Wikipedia describes the subscription business model as one in which a customer must pay a recurring amount at regular intervals for access to a product or service. This model was pioneered by the publishers of books and periodicals in the 17th century, and is now used by many businesses, charities and websites.
Investors seem to believe that an assured and predictable revenue stream has value.
Consumers may find subscriptions to be convenient and potentially time savers. However, the subscription model can lead to a loss of control over your budget. A modest monthly amount may seem feasible, but may also under-emphasize the annual amount. It is also important to recognize that multiple subscriptions, such as a charity or two, one or more streaming services, perhaps an exercise plan and an almost endless list of other potential monthly obligations, can quickly dominate your monthly income.
In addition to the potential for subscription overload, canceling can be difficult.
All comments and or suggestions are welcome.
Walter J. Kirchberger, CFA