The Insidious Rise of the Subscription Economy
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Last week Press Gazette, a UK B2B media publication, published a graph illustrating the cost of annual subscriptions to news organisations and its findings, though drawn purely from publicly available data, kind of shocked me. A digital subscription to the FT will cost you £319 a year (the highest on the list), followed by The Times at £312 and then a jump down to Bloomberg (£199) and The Telegraph (£189). The cheapest digital subscriptions offered by UK newspapers? The i (£54.99) and the Belfast Telegraph (£49.99).
I’ve known that the FT is expensive, ever since I accidentally signed up in 2015 and forgot to cancel for several months and then had to make begging phonecalls to its customer service department. But £319?! And remember, that’s just digital. The Times is basically equally expensive, a fact that has eluded me because I still use the corporate Times login of a company I left several years ago (and, indeed, The Times is infamous for its failure to deal with password sharing — which might be why they’ve ramped those prices up).
I’ll just run you through some of the magazine findings too, for completeness’s sake: most expensive is, naturally, The Economist at £189. The Spectator and New Statesman represent their demographics at £99 and £49 respectively. American publications, interestingly, are not noticeably more expensive, even for international subscribers: the New Yorker a steal at £97.17, The Athletic a bargain at £95.88 and The Atlantic practically giving itself away at £48.55.
The question for me, with these figures, is whether it’s possible for people to sustain an effective news habit in this era. If you price your product at £300+ then you are, essentially, asking your readership to limit themselves to your publication. Multiple subscriptions at that price point is hard to imagine — it is already the cost of a mobile phone contract.
But this is basically an industry wide phenomenon. Subscribers are being priced out of the option of maximising their coverage. And nowhere is this starker than in UK sports broadcasting. If you are a fan of Premier League football and want to ensure that you will be able to watch every broadcast of your preferred team (a reasonable request) then you need to buy: a £34-a-month subscription to Sky Sports; a £30-a-month subscription to BT Sport; and a £9-a-month subscription to Amazon Prime. That’s on top of, say, a season ticket (usually priced in the UK between £500–1000 per annum). And even then, there will be a handful of games that are not broadcast on any UK provider, and are not viewable to fans unless they, say, schlep up the M1 on a rainy Saturday afternoon.
I find this discussion particularly interesting in the context of a pan-European crackdown on illegal streaming. Illegal streaming has been ubiquitous for many years (I can well remember watching West Ham on grainy, frequently buffering, displays in my university library) but has certainly improved in the last few years. The premise is simple: dodgy, disposable websites broadcast live streams that mirror the footage being put out on “real” channels. This includes both services like Sky and BT, for those who don’t want to, or can’t, pay the eye-watering fees, and also broadcasts of international feeds, which include games that have not been sold to UK providers. Thisincludes the famous Saturday 3pm kick-offs, which are protected from broadcast in the UK in order to ring-fence clubs’ ticket sales.
Last week The Athletic produced a long read about the attempts to crackdown on illegal streaming. The piece focused on a report which said that legitimate broadcasters were losing almost £3bn of revenue per year to the pirates of illegal broadcasting. The piece also ran a statement from the Premier League reading: “Protecting the Premier League’s copyright and the investment made by our broadcast partners, is hugely important to us and the future health of English football. The ability that clubs have to develop and acquire talented players, to build and improve stadiums, and to support communities and schools is all predicated on being able to market, sell and protect commercial rights.”
Obviously, I might feel differently if I were the CEO of Sky Sports. But I’m not. And the Premier League and Sky and BT and all the football clubs, in my opinion, make enough money. And if they want to make more money, they can stop the gratuitous waste of money. But enough of the polemic: a £3bn hole is enough for the Premier League to start pressuring the authorities to put the squeeze on illegal streamers. That focuses mainly on the masterminds of the streaming services (which we’re told are often used to fund more serious crimes, which seems to be the scaremongering refrain always attached to these apparently victimless internet bandits). But it also includes more worrying reports that the police would visit 1,000 homes in a week (commencing 9th January) in a crackdown on illegal streaming. Imagine trying to prosecute someone, in current economic conditions, for the crime of watching West Ham lose 2–0 to Brentford?
But this is all just a consequence of the increasing atomisation of media services; the move away from that coherent cable package. I haven’t even started talking about streaming video entertainment packages (not least because they seem quite modestly priced compared with the insanity of Premier League football or financial journalism). Netflix premium? £15.99 a month. Disney+? £7.99 a month. Apple TV? £6.99 a month.
The insidious rise of a subscription based purchasing economy (I am writing this newsletter, for example, in Microsoft Word, software I would previously have bought a one-off perpetual license for, but which I am now forced to pay £5.99 a month to use) has relied on financial negligence. It has taken as a starting principle the assumption that people rack up subscriptions without realising the true, accumulated cost. And there was sense in that: it is very easy just to add a sub-£10-per-month subscription to your life without worrying about its overall financial impact. But that was in a pre-crisis economy. It is hard right now to see any way in which this atomisation benefits consumers, and whether reprisals happen via feet-talking (which we’ve seen, to some extent, at Netflix) or legislation, I suspect that the current trend towards a suite of extreme costs is unsustainable.
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