SaaS subscriptions are magical when they work; they provide much needed regularity to cash flow forecasting which assuages investor timidity.
However, creating a subscription model doesn’t necessarily mean there is a service that warrants it.
However, creating a subscription model doesn’t necessarily mean there is a service that warrants it.
A great example of this is a little addition I've been using to Mail.app, called MailTags[1]. I've been using it for years, religiously upgrading as I go, because email is my primary communications mode and I had a great workflow built around it.
Now it has gone subscription and is storing metadata related to mail on Someone Else's Computer. That's a hard-no for me, and really too bad, but it did make me figure out that I can replicate the workflow I built around that with Mutt and a few shell scripts.
I don't know how common that is, but their attempt to extract regular revenue meant they lost revenue from me. I do sincerely hope it works out for them - I love indie devs! - but more and more, I find subscriptions lead me to substitute open source for whatever it is.
- I use it regularly. (Which means I'll probably be upgrading to new versions anyway.)
- The price is reasonable for the value
- I can export my data in a form that's still useful/accessible once I cancel my subscription.
The problem is that all those conditions are frequently not met.
A couple of alternatives:
1. Decouple the cloud syncing component and sell that as subscription, with a sync-less version for a fee. PWAs mean you don't even need to give up the web platform to do this nowadays.
2. (My personal favourite) is sell a perpetual license but charge for feature upgrades. Retro, I know.
3. Sell a subscription licence which includes a perpetual license for the latest copy of the software. If you stop paying, you stop getting updates. JetBeains works like this with their products.
I think having a cloud component is often used as an excuse to explain the subscription model.
With SaaS, you can simply cancel your subscription. With a single-purchase license though, it's basically money you have flushed down the drain (unless the company is really generous with their refund policy).
I think single-purchase licenses work for some things, but they're a hard sell for others. For example, I really, really can't justify paying for a password manager for example.
At the same time, monthly subscriptions make sense for some things but don't make sense for others.
I wonder if drilling into the whys of these choices would be useful. Like maybe password management is so crucial and with specific requirements that it makes no sense to pay someone else to take control of it.
I'm personally very willing to pay for smarter people than me to handle problems I have but maybe it's not always the case that they're smarter than me or maybe there is a really ergonomic solution I can retrofit to my needs.
As a customer who values his time I have to manage one more recurring payment, I have to interact with (up)sales-people disguised as customer service and I have to keep records of canceling the service n years (depending on jurisdiction) because I don't know yet who will buy the leftovers of a company once it's not profitable so they can massmail "due payment notices" to all former customers, making a profit from those who fail to object in time.
Is this a common practice? It sounds very unethical, but the cynic in me can imagine it happening.