices for consumer, less competitive viability for small businesses, and big business taking a larger share of the market.
This isn't a real problem. Recurrent user spending is a concept created to exploit consumers.
You only have to look at the comments to see that the general consensus is that customers don't like the subscription model. It will work for a while, but as more and more companies want to tie you in, people will rebel and I am sure they already are starting to.
I hated it when Adobe introduced a subscription model. I never started a subscription with them, instead I use a version of their software before they switched over. It still works just fine and I am effectively giving them the middle finger! I also moved away from Adobe Lightroom to an alternative where I could buy the software outright. Lightroom was dog slow anyway!
I don't even have a music subscription anymore because I just wasn't using it enough, but I was still paying for it every month exactly the same!!
Companies need to stop being so greedy, people don't have bottomless pockets! Just look at how mobile phone prices have gone up and up with innovation that hasn't matched the price tag.
8:10 I prefer normal coffee beans, because there are cheaper & more environment friendly than coffee capsules =D
People want to buy one product that will last them a long time.
Subscription only work if they offer a lot more value than their worth.
Next thing you know we'll be renting iPhones instead.
Subscription are meant to be convenient, once they stop being that people start looking elsewhere. ie Netflix/hulu/Disney
SIKKY Phones were originally set up as rental (government subsidized) hardware until T-Mobile dropped that practice in 2014.
In many ways you are already renting your phone. Support for your iPhone ends after about 5 years. After that time you will no longer be able to update the OS and a lot of apps, especially cloud based ones, will stop working. Yes your phone will continue to work as a web browser, for text messaging and as a phone but that's probably not the reason why you bought an $800 smart phone.
Thomas Hofmann thats fine cause by that time the phone won’t be that great anyway ideally you want to keep a phone for 5 years, avoid updating too many apps and make sure that phone has plenty of space and power then buy another good phone and keep for 5 years, you can buy refurbished to get lower prices if you buy a refurbished iphone xs max it will last 5 years and never have a problem or you can just buy cheaper androids they wont last 5 years
TBH leasing a phone is not a bad idea. Batteries only last a few years, security updates only last a few years, features become obsolete quickly. Leasing is becoming very big with expensive smartphones, at the end of the day, if its a product you won't use forever, there isn't much reason to buy it.
Not that i support subscription services, i cancelled all my video subscriptions after the media companies left netflix to start their own. Back to pirating for me i'm not going to spend 8x$12 per month to watch the same content i used to access for $12 a month.
If a hardware device has a subscription to it. I won't buy it. Most of the tech that I think looks cool and happens to have a subscription attached to it are usually things that I might use once or twice a year. I pay for Pandora, but that's something that I use from 1 to 10 hours daily.
Apple soon will be selling iDevices on a subscription basis. Even older iPhones are essentially a subscription because they break down every few short years and it's irreparable, prompting you to buy new ones only for it to break down again. Subscription-based economy is highly related to planned Obsolescence.
Printers have been using this model for years
But still, I am not gonna buy a coffee maker that uses pods, or anything that requires subscription as long as I have the option not to
Meanwhile, I'm trying my damndest to get *OFF* recurring payments. I own my house (well, close enough - have 3 payments left on my mortgage,) I own all my cars outright, I don't rent any physical devices on an ongoing basis. Right now, my "ongoing payments" are my house utilities (water/sewer, electric, natural gas,) insurance on physical things (car, homeowners, that are effectively required,) "optional but not really optional in the modern world" utilities (cell phone, internet - notably *NO* cable/satellite TV,) and a couple internet services, none of which I consider "can't live without," and will frequently cancel for months or years (currently it's Netflix, Spotify, and HBO Now - although HBO Now will get cancelled as soon as Game of Thrones is done; and we just cancelled Hulu's ad-free now that Spotify includes Hulu ad-sponsored; both of which are for the teenager, not my spouse and I. And as it's getting to be Summer, we'll probably cancel Netflix, too.)
And we're currently looking at building a new house or remodeling our current one significantly (which, yes, will go back to having a mortgage for 10-15 years,) which would remove natural gas, and add solar panels and battery storage - eliminating one utility, and possibly negating a second.
When someone figures out how to subscription bread the world is toast.
Hope you made that up~ it's a gud one.
People need to wake up and realize they're being ripped off.
The companies that pursue this business model deserve to go under.
This video has been a pro in subscription. I don't like subscriptions. Some things are good to rent but owning it is always better
10:31 "I've always wondered what'd it be like to live in a world where I don't own anything"
Well, well, let me introduce you to my good friend, Karl Marx
zer0 that was indeed a dangerous wish
Honestly, i think you mean feudalism. Something tells me large corporations owning the product seems as Karl Marx's kryptonite.
@@cityscapes4ever I'm saying companies own nothing at all, the central government does as Karl Marx says
Technically we don't....socialrity.. It is ours.
Socialism actually allows the workers to own the means of production. That's right, OWN something. These modern capitalists want to deny you that. And your problem is Marx?
So basically, you have to have a stable job to be a consumer these days.
in a world where stable jobs are harder and harder to find
This is an outline for the end of capitalism. Nothing made, services distributed, till the next crash.
It's missing the spin where how VC valuation is driving this more than anything, not because customers want it. The interviews kind of spell this out between the lines...
Absolutely. It's greed, pure and simple. Subscription models are not in the interests of consumers. How some of these companies have managed to dupe consumers into paying a subscription when they acquire a 'gadget' is beyond me. Ultimately, I think it will fail. People are going to get sick and tired of paying subscriptions for everything they use.
Exactly
@@richie1326 It's not that simple--some business can make sense of subscriptions, but sometimes for hardware startups it just make no sense at all. And all because the business models for VCs are to drive up valuation and exit via someone else acquiring the business. You're right, it's greed, but it's also greed at the expense of the startups themselves, let alone any consumer interests.
These type of companies deserve to have their propietry devices ripped off by China, where they will get rid of the subscription models.
More public funding for Open Source projects
You guys are playing this up as this really awesome "Woo! Future" kind of thing, but the whole idea of everything becoming a subscription sounds horrible to me.
TL;DR because venture capitalists have a lot of power in our society and they are pushing for it...
I have ZERO subscriptions and I’m gonna keep it that way. I went from Adobe over to affinity for all my graphic design once adobe forced a subscription model. One off payment. You own the program. And it’s every bit as competent.
This video made me EXTREMELY SAD about everything. Black Mirror incoming.
Reality is worse than any work of fiction.
Who the hell rents clothing? Is that some hipster city slicker sort of thing?
“What it boils down to is sapping consumers of their money so we can get more of it.”
The coffee maker example remind me of a machine call “Juicero”.... great business model lol
Im getting really sick of that, especially for apps. It used to be a pay once kinda deal and now they are all "free"
I recently saw a nice model where you could just buy what ever you wanted extra once, so it's not all or nothing but more individual and you can expand whenever you want to instead of being forced to pay monthly
I already have 3 subscription for streaming (Netflix and 2 others), 2 subscriptions for music , subscription for furniture, 2 subscriptions on cabs, and maybe 1 or 2 more that I can't recall. This is getting out of hand really fast!
Why do you need a 2 subscriptions for music? WTF is a furniture subscription?
All I know, is on the 1st/2nd of every month, I get to watch every single bit of money I worked hard for the month before go *POOF* one sms at a time.
Casper should have a subscription model on their beds. $1.99 / 40 winks
IN soviet Russia, you don't acquire a product, the product acquires you!
I feel like we need to change up this joke structure to be "in capitalist America..."
I really like it when you dig into the business models and economic rationales of the tech industry, please keep producing more awesome content like this :)
@@joeyC27 I understand if you find the idea of a subscription-based economy upsetting and I myself am skeptical as well towards some of these new platforms and businesses. However, to better understand what's going on and why this trend is happening, it's great if quality content like this is produced! On the other hand, I do agree with you that this series might benefit from taking a broader look at where current (tech) business developments might lead society as a whole and whether we all stand to gain from this.
The biggest problem with subscription based businesses is that they will soon be back to square one because we reached subscription saturation. At the end of the day be it in business or personal live there is only so much money available. Once you hit the ceiling people will start making choices.
The Adobe subscription model I think is a very good example. When they first started they won over customers because it was slightly cheaper to do the subscription than to regularly pay the upgrade price. However since then the cost of Adobes subscription has nearly quadrupled. It now almost costs as much per year to subscribe then it cost in the past to buy the product outright. What's worse once you stop subscribing you can no longer access all the assets you created with the software subscription due to zero backward compatibility. To top it all off Adobe has been adding feature after feature to it's product line up without focusing on stability or considering wether users actually need those new features. Every update brings new bugs and problems and usability gets worse.
For many smaller design studios the pricing has reached a critical level were they rather learn a new product that is purchased outright (often for the same of a single monthly subscription payment) rather than continue buying into a subscription model. I think the same will happen for other subscription services unless they offer something unique such as the Sphero.
Constant cash flow from my wallet to already megalithic monstrous corporate Vampires. Sounds lovely.
basically, companies are literally fighting to own their customers. Greed! Greed!! Greed!!.
great video! Worth subscribing.
..wait
Excuse me, are you not paying for CZcams red or giving some patreon money to them? You're so old-school!
You Got me. Gud work.
I prefer to use a digital music player for my listening pleasure, packed with all the music I could ever want. Why would I pay for a music streaming service?
The trickest thing for a hardware developer to suddenly flip the script and become a subscription service (supported by software that isnt their expertise) is they run into repeating the same mistakes other subscription services have done before by not being fully aware of the risks and doing the full due diligence in a rush to market. For example Peloton's subscription service is currently being sued over dispute over music rights and unpaid royalties... an issue Spotify, Pandora, and Tidal have all struggled with and resolved.
Are you really sure it's not a case of "just get to market first and worry about legal later"? As a consumer, I am not a fan of it. But as a pragmatist, one has to admit this isn't the worst approach. You get to market, corner the market, make enough money and deal with the legal consequences later.
@@Tundey Yes, but rushing to market with out doing due diiligence is the major risk that could end everything, why repeat the same mistake someone else already made... one legal action could kneecap you at the wrong moment, if your trying to borrow capital or have your capital tied up in manufacturing or staff.
The rental comparison is a bad analogy. Renting is not the same as subscriptions. Renting's is a limited time or one-off kind of usage. Subscriptions are recurring monthly charges.
Final Episode!?! I'm loving this series, hope there is a season 2 soon!
Really appreciating this kind of content which we probably won't be able to find on net..... looking forward for more.
Having a subscription for everything is dub, easiest way to go broke.
Love this sort of content. Keep it up verge.
0:49 "were able to own the software" - NOPE, we just had long-term license (usually revocable as per EULA that only some read).
why get their money once when you can get it ONCE A MONTH?! 😉
Thanks for these videos. Please don't let the next one be the last. Please do some more videos. This is the first time this information isn't boring but engaging.
I'd prefer quality over quantity!
I still use the 2010 version of MS Word because I don't want to subscribe to use it.
Screw it. I used 2007 version. Already a major improvement having grown up with MS Office 2003.
Nope Microsoft. I don't want to pay monthly fee to use your softwares. Just gimme the product for one off payment and leave me alone.
Thank you so much for doing this series Ashley. I'm really loving it. Learning so much!
I'd like to see some investigation of the drawbacks. For example, in this video they mention coffee pods, among other upgrades that are basically unnecessary or redundant. The content-serving exercise bike could just as easily be a stationary bike and a video library you access from your existing laptop or TV. So it would seem that there's an environmental cost associated with these ongoing revenue streams.
Then there's the question of whether you need everything that you are getting in a subscription. If you're getting things you don't use or need, then there's an inefficiency. When that inefficiency is minor, it might not be a big deal. If everything goes to a subscription service, how much inefficiency are we talking about? (And, yes, I know that there may be efficiencies as well, like with car sharing-- there are a huge number of very, very different businesses that fit into the ongoing revenue category.)
Lastly, as a customer, I wonder about the ways in which subscriptions allow corporations to hide the value of what is being received by the customer in relation to the price paid. They don't talk about this in the video, painting it as a positive for all parties. But many subscriptions are not a very good value. What they offer, instead, is a "package deal" that promises to simplify modern life. Perhaps we should look at making modern life better in a more substantial way, so that people aren't so overwhelmed by minutia that they have to rely on companies to serve them everything they supposedly want in a neat little package.
here's a thought: if you dont own the hardware then the government can easily demand the company that rents you the hardware to give them access and control over everything you depend on to live your life
I don’t like monthly subscriptions! I prefer to minimise my monthly expenditure
Thanks! This series is my favourite from the Verge.
I'm still mad about Adobe being subscription based!
Why are you stopping these episode? This is your BEST SEOASON SO FAR! Again the subscription and hooking up model!
If I see subscription, I find an alternative without it. Might be plenty of millionaires in Silicon Valley, but not globally.
I don't think sub-based model works for every product, and shouldn't be the default business model. Yes netflix/spotify works but I don't think many people will pay for a sub-based running machine, for instance.
Absolute vampiric greed
It's always been such a delight to watch this anchor present something.. her dialogue delivery and quality of the content.. everything is perfect.
when you get the phone on monthly payments through carriers with an option to upgrade it is essentially a lease. You have to pay extra upfront or after two years to buy out the device all together.
This series is so fascinating. I love it.
Love these videos! Thanks for making them :)
Those of us who amassed a library of videos, CDs, vinyl, etc and the dedicated hardware players will be envied in our golden years when we pay $0 for endless hours for enjoyment and will never be outdated.
Such nice content!!
As more people feel the need for more subscriptions, more money is needed. This will have an impact on lower income folks. That then puts pressure on businesses to pay more. That then gets passed onto the consumer. So too many subscriptions will increase inflation.
"I've always wondered what it would be like to live in a world where I don't own anything..."
Marx: Do I mean nothing to you
Great series, I have really enjoyed this. Great presentation, and some very interesting insights. Very disappointed that the next episode is the final. Please do loads more stuff. Plenty of room to dial up the 'skepticism', especially when it's informed and intelligent.
There is so much in the tech scene that needs a critical eye....