AI-generated summary
There was a time when owning physical collections of music tapes, records, and movies was common, but today, this practice has largely been replaced by digital streaming platforms like Netflix and Spotify. These subscription-based services offer convenience and instant access without the need for physical media or complicated setups. This model has expanded beyond entertainment, influencing various sectors such as mobile phones, computers, transportation, and more, where renting or subscription services are becoming increasingly popular. Studies show a growing willingness, especially among younger generations, to embrace subscription options over ownership, as seen in mobility services that combine public and shared transport through user-friendly apps.
The subscription economy, which began with software-as-a-service (SaaS) models in the tech industry, now underpins many businesses by providing steady revenue streams and attracting investors through continuous value creation. Companies like Salesforce, Amazon Web Services, and Microsoft Azure exemplify this shift from selling products to offering comprehensive service packages. As consumer behavior evolves, brands are encouraged to innovate by offering integrated service bundles and collaborative solutions—such as telecommunications firms providing “home entertainment as a service” or coworking spaces offering complementary amenities. Central to this transformation is the use of data, enabling personalized recommendations and seamless discovery of new content or services. Ultimately, the “life as a service” model is poised to dominate future consumption patterns, benefiting both providers and users in an era of rapid innovation.
Traditionally, consumption patterns have followed a pattern based on buy, use and throw away. Today, however, new formulas are appearing in which experience becomes more important than ownership
There was a time when we all had a huge amount of things that we hardly remember today. Who, after a certain age, has never had a box full of records or music tapes? What movie fan didn’t have a good collection of movies on VHS or DVD? Undoubtedly, there are many of us who come from that scenario and, almost suddenly, without realizing it, we have arrived in a world that is very different in that sense.
Nowadays, it’s not only unnecessary to have a collection of movies, but the mere idea of having to pull out a disc, put it in a player, use a remote control, and do the process again, when we want to watch something different. On the other hand, today, the most logical and the most widespread practice is to sit comfortably in the armchair, turn on the TV and use a streaming platform such as Netflix or Spotify.
That subscription-based model is spreading to other industries. For example, more and more people are renting their phones, with the promise of a trade-in or a discount when they are traded in for a new one. As with other devices, such as computers, televisions or in transport, with practices such as renting or the rental of electric motorcycles or scooters in many cities.
An upward trend with many advantages
Recent studies show that the subscription format is increasingly used and that the trend does not seem to be reversing in the near future. When we are provided with affordable and convenient alternatives to owning our products and services, we don’t seem to mind switching to subscription models.
For example, a report by University College London’s MaaSLab (Mobility as a Service Lab) highlighted that young people were less inclined to own a car as more alternatives became available. 55% of respondents and under the age of 30, stated that if there was an app that offered a combined combination of easy access to public transport and shared transport through a single, user-friendly interface with simple payment options, they would be willing to use that app instead of purchasing their own means of transport.
This subscription-based formula is proven in many industries and sectors. And there is no doubt that their benefits for those who implement them are many, as we have already explained in another article. These include providing recurring revenue streams rather than one-off sales or achieving a better outlook on future earnings that can attract more investors and place a greater emphasis on continuous value creation.
Computer science was the starting point
For the consumer electronics industry, very important steps have been taken in this line. In fact, this practice began here. One of its founding milestones was marked by Salesforce in 1999, when it designed an original portfolio of solutions as a service consisting of SaaS (software as a service), PaaS (platform as a service) and IaaS (infrastructure as a service). Since then, it is increasingly easy to find cases in which it has gone from selling hardware and software to offering companies an “office as a service”. Basically, companies can subscribe to all the tools necessary for their operations, including technical support and updates. This is especially attractive for small and medium-sized companies that find it difficult to maintain an in-house IT department. There are many examples, in addition to Salesforce, there are many, some as popular as Amazon Web Services, Microsoft Azure or Google Workspace, among many others.
A field full of opportunities
With the spread of these practices, changes in consumer behaviors have been generated . This, in turn, promotes the market for these services to rise, as if it were a vicious circle.
From this point, brands must be aware of what this change is going to mean in the coming years. This implies starting to think outside the box and deliver value to the customer. Some of the practices suggest that the way forward will be to be more open to collaborations and packages with other brands and services. For example, let’s imagine a telecommunications company that offers you “home entertainment as a service,” where you get high-speed internet, a TV, a speaker system, a tablet, streaming services, channel packages, and all cables, including installation, support, and upgrade when needed.
Another example, quite widespread, although less technological: coworking offices that, in addition to space, offer a whole series of complementary services, from the logical and essential internet service, to talks, networking events and legal advice.
The importance of data
A fundamental role in this new system is played by data. Going back to the initial example, before a film lover had to be attentive to be able to enjoy the novelties. On the other hand, on platforms such as Netflix, HBO, Spotify or so many other similar platforms, the data collected from these aggregator services keeps us in the loop thanks to recommendations based on our previous behavior so that we discover new things with a higher probability of liking them. Thanks to opting for experiences instead of specific products and materials, as we did before, it is relatively easier for us to discover new artists, films, restaurants, books, cafes… There is no doubt that, sooner or later, this model will end up being imposed in many sectors, both for the advantages it offers to those who provide them, as well as to users and consumers. In a world like today’s, where innovations and changes are dizzying, Life as service is going to become the great alternative to traditional consumption patterns
