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  • If you watch movies, listen to music, or own a phone, You're probably familiar with subscriptions.

  • At least, your wallet is

  • Which, for companies, are pure gold Or, green, I guess.

  • Instead of selling you today, and tomorrow, and next week, They only need to convince

  • you once, and the money keeps coming.

  • A steady, predictable stream of revenue.

  • Because each customer is so valuable, they can focus more on keeping them than doing

  • anything and everything to get more.

  • But it's no longer just newspapers and magazines, now it's everything:

  • Music, Movies, Food, Games, Storage, Clothes, Razors, Makeup, Software, Cars, animal bones?

  • Seriously - Boneboxincludes various osteological specimens such as skulls, claws, and teeth

  • for just $24.99 a month Ooo-kay?!

  • Why does every business need to be a subscription?

  • Where does it end?

  • Let's divide subscriptions into two categories.

  • Services, like Netflix, Prime, Lootcrate, and Spotify, kinda have to be subscriptions

  • Sure, you can buy music and movies individually, but here, you get everything.

  • 40 million songs on Apple Music times the usual dollar twenty nine would be $51 million

  • dollars - so, yeah.

  • Subscription boxes, which send you new things in the mail every month, are services because

  • they're more about fun and surprise than the stuff itself.

  • And then there are products - things that could be sold, but here are rented.

  • And this is where things get hairy You don't have to be a master Googler or Binger, or

  • DuckDuckGoer, but, boy do those sound awkward, to find a million and a half people criticizing

  • this business model.

  • But it's not actually subscriptions they're angry about, nobody's complaining about

  • Netflix or Spotify, it's really this second category - especially software.

  • When companies want to reach in your wallet every month until you die for what could be

  • a simple, one-time purchase, it feels a lot like a cash grab,

  • And, sometimes, it totally is.

  • Adobe switched to a monthly fee precisely to increase profit.

  • But it's not always so simple, Even when they seem unnecessary, subscriptions can be

  • good for everyone, including you and I.

  • Companies usually don't explain why, and when they do, it's easy to see as just an

  • excuse to make more money, but there is a why.

  • And since my thing is taking complicated, controversial topics and trying to explain

  • them in too little time - let's get to it

  • The idea of a rental is nothing new, we rent apartments, and cars, and if you live in Alaska,

  • where there are still 6 Blockbusters, movies.

  • Hashtag SomeoneTellAlaskaAboutNetflix

  • But, nobody wants to rent, say, their lamp.

  • When you don't have to, why would you?

  • Owning is just simpler, and usually, cheaper.

  • Losing what we already own is especially frustrating.

  • Apps like Ulysses and Autodesk were a one-time purchase, then one day, you get an email:

  • I know you already bought this, but if you want to keep getting updates, now it costs

  • $5 a month.

  • k thanks bye.

  • Ulysses was absolutely flooded with 1 star reviews.

  • Probably the most life the Mac App Store's ever seen

  • And fifty thousand people signed a Change.org petition against Adobe.

  • Which, as we know, is very effectiveat spamming your email

  • But here's the problem: The way most people think about software just isn't realistic.

  • Remember that lamp?

  • what if every year you got this popup: Hey, you need to update to a new version of your

  • house.

  • If you don't, it'll be vulnerable to burglars.

  • Sometimes it goes smoothly, sometimes it permanently changes your wall sockets.

  • Maybe to these cute little ones from Denmark.

  • And you think, What the heck?

  • I bought that lamp and now it's suddenly incompatible with my house for reasons completely

  • beyond my control?

  • The house is your operating system, the lamp, your software.

  • Programming may seem like build once - collect profit forever, but if an app isn't updated,

  • it dies.

  • Technology just moves way too fast.

  • Knowing this, do you really want to own that lamp?

  • Truly owning software means owning all its bugs and future incompatibility.

  • Maybe your answer is yes, we'll get to that later.

  • But me, if I really depend on something, and there's a chance it'll break in a year,

  • well, I'd rather rent it from someone who maintains it.

  • Fixing bugs is like Sisyphus endlessly pushing his boulder up the mountain only for it to

  • fall back down.

  • You can't expect developers to do that forever just because you gave them 99 cents three

  • years ago.

  • You might sayObviously these apps don't need subscriptions because they did just fine

  • before” - but the truth is, they mostly didn't…

  • Big companies always find a way to earn a profit, Adobe has the power and prominence

  • to ask $53 a month, and make billions doing it.

  • But many apps, some of the best apps, are made by a single person, or a small team of

  • them.

  • They compete with 2, 3 million others, and a feeling that if you can't hold something,

  • it shouldn't cost anything.

  • So, unless you trademark the wordCandy”, seriously that actually happened, or spend

  • millions advertising, your sales look like this: A huge spike in the beginning, maybe

  • some seasonal bumps, and then, almost nothing.

  • You might make half your salary on the first day, but by the 20th or 50th, things don't

  • look so good.

  • So you have a few options:

  • You can get more customers - Do some marketing, keep updating the app, and cross your fingers.

  • Or, more accurately, pray to the App Store Gods

  • Sometimes this can work.

  • But the App Store isn't like YouTube, doing everything it can to bring audiences to your

  • videos, Right, YouTube?

  • Even a great app can get stuck in a corner and never be found.

  • And eventually, everyone who needs your app will already have it.

  • Plenty of happy customers, and no more income for you.

  • Or: if sales are so good at the beginning, just release as many paid updates as possible.

  • Again, sometimes it works.

  • But it can also be a dangerous trap, because the incentive is to release as many paid updates

  • as you can.

  • Just enough new features to make people pay, but not so many that you can't do it again

  • in a few months.

  • And sooner or later, it'll be good enough for 99% of us, but hey, gotta keep making

  • money, so you'll keep cramming in new, unnecessary features.

  • That was Microsoft Office.

  • What I ask from Word is pretty basic: when I press a key on my keyboard, I want that

  • same letter to show on my screen.

  • ahem Take notes, MacBook Pro keyboard

  • And I guess fonts and tables and images are cool too.

  • But I have absolutely zero need for 3D pie charts or smart tags, or research tools, or

  • a talking paperclip.

  • Actually, I take that last back, Clippy.

  • Office was so profitable, Microsoft kept adding, and adding, and adding, until it forgot Word

  • is, just, ya know, a place to write stuff.

  • At this point, I'll just use Google Docs, where I actually know what the buttons do.

  • For many apps, neither option is sustainable.

  • And even if you feel zero sympathy for developers, it's in your best interest to find a solution:

  • Because if you rely on an app, for your business, or hobby, or security, you want to incentivize

  • its developer to care as much as you do.

  • We can say companies should update their apps forever, and always answer support tickets,

  • or we can design a system where they actually want to.

  • For many apps, that's a subscription - taking what you would've paid upfront and handing

  • it out over time.

  • If developers want to keep getting paid, they want to keep you happy.

  • Over time, subscriptions cost more, but for that, you're guaranteed updates, and support,

  • and compatibility.

  • Plus, it rewards the apps you use the longest.

  • In some industries, these better incentives are even more desperately needed:

  • For news companies, the goal is more clicks, more views, more ads, usually the worst kind

  • of ads.

  • Clickbait only stops if clicks stop being profitable, which is the promise of subscriptions

  • like Blendle and Inkl.

  • One price for all the articles you want.

  • Or, a small micropayment per article, refunded if it turns out to be clickbait.

  • The goal is no longer to deceive you, but keep you subscribed.

  • Subscriptions give sites like Above Avalon, Kottke, and Macstories freedom to make quality

  • content on really specific topics, instead of whatever it takes to attract huge audiences.

  • It also lets you and I try things out, maybe you only need a service occasionally, in which

  • case you can subscribe only when you actually need it.

  • But because people think only of services as subscriptions, products often try to argue

  • they're actually a service.

  • Something like: “We store and sync your data, which costs us moneyBut not very

  • much.

  • All this does is create distrust.

  • Developers should be up-front: “What you're really paying for is longevity, which is in

  • everyone's best interest.”

  • But there is a catch

  • One movie ticket is an entire month of Netflix, and then some.

  • Factor in popcorn savings, and make it a lifetime

  • You could own one single album or every noise ever made on planet Earth for the price of

  • a few Cups of Coffee.

  • But when everything is the price of one or two cups of coffee, you can very quickly end

  • up buying a whole Starbucks.

  • Say you subscribe to Netflix, Amazon Prime, Spotify, Dropbox, and BlueApron.

  • That's over a hundred dollars a month.

  • Add Creative Cloud, YouTube TV, and the New York Times, and it's another hundred.

  • And this is just the beginning

  • Apple takes 30% of an app's revenue, but for long-term subscriptions, now only 15.

  • So more and more businesses are going to make use.

  • For movies alone, there's already Netflix, Amazon, Hulu, HBO, Showtime, and soon, Disney,

  • and Apple.

  • So, not everything can or should be a subscription.

  • Things you use only occasionally and don't rely on have no reason to be,

  • or should at least have another option for people who fall into that category:

  • The app Sketch finds a good balance - One upfront price, with one year of updates.

  • You can treat it like a subscription, or you can not.

  • Another solution is Bundles - one price for multiple subscriptions.

  • Setapp, for example, does this with mac applications.

  • And more companies will follow: Apple could have one for Apple Music, streaming video,

  • iCloud storage, maybe some other things.

  • Amazon Prime has shown how well this strategy can work.

  • Students get Spotify and Hulu together for less than either separately.

  • Or, how about a subscription to be a great student, on topics like physics, computer

  • science, and problem solving?

  • Brilliant helps you learn new things in a way that you actually understand, not just

  • memorize for the next test.

  • Last term I took a math class covering some differential equations, all pretty vague and

  • theoretical, but after looking at the lesson on Brilliant, I really wish I had known about

  • it.

  • It starts by explaining why the concept actually matters, and what it's all about, with visuals,

  • and questions to give you instant feedback.

  • If you answer incorrectly, Brilliant doesn't just mark your answer red and move on, it

  • helps you understand how to get it right.

  • If you're a student, or like learning new things, find a topic that peaks your interest

  • and dive in.

  • I recommend Computer Science Algorithms - it's pretty interesting, and gives you a peak at

  • how our technology works.

  • And speaking of subscriptions, it's really the ideal: premium is one low price, they

  • keep adding new topics all the time, and you have the freedom to jump around to learn exactly

  • what interests you most.

  • You can support PolyMatter by going to the link in the description - brilliant.org/Polymatter.

  • And the first 200 people to use that will get 20% off the annual premium subscription.

  • Thanks to Brilliant, and to everyone who gives it a try.

If you watch movies, listen to music, or own a phone, You're probably familiar with subscriptions.

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