Beaten into subscription: why the world has switched from owning to leasing
From razors to music, this model has firms cashing in, although analysts doubt it’s sustainable
“The faster earnings fall, the better off we are,” Mark Garrett told his Wall Street audience. Even in 2011, so soon after the recession, it was an unusual statement to hear from the chief financial officer of Adobe.
Still, Garrett believed that Adobe’s model of selling software to people for thousands of rand was stagnating. The new plan was to switch to leasing its products out for a monthly subscription, meaning a large if temporary fall in revenue.
Shares plunged, but Adobe thrived, and today the allure of the subscription shines brighter than ever as consumers in their millions embrace a range of services paid for via a monthly direct debit...