On subscriptions… with ads

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So I was reading an entry Manu Moreale wrote about subscriptions, specially streaming services ones, and I have to say that I completely agree with his general opinion.

Subscriptions are getting a lot more expensive these days. So much so that I have decided to calculate how much I’m personally spending with them. And although I don’t have these figures quite ready now and this will make for a future post, there are some highlights from his post I’d like to comment.

The issue with streaming platforms—but also with subscriptions in general—is that there’s a finite amount of people who are going to subscribe to a specific service. Which is fine if the goal is to run a sustainable business. As long as you’re pulling in more money that you’re spending, you’re good to go.

This is such a simple truth that it is worth repeating it.

For any given service, the amount of people subscribing to it will eventually come to a maximum. Be it because of the competition that’ll make some people choose alternatives, be it because every consumer possible has already been reached and subscribed to the service, or anything else. There’s really nothing wrong with it, as long as it’s a sustainable business model one is after, as Manu says. When I was young, for instance, I remember my parents subscribing to a monthly Disney comic books package, which arrived at home for my reading. I didn’t think about it at the time, but it’s certain it wasn’t every family in Brazil, where I live, that subscribed to the same package, or to any package at all, and yet the publishing house business model survived for years and years, relying on who had interest in the service. It lasted until the end of the comic books heyday around here.

But the problem, as Manu puts it, is that companies aren’t after sustainable business models. Growth is their goal, even if they cannot grow forever. And as they cannot grow forever, they start doing weird things like charging extra fees for when your family members are watching something using your account but not in your residence’s address (yes, Netflix, I’m looking at you). Or they increase their prices. Or both — not to mention when prices increase while the service offer decreases, like when a plan that used to offer 4K streaming starts to offer only FHD streaming.

There’s also another option, and it’s the one we’re seeing slowly creeping in at the moment: subscriptions plus advertising. Because you know what’s better than getting your money? Getting your money AND advertisers’ money at the same time.

This is the worst. And yet, Manu is as right as it gets. Because… why not? Here in Brazil, Netflix recently started offering plans with ads. They are cheaper, so it kind of justifies the ads (at a rate of 4 to 5 minutes of advertisement every 60 minutes), but if tomorrow or next week Netflix, or HBO, or Disney, or whoever decides to change their mind and include ads during the programming, who could stop them?

And then, there would you have it. Enshittification meets streaming services as much as it is already the case with retail giants such as Amazon.

I wish I could change the channel.

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