Are Subscription Services Scamming Us for Our Money?


Have you ever thought if it’s actually worth your money for Netflix, Hulu, Spotify, and other subscription based services? In Todd Spangler’s article, U.S. Consumers Now Pay $47 Monthly for Streaming Services — up 24% Since COVID Hit, Survey Finds, consumers began to increase their budget on streaming services since staying at home. The issue is not that we pay for these services, but the fact that even more companies are moving into the subscription based business that there are too many options for the consumers. In the end, we tend to over purchase and don’t use some of the services. Obsolescence, variety of entertainment, and the overflow of new subscriptions are why services scam us for our money.

Recently, Netflix has raised the rates of their pricing for both standard and premium plans. Both being greatly increased, many people are dropping this service for cheaper ones such as Disney Plus and Hulu. Adding on other services such as Apple One and Spotify then increases this amount for entertainment subscriptions and negates the purpose to drop the higher paying service. Cameron Huddleston states in his article, Thousands of Americans Waste $348 a Year on Subscriptions They’re Not Using that “You’re not saving money if you’re paying for a service that’s going unused. GOBankingRates’ survey found that many Americans aren’t using their entertainment subscriptions every day. About 9% of respondents said they use the services on a monthly basis. And, more than 4% said they never use the entertainment subscriptions that they’re paying for.” What is the purpose of purchasing these subscriptions if you’re not even going to use it? If you were to pay for something on a monthly basis wouldn’t you try and use it as much as you can to make it at least worth it? Eventually, it comes down to the variety of services the subscription can provide for you to make the service more worthwhile.

Action, Anime, K-Drama, are some of the many categories in today's streaming services, but are all the shows you want to watch on one? Sometimes shows or music that we want are not available on the subscriptions we pay for and end up going online to find them. In the article, Nearly Half of U.S. Consumers Are Frustrated With a Bloated Streaming Market, Tyler Hersko stated “The Deloitte survey noted that 47 percent of consumers are frustrated that they need multiple subscriptions to watch the shows they want. Shows disappearing from streaming platforms also was an issue for 57 percent of respondents.” Nowadays you can find downloads/recordings of the content you can’t find on a specific service on YouTube or 3rd party websites. Many of these “free” websites spam you with ads, but enabling an ad blocker allows the user to access the website and watch the shows without having to pay for the premium on a monthly basis. With music, there are websites that allow you to download the file (high definition options as well) and you can add to your devices after connecting it to the computer. If there are other free options out there why are people still purchasing into these expensive services? 

There are now over 300 subscription services along for streaming in the US. Moreover, consumers are having a hard time choosing due to this increase in the different services provided. In this case, the more is never the merrier. It becomes very difficult to track down what you are paying for, thus bundled services are highly looked upon. Apple One has been released recently and has caught the attention of many service providers because with their new plan it can get rid of many services and bring it all in one bundle: music, streaming, storage, news, gaming, and fitness. Before that we would have to purchase individual plans, but now we can simplify what we need for a cheaper price. The only issue with this, if you are not in the Apple ecosystem most of these services deem useless unless you download their apps for it. Like stated before, you are wasting money if you don’t use the service so in the end we are still wasting the money for the bundles because we don’t use all the services to make it worth spending. 

Of course there are many positives when purchasing these subscriptions. You don’t have to worry about having low quality streaming, whether it’s music, tv, or podcasts. With the premium services you are able to save and download your favorites to your devices (as long as the service is still active) with easy access. In Sean Keith’s article, How Subscription Services Are Helping Revive Restaurants, he states “Subscription services' most obvious benefit is their ability to supplement transactional purchases with recurring revenue. But with 70 percent of subscription revenue on average coming from existing customers, subscription services also increase average customer lifetime value.” He further explains with the example of Panera plus, in which benefit increases greatly with purchases like bagels or breakfast sandwiches. This led to a 70% increase in their food products being a choice whenever ordering due to the idea that they earn more by getting these goods, which then increases sales for Panera. Paid subscription services also have the security that many websites do not. With those 3rd party websites, if you aren’t protected a virus can ruin your device and then there goes a lot of money down the drain. Was it worth it to try and exploit the system? Isn’t it better to be safer than sorry?

The problem with subscription services these days are that there are too many paid services and the fact that most of the time we don’t use the services to make it worth it. Obsolescence, variety of entertainment, and the overflow of new subscriptions are why services scam us for our money. With 3rd party websites and ad blockers we are able to watch media we cannot find in some streaming services and download music in high quality. Bundles of services are most practical and are sometimes a cheaper purchase, but if not all services are used it’s still considered a waste. Of course these services also provide security and the best quality, but at a premium price on a monthly basis. The use is only at maximum now because we are stuck at home, but what happens when we go back? Do you think it’s worth it to pay the premium for obsolete services?

Works Cited:

Hersko, Tyler. “Nearly Half of U.S. Consumers Are Frustrated With a Bloated Streaming Market.” IndieWire, 13 June 2019, www.indiewire.com/2019/06/too-many-streaming-services-television-decentralization-1202149596.

Huddleston, Cameron. “Thousands of Americans Waste $348 a Year on Subscriptions They’re Not Using.” Yahoo Finance, 15 July 2019, finance.yahoo.com/news/thousands-americans-waste-364-subscriptions-090000514.html.

Keith, Sean. “How Subscription Services Are Helping Revive Restaurants.” QSR Magazine, 29 Dec. 2020, www.qsrmagazine.com/outside-insights/how-subscription-services-are-helping-revive-restaurants.

Spangler, Todd. “U.S. Consumers Now Pay $47 Monthly for Streaming Services — up 24% Since COVID Hit, Survey Finds.” Variety, 22 Jan. 2021, variety.com/2021/digital/news/us-consumers-pay-average-47-dollars-monthly-svod-streaming-1234890534.

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