FIGHTING HIDDEN FATIGUE

Fazmina Imamudeen critiques the hidden weight of the subscription economy

The subscription economy refers to a business model where consumers pay a recurring fee (monthly, quarterly or annually) to access a product or service. Rather than making a one-time purchase, users enter into a continuous financial relationship with providers in exchange for convenience, flexibility and access.

Initially popularised by media and service providers such as Netflix, Spotify and Adobe Creative Cloud, the model was swiftly embraced as a symbol of modern commerce.

The early reception was overwhelmingly positive. Subscriptions were considered consumer friendly alternatives to ownership. They reduced upfront costs, offered customisation through tiered pricing and ensured regular updates or content without the need for repurchasing.

Businesses benefited from predictable revenue streams and long-term customer relationships.

In theory, both sides won; but in practice, the landscape has become extremely complex and very concerning.

Over the past decade, the subscription model has extended far beyond its original industries. Today, consumers can subscribe to everything from meal kits and vitamins, to language apps and cloud storage. In emerging markets such as Sri Lanka, a growing digital middle class is encountering this model across educational services, entertainment platforms and financial tools.

But as the model has expanded, so have its shortcomings. The line between convenience and coercion is now increasingly blurred. Automatic renewals, obscure cancellation processes and ‘free’ trials that are quietly converted into paid commitments have become the norm.

According to a 2023 C+R Research study, consumers routinely underestimate their monthly subscription expenditure by believing they spend around US$ 86 when the actual charge averages 219 dollars. This points to deliberate opacity in how services are billed and managed rather than carelessness.

Subscription fatigue refers to the growing dissatisfaction with the number of subscriptions that consumers are expected to manage. While a few essential services may justify their monthly costs, many others survive on the margins of consumer attention.

A study by Stanford University shows that companies can earn between 14 percent and 200 percent more simply by relying on customers forgetting to cancel.

More fundamentally, the shift from ownership to access has introduced a new kind of dependency. Under traditional purchase models, a consumer owned a product outright.

In the subscription economy however, consumers are perpetual tenants of the services they use. Should payments lapse, so too will access to that service. This applies to everything from streaming services to design software and educational platforms.

The growing reliance on intangible access rather than tangible ownership represents a deeper cultural shift. And the result is a generation of consumers who rent not only entertainment but also productivity tools, financial services and even their professional development infrastructure.

In countries such as Sri Lanka where subscription models are gaining popularity across digital services, consumers face tension between access and affordability. Without strong consumer protection regulations, many are vulnerable to aggressive retention tactics, automatic deductions and hidden fees.

The US Federal Trade Commission (FTC) has proposed new rules, which require that cancellation must be as simple as signing up. And the EU is pursuing similar initiatives. For markets without comparable safeguards however, the burden remains largely on consumers to audit their spending and navigate cancellation mechanisms.

However, the subscription economy isn’t inherently flawed – at its best, it enables access and drives innovation while supporting sustainable revenue for businesses.

That said, its unchecked expansion, driven by opacity and psychological entrapment, risks undermining the very advantages that once made it appealing. Going forward, the model must be recalibrated to prioritise transparency, flexibility and ethical engagement over passive extraction.

If businesses fail to act fast, the next wave of disruption will come from consumer rejection rather than innovation.