Friday, January 6, 2012

The new revenue stream

Originally published on Technorati as "The New Revenue Stream."

Remember way back before the Iphone or the I anything for that matter?  Those were the days when we went out and bought a piece of technology and whatever else we needed for it and Boom! we were pretty much done.  When we wore it out we went and bought a new one.

Getting a cell phone was a pretty simple proposition.  You picked the device and how many minutes you thought you'd need and paid your bill every month.  Now you'd be hard pressed to find a phone without features you'll never use but are charged for anyway.  Not to mention overage charges for data or unlimited plans that really aren't unlimited either cutting you off or degrading your service over a preset limit.

Everything's a subscription now.  Seems like you never stop paying.  Services like Netflix started it.  Used to be you'd pay a small subscription fee and get your choice of DVD's every month.  What made them successful was the elimination of late fees and the highway robbery of the chain video rental stores.  Now it's streaming movies at 8 bucks a month to any device that can use the service.  Even if you don't use it.

Yes, it's wonderful that you can go to Itunes and just buy the song you like for 99 cents and leave the rest of the selections on the curb .  Of course you've bought a lesser quality version of the song for roughly the same price as the same song on CD but hey, it's in your Itunes now, so long as you don't lose your password...

You can even subscribe to Microsoft Office 365 to essentially "rent" the use of office applications.  Too bad if you miss that monthly payment and want to open your Word document.

I can go to and back up my computer to the cloud automatically, for a fee of course.  That fee goes up if I have more than one computer and/or external device to back up by the way.

Gee, used to be I got a backup program with my operating system or I could get a better one and that was it.  I didn't have to subscribe to anything.

Buy an IPAD or an Iphone and you're not likely to have much fun with it unless you visit the app store which generally involves a purchase or subscription depending on what you choose from it.  Oh, and don't forget that 2 year contract and/or ridiculous initial cost of the device.

Let's not forget that our workplaces will have limits on our bandwidth and most ISP's impose bandwidth limits on how much data you can use per month.

Too bad if you were backing up you Terabyte Hard drive to Carbonite...

The point is that more and more products seem to be introduced whose very design is to work with this subscription model.  Product features tend to be stripped down for the sake of it.  Even the latest version of Windows dumped their email client in favor of the useless free Windows Live suite or online applications such as Hotmail or Gmail.

 I wonder when they'll dump notepad...

Yes it's true that application suites were prohibitively expensive but if you didn't need to be on the cutting edge you could always find a deal on the previous version.  You didn't have to keep paying for it either.   It seems we've been led to believe that the a la' carte model lowers the barriers of entry to productivity and recreational apps but the truth is that we're just spreading out our buying patterns. 

With every app you buy you end up on another mailing list.  There's also this false ubiquity that anything in the cloud is secure and accessible.  Yes, it may be so long as you pay the subscription.  Let's also hope they don't go out of business taking your data with them.  Read the Terms of Service,  if they're gone, so's your data...

There's nothing wrong with making applications more accessible but to rely on the subscription model and the cloud exclusively  is dangerous.  I'd hate, for example, to lose the ability to update my resume if I had to cancel my office 365 subscription after losing my job. 

I sometimes chafe when I hear some pundit advocating how the cloud should be our primary data repository.  Really?  You have that much faith in a web page with an e-commerce portal to secure your data? 

I can't accept that a commercial entity has my best interests at heart thus I have no faith in the assumption that they do.  Yet when I look around I see a consumer mindset that accepts the premise as reasonable. 

Whatever happened to Caveat Emptor?  I guess they don't teach that in schools anymore...

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