Opinion: The Subscription Economy Has Gone Too Far

The average American household spent $219 per month on subscription services in 2025, according to West Monroe research. That is $2,628 per year. The same research found that consumers estimate they spend $86 per month  a $133 monthly underestimation. We are subscribing to things we have forgotten we pay for, which is not a coincidence. It is a business model.

The subscription economy has produced genuine value at scale. Netflix gave us on-demand video without per-rental fees. Spotify gave us access to every piece of recorded music for less than the price of one CD monthly. Salesforce built the SaaS model that made enterprise software more accessible. These were genuinely good value exchanges that customers welcomed.

The problem is that ‘subscription model’ has become default business logic for products and services that have no compelling reason to be subscriptions, and the proliferation has reached the point where management of subscriptions has itself become a cognitive burden.

Products That Should Not Be Subscriptions

Car seat heating. Adobe Photoshop. Office productivity software. Basic navigation in a car you purchased for $60,000. Dishwasher remote diagnostics on a machine you already own. These are not streaming services or SaaS platforms providing ongoing cloud infrastructure. They are software features on hardware you purchased outright.

BMW’s 2022 announcement of a $18/month subscription for heated seats — on a car whose physical seats and heating elements you had already paid for — became the most-cited example of subscription model overreach. The company reversed the decision after customer backlash. The fact that it was proposed at all represents a business culture that has internalised ‘subscription first’ without asking whether each application represents genuine value exchange or pure rent extraction.

The Business Model Logic

Subscriptions are genuinely good business models for the right products. Predictable recurring revenue commands higher company valuations than transactional revenue. Lower churn means higher lifetime customer value. Monthly billing relationships create opportunities for upselling and product expansion that one-time purchases do not.

These business advantages do not justify every subscription. They justify it for products where the ongoing relationship genuinely benefits the customer: software that is continuously updated, services that are continuously delivered, content that is continuously produced. They do not justify it for a one-time feature on a physical product the customer already owns.

The distinction the market is drawing: when a subscription makes the customer question whether they are getting fair value, the business model has misread the value exchange. Subscription fatigue is not irrational consumer resistance to paying for value. It is rational resistance to paying for access to things customers reasonably believe they already own.

The Cognitive Overhead Problem

Managing subscriptions has become a category of adult administrative burden that did not exist 15 years ago. Tracking what you subscribe to, whether you are actively using each service, remembering to cancel trials before billing begins, and evaluating whether each subscription still justifies its monthly cost is time-consuming in aggregate.

The subscription tracking industry — apps like Rocket Money, Bobby, and Truebill (acquired by Rocket Companies for $1.275 billion) — exists entirely because managing subscriptions has become a consumer problem requiring dedicated software. When the solution to a problem requires its own subscription ($4 to $12/month for subscription management apps), something has gone wrong.

Signs the Model Is Moderating

Several major streaming services have reversed unlimited plan models after subscriber loss: Netflix, Disney+, and others have implemented ad-supported tiers and cracked down on account sharing, acknowledging that the low-friction subscription growth of the 2015 to 2022 period is not perpetually sustainable. Annual cancellation rates for streaming subscriptions reached 51 percent in 2024 according to Deloitte — over half of subscribers cancel at least one service per year.

Consumers are getting more deliberate. The ‘subscribe and forget’ customer who never cancels is becoming rarer. Subscription businesses that depend on inertia rather than ongoing value delivery are seeing elevated churn as customers become more active subscription managers.

What a Healthy Subscription Economy Looks Like

I am not arguing against subscriptions. I use approximately 12 of them and consider most worth paying for. I am arguing for a principle: subscriptions are justified when the ongoing relationship genuinely benefits the customer through continuous value delivery. Subscriptions that exist primarily because recurring revenue is better for the company than transactional revenue are rent extraction, and customers are correctly learning to identify and cancel them.

The business model correction that healthy markets produce: higher churn for subscriptions that do not deliver ongoing value, and lower churn for those that do. The data on streaming subscription cancellation rates suggests this correction is already underway. BMW’s retreat on the heated seats subscription is a useful data point. Customers will accept subscriptions for genuine services. They will not permanently accept subscriptions for ownership access.

The Counterargument Worth Considering

The strongest counterargument is that subscriptions often reduce prices for the majority of consumers. Adobe’s Creative Cloud at $55/month is accessible to creators who could not afford $2,000 upfront for perpetual licences. Spotify at $11/month is better value for most music listeners than purchasing individual albums. The subscription model can democratise access to expensive software and content that was previously only available to those with large upfront budgets.

This is correct and worth acknowledging. The subscription model has demonstrably expanded access to professional tools and content. My complaint is with the category of subscriptions that do not expand access to anything new — they simply re-price access to things customers already had or already own. That distinction is worth maintaining.

How much do people spend on subscriptions in 2026?

The average American household spends approximately $219 per month on subscription services, according to West Monroe research, totalling $2,628 per year. Consumers consistently underestimate their subscription spending, averaging $86/month in self-reporting versus the $219 actual figure.

What is subscription fatigue?

Subscription fatigue is the consumer response to managing an overwhelming number of recurring subscriptions, many of which may not justify their ongoing cost. It manifests as higher cancellation rates, more active subscription management, and resistance to new subscription models. Deloitte found 51 percent of US streaming subscribers cancelled at least one service in 2024.

What was the BMW heated seat subscription controversy?

BMW announced a $18/month subscription for heated seats on cars whose heating hardware was already physically installed and paid for. The announcement became the most widely cited example of subscription model overreach. BMW reversed the decision following customer backlash. The incident is notable for representing a subscription that provided no new value — it charged for re-enabling hardware the customer already owned.

Why do companies prefer subscription models?

Subscriptions provide predictable recurring revenue that commands higher company valuations than transactional revenue. They create lower-friction customer retention, produce ongoing customer relationship data, and create upselling opportunities that one-time purchases do not. These business advantages are legitimate for products delivering ongoing value and problematic when used to charge for access to existing value.

Are subscription services worth it?

Individually evaluated, most streaming, software, and SaaS subscriptions deliver value proportional to their cost when actively used. The problem is aggregate: the average household’s $219 monthly subscription spend contains services that are no longer actively used and provide no ongoing value delivery. Regular audit of active subscriptions versus value received is the practical response.

What is the subscription tracking app industry?

Apps including Rocket Money, Bobby, and Truebill help consumers track and manage their subscriptions. Truebill was acquired by Rocket Companies for $1.275 billion, demonstrating the scale of the market for subscription management. The existence of a billion-dollar industry helping consumers manage their subscriptions is itself an indicator of how far subscription proliferation has gone.

Subscriptions Should Earn Their Monthly Fee

The subscription model is not inherently wrong. It is wrong when it substitutes billing cycle friction for genuine value delivery. The correction is already happening in the data: churn is rising for services that do not continuously justify their cost. Consumers are getting better at auditing what they pay for. The businesses that will thrive in the next phase of the subscription economy are those that genuinely earn their monthly fee rather than relying on their customers forgetting they are paying it.