Sault Blog

Subscription services are taking over your life by seizing your bank account. This phenomenon refers to the growing trend of businesses transitioning to a model where customers are charged a recurring fee for access to products or services instead of making a one-time payment. How pervasive has this predatory business practice become: you only have to look at your monthly bank chequing account to find the increasing number of subscription services you pay for. This is called the own-nothing and pay forever business model.

A bank account withdrawal monthly shocker is our residential property municipal tax monthly payment. Our residential, municipal tax bill is so large now that the average family must use the monthly subscription service payment method to tackle it. Gone is the one-time bill payment or three-instalment payment; in comes the monthly subscription service charge.

What was once a meeker $15 monthly gas hot water tank rental charge has become a subscription service for the furnace, air conditioner, and hot water tank. HVAC companies shifted selling the furnace, air conditioner, and hot water tank as a one-time payment to a subscription service monthly rental charge. For example, a $10,000 gas furnace and air conditioner replacement cost is switched to a monthly subscription service charge of $200 in perpetuity. There is no sunset clause on these contracts that locks in the homeowner for decades; there is a contract exit penalty charge to exit the contract. The homeowner will pay 300 percent more for their HVAC system through the lifetime of this extended obligation compared to an initial purchase. I do not see any Federal or Provincial laws regulating this industry. This is precisely the definition of own-nothing and pay forever business model.

If you don’t want to shop or prepare dinner mise en place (dinner prep), that’s no problem. The popularity of meal kits delivered right to your door represents a convenient, cheap way to feed your family. The meal kit industry highlights the sinister way of getting you hooked on the convenience of dinner preparation subscription service. Initially, the meal kits are priced far below retail, with many meals included gratis. As the initial subscription time elapses, the subscription service constantly increases in price. It’s difficult to cancel the meal preparation service after you have become accustomed to its convenience and quality.

The technology and entertainment businesses take first place as the instigators of the subscription service business model. Software programs are no longer for sale, whether it is basic word-processing or new AI-driven specialty programs; gone are the software programs that you pay for and own; in comes the monthly subscription service to fund the insatiable magnificent-seven software Wall Street Technology behemoths. Netflix, the legendary entertainment disrupter, allowed customers to view what they want, when they want, and ad free with a low monthly subscription service. An innovator in the entertainment industry that became less add-free, expensive, and the same as every other streamer: own-nothing, pay forever.

A vehicle lease has always exemplified the own-nothing, pay-forever vehicle usage model; however, with technology moving so fast in the automotive industry, it may be the best choice for vehicle ownership. Vehicle technology and complexity now depreciates a vehicle faster than ever. Holding onto a vehicle is not the most economical choice for long-term vehicle ownership. The factored in cost of depreciation, the advancement in vehicle propulsion technology, and the obsolescence of the technology for repair costs push the economics of leasing a vehicle cheaper than outright long-term vehicle ownership. Hence, when it comes to vehicle ownership, own-nothing, pay forever may be the better value choice.

It wasn’t so long ago that society struggled with rising credit card debt, which impoverished people. The one thing that can be said about credit card debt is that with diligence, it can be done away with. Subscription services never go away; they are here to impoverish everyone forever; welcome to your subscription service life.

Mark Menean, http://www.saultblog.com