CLARITY BUZZ

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Subscription Model. Part 1. Learning From Service Industries.

The global economy evolved over time with the introduction of innovations and technologies. Subscription model has been around for some time pioneered by the media industry that has been selling newspaper subscriptions for decades. Billing solutions evolved from the service industries such as utilities and telecom requiring automation of the consumption-based customer billing. Now we see the subscription and consumption-based models coming together which gives businesses the ability to monetize business models that allow customers both to subscribe to the service and pay for it based on actual consumption and to pay for the actual value that the customer gets from the service. Subscription is a specific commitment for a specific period. The whole idea is that the customers may discontinue this commitment once they stop getting value from the service provided. I believe that value-based and outcome-based business models are the future of subscription business.