Illustration by Dhabia AlMansoori

Paid Subscriptions Are The Future. Should We Be Concerned?

Is the surge of websites asking for paid subscriptions a short-lived phenomenon, or is it a warning of a bigger revolution by the tech giants?

Apr 4, 2021

On the internet, it is impossible to dodge the reminder that we have to pay to enjoy apps and websites.
There exist hundreds of paid streaming music and video services. Even news organizations, including The Wall Street Journal, The Washington Post, The New Yorker and The New York Times want subscribers. Streaming services have different TV shows and movies on their repertoire and they all ask for subscribers to pay. To enjoy the best musical experience on Spotify, Apple Music, Tidal or YouTube Music, paying is a must. Paid subscriptions are nothing new, but increasingly they seem to be the future of the internet.
Some might suggest that the recent rise of subscription services is motivated by the idea that guaranteed monthly intakes are the best solution for those that earn a living from content based services, such as journalists and artists. This is especially relevant during the Covid-19 pandemic, considering the rapid changes in consumption patterns. In fact, last year, the World Economic Forum recommended companies to switch to a subscription-based model in order to sustain themselves during this time. In a previous era, funding from advertisements would be the primary means of funding the internet economy, which led to news media and other websites competing to draw traffic to their pages. Most content on the early web was subsidized by our attention.
The attention economy is pretty much a monopoly. However, In the U.S., Google, Facebook and Amazon account for almost two out of every three dollars spent on digital advertising. Everyone else is scrounging for leftovers.
As a result, many individuals and businesses have lost faith in the ability of advertisements to subsidize the content we consume or generate real revenue for artists, authors, podcast hosts and others seeking to make a living online. Additionally, what is even more concerning, is that these big companies exchange free content and services for watching advertisements. Those "free services" also come at the expense of behavioral data, which tracks everything we do. This poses the question: Would paying for content mean that only data necessary for the best user experience — excluding demographic and personal parameters — would be extracted?
Even major record labels once hoped that Pandora, YouTube and other ad-supported online listening options would replace the money that people used to spend on CDs. That was never a possibility. Record labels have now gone all-in on subscription streaming. YouTube and Instagram stars routinely ask their followers to join subscription services such as Patreon where they can earn more money. Essentially, while Google and Facebook provide us with useful free services, they also increase the cost of every other digital service.
Nowadays, the subscription economy is considered as a currency for the relationship between the consumer and the company, organization or business and their products and services. When a customer renews a subscription, a psychological phenomenon may occur that does not occur during a one-time transaction: if the buyer is dissatisfied with the service, he or she can simply leave the subscription to expire and find another seller. Some argue that the "one-time-purchase" model historically does not provide sellers with an incentive to maintain relationships with their customers — after all, why should they care once they've received their money? We are all living in a subscription economy right now, the question is: is the subscription economy beneficial?
There are opportunities in the subscription economy though. One is an opportunity for individuals and businesses to interact directly with fans, which contributes to breaking the wall between celebrity superiority and fan inferiority. People should applaud new ideas, such as value pricing — which aims to offer products and services in bundles that help customers save money. Looking retrospectively at the rise of the internet, why does a web search engine have to be subsidized by — to put it lightly — peculiar advertisements?
Despite these benefits, the subscription economy is still likely to have significant trade-offs.
Advertising made it possible to provide news and entertainment that anyone could afford. What if we need to buy three or more subscription streaming packages to watch football, Oprah interviews and other things you used to watch on public TV for free? Subscriptions can get extremely costly extremely fast.
For decades, trading our attention for the items we needed seemed like a good deal — until the bargain soured. The biggest issue with the subscription economy is keeping the subscriber engaged. This conditions content creators of any sphere to post regularly, stay transparent, objective and relevant and regularly keep subscribers on the lookout for more. If this does not happen, the opportunity to cancel is only a click away, and thus the reasons to stay subscribed have to always outweigh the monthly withdrawal from one’s bank account. Many organizations and businesses rarely think of their customers as true clients, offering them special access to exclusive content, member-only online events, collaborations, or free merchandise, so subscribing can cultivate a relationship of mutual benefit. It is safe to assume that the person who has subscribed to journals also has a streaming media account, maybe even multiple and is also a part of a monthly book club — then why not create a partnership to connect all the dots?
The subscription economy has settled in throughout the years, and people cannot now renounce it and switch back to the advertisement economy. Therefore, we should approach the current economy within the framework of partnerships and extract its positive aspects. It is a question of vision and reaction as to how many businesses can seize the tremendous opportunities that lie ahead. Those who lean in will greatly expand their prospects through direct partnerships, while those who lean away will fail as their customers become more used to subscription relationships and expect them to be the rule, not the exception.
Stefan Mitikj is a staff writer. Email him at
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