More and more, our lives are wrapped around subscriptions, and that’s not just in online media.
The 20th-century economy was rooted in manufacturing: companies were focused squarely on making and shipping as many tangible goods as possible. Car companies, for example, were measured on how many cars they ship in a quarter.
In contrast, modern companies focus on their customers, and focus on building long-term relationships with customers through a set of services. Zipcar, for example, reports on how many members it has, not how many cars it owns. And with these long-term relationships come a recurring, predictable revenue stream. That is the subscription economy.
— Tien Tzuo, CEO of Zuora on how companies today focus on long-term relationships with customers through subscriptions and provision of services, over the one-time sale of a product. Tzuo says that the magazine industry is more familiar than anyone on the economics of subscriptions, but 100 percent of online content publishing models dependent upon display ads are unsustainable.