18 ms·

It looks like a product but is secretly a subscription

463 points by calpaterson 5y ago

k__ 5y ago
I was never good at accounting stuff. Do I generally want to move as much as possible to OPEX, so I don't have to pay any taxes in the end?
nimbius 5y ago
>it looks like a product but secretly a subscription Surely this isnt about playdate.
- Elidrake24 5y ago
  Can’t see how it would be; you pay up front to own (lifetime access without need to check a DRM server) X amount of games which are released to you over time. If you want another Y amount of games, you can pay again, or you can just keep what you’ve already bought. Closer to their point would be the battery or the mechanism behind the crank that will inevitably fail.
- hug 5y ago
  This is a bit of a weird derail, presumably because you don't like the idea of the Playdate, but it's worth pointing out that the subscription, in the case of Playdate, works much like milk: It's better as a subscription. But Playdate is both parts. It's a device built to host a subscription, but the subscription itself only works to support the device. The device is built with deliberate constraints to provoke creativity in game design, and that creativity in game design is what you subscribe to. It's the milk bottle and the milk. The thing is that no one is buying a Playdate without being aware of what they're getting. There's no hidden catches or unadvertised subscription fees. You can, if you want, just buy a Playdate and sideload content onto it, although you won't get the next season's games and the thing that makes the device special in a lot of people's minds. Without it, you will never get to play Lucas Pope's next game. Without it, Lucas Pope would never make a handheld game operated by a crank. Does this mean anything to you? Maybe not. If it doesn't, don't buy it and don't subscribe. You probably also don't subscribe to my favourite magazine, Scrimshander's Monthly. People have different interests, and find lots of different things cool, and that's okay.
  - Danieru 5y ago
    > The thing is that no one is buying a Playdate without being aware of what they're getting. Nonsense, no one knows anything about future subscriptions aka "what they are getting". How can consumers be fully informed when nothing is announced? The PlayDate will have an astronomically small install base. Amortizing a dozen game's developments over such a small install base without subsidy from Panic will surely lead to sticker shock. There are 21 titles in the first season. At a mere 50K USD per title (small even for indie dev budgets) that is 1,050K USD to develop the season. With 20K sold play dates that's a per device cost of 50$, or about 100$ for a year of releases. Can the playdate justify a 8$ per month subscription? Yeah I think so, but only because it is a pure novelty. Except novelties have a habit of being low commitement. If only 25% of units re-sub that puts your per sub development costs at 400$ a year. Are Playdate owners going to be happy to pay 2x the cost of the device for a single year of games? Obviously not. The playdate needs to move more units or it will die, I don't think current buyers understand this risk at _all_.
    - hug 5y ago
      No one knows anything about the financials of the thing but you do know what you're getting: A unique little handheld, with 21 unique-to-the-platform indie games, at known price point, and a promise that they're gonna try to put out seasons of games. What you might get thereafter being entirely unknown (other than it being a device-bespoke set of games for some price) is exciting. Maybe the subscription will be too pricey to stomach. Maybe they'll go tits up. Maybe it'll be a complete commercial flop. Maybe, on the other hand, they've already sold 100,000 devices and manage an attach rate of 65% at $5 a month and they make that million a quarter to fund games. Maybe it's $20 a 3 month season and they've got even more in their pocket. Who knows, but I'm still excited.
      - Danieru 5y ago
        Yeah okay you've convinced me, the play date is pretty cool. Its working against the odds but I love the quirky and open platform aspects.
Waterluvian 5y ago
A lot of good thoughts in here. The one I personally want everyone to take away is that most plastics are not recycled. Unless it’s glass, fibre, or aluminum, you are lying to yourself if it’s going into the blue bin. Glass-contained milk delivery seems great. Someone needs to start a company. Sure it won’t be sexy or use AI but it’s useful. I have a local co-op that delivers local produce. It’s amazing to see a pile of naked produce show up in a repurposed apple crate.
- reilly3000 5y ago
  Staples-as-a-Service. I would totally buy that service vs overpriced meal boxes or on-demand grocery delivery. An app could be used to coordinate your order/inventory levels, and a reusable cooler could sit on your porch or lobby for exchange and temp storage. Pop a cheap tracker and lock in it if piracy is an issue. There are major efficiencies associated with route delivery vs on-demand ordering- pick&pack in batches, delivery in batches, consistent staffing needs, etc. somebody should pitch this for Winter 2022!
  - BLKNSLVR 5y ago
    Nit: Theft may be a more accurate term than piracy. Arrrr, through my spyglass I did sight a hearty meal on thy dock, and being as I am a ravenous, immoral beast I bent my sails against the wind to secure it as my prize. But thwarted I were by a hidden RFID and three days hence arrested by a regiment of dirty british redcoats. But, upon mine hanging, my belly were full and thine empty.
    - reilly3000 5y ago
      Yar. Porch pirates are a scourge of the seven streets to be sure... RFID is no match, but GPS + Cell could finally bring justice to these shores. https://www.aliexpress.com/item/4000235765025.html https://www.aliexpress.com/item/4000235765025.html That plus a little lock system might just do it, but at some point its cheaper just to redeliver stuff than worry about reusable containers being stolen, especially when you have to figure out how to power the damn thing and get a ton of cheap SIMs+plans.
eric4smith 5y ago
Hehe - disposable razors (with the removable head) are also a kind of subscription. Good piece. So many things are hidden subscriptions these days, even when they don’t have a need to be. It’s so obviously a money grab.
- BLKNSLVR 5y ago
  Worth reading the whole article, I'm only referencing a couple of specifics. The very last sentence of the article is what it was all leading to, and excellently summed up into what is a modern recurring theme: good business practice is consumer-unfriendly practice. I thought this was specifically called the "Gillette Business Model". Reading the relevant wikipedia page[0], which also mentions printers and ink, calls it the "razor and blade" model. One must also familiarise oneself with the "Machine that goes ping" Monty Python skit (on YT, watch it, it's much better than just reading the relevant quote). It was my first introduction to the complexities of corporate finance: "Ah, I see you have the machine that goes 'ping!'. This is my favourite. You see, we lease this back from the company we sold it to - that way it comes under the monthly current budget and not the capital account"[1] [0]: https://en.wikipedia.org/wiki/Razor_and_blades_model https://en.wikipedia.org/wiki/Razor_and_blades_model [1]: https://en.wikiquote.org/wiki/Monty_Python%27s_The_Meaning_of_Life https://en.wikiquote.org/wiki/Monty_Python%27s_The_Meaning_o...
  - toyg 5y ago
    I almost lost a friendship on discussing that "good business is consumer-unfriendly". Because it fundamentally alters one's view of the consumerist-capitalism society we live in, it's very hard to accept for anyone invested in the system, even slightly. if one accepts that fact, then the question becomes: is there a level of user-unfriendliness that is morally acceptable? Or is it all pure and simple exploitation? Which cannot be logically answered in a clear and simple way; we just accept the status quo because we think any potential alternative would be worse, which we have no way of knowing.
- askvictor 5y ago
  Even the older double-edged safety razors were designed around such a model, but at least there is a 'standard' for those, with plenty of different companies producing interoperable consumables. Would it be fair to say that any product with consumables that are proprietary to the vendor, is a subscription?
Zababa 5y ago
Other submission here https://news.ycombinator.com/item?id=28037039 https://news.ycombinator.com/item?id=28037039. For some reason, algolia adds 10 hours to the submission time, this one that's 1 hour ago according to HN is marked as 11 hours ago, and the other that's 10 hours ago according to HN is marked as 20 hours ago.
- gruez 5y ago
  It's something to do with the "second chance" mechanism. Here's the email I gotten from dang explaining the issue: >It's an artifact of the re-upping system. '1 day ago' was the original submission time and '1 hour ago' was the re-up time. Lots of explanation here: https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=by%3Adang%20timestamps&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que.... Sorry for the confusion! >See also https://news.ycombinator.com/item?id=11662380 https://news.ycombinator.com/item?id=11662380 and links back from there.
  - Zababa 5y ago
    Thanks!
paxys 5y ago
Great article. One minor point of disagreement I have: > For Adobe's subscribers, the lock-in is considerable as access to their existing bank of files and documents is contingent on continued payment. Losing access to uploaded files isn't really a relevant factor in paying for an Adobe subscription. Their cloud storage is an afterthought, and they can all anyways be trivially exported. The lock-in comes from the software itself. We must have Photoshop, and there is no other way to get Photoshop than to pay Adobe every month till you die.
- infogulch 5y ago
  That's not really a disagreement, I think that's what the author meant.
- legohead 5y ago
  also, once you realize you hardly use photoshop and cancel your subscription, you get a fat cancellation fee. so do you pay the cancel fee, or "maybe I'll need photoshop, who knows?"
- ludocode 5y ago
  I don't think he meant losing access to cloud storage. He meant losing the ability to open your files. It makes little difference whether you're storing the files yourself because you can't open them without Photoshop.
dsr_ 5y ago
Printers. Yeah. Herewith, my standard advice. Buy a Brother monochrome laser with duplex, an ethernet port, and BRScript/3 (their PostScript clone). Even if you're sure you will never need one or more of those features, get them all. Wifi and Bluetooth and NFC are strictly optional, and probably not worthwhile. If you need color printing, send it to a printing company. There might even be a local one. It will be done at a higher quality, with better ink and good paper, than you can do at your office or house -- unless you are big enough to utilize a whole flock of printers, or you are a professional. If you are a pro, you don't need this advice.
- temporallobe 5y ago
  My wife started her PhD program a few years ago and printed nearly all of her resources on our inkjet printer at the time - only to recycle all of it after the class was completed. We were spending ridiculous amounts of money and constantly going out to buy the darn cartridges. I don’t know why, but I had completely forgotten about laser printers, then one day I suddenly remembered from my childhood school days that everyone used laser printers, did some research, and bought one. The cost was more than triple that of a decent inkjet, but nearly three years later, and she has only had to buy maybe two toner cartridges and the darn thing is extremely reliable. Personally I wish she didn’t have to print so much, but it helps her quickly annotate, locate, and visualize large amounts of literature.
- NortySpock 5y ago
  Great advice, and I echo 95% of it. My observation is that I have found Wifi useful when I need the printer in an odd location in the house, and color is useful for non-professional usage like "the kids need to print out their report for school" and "the med school student needs anatomy diagrams in color" My trusty color Brother laser HL-3170CDW cost ~$300 at the time and has been trucking along for 7+ years now without a hiccup. If it dies, I'm replacing it with another Brother laser printer. EDIT: added cost of printer. The article is right: if all you are ever going to do is print your taxes and financial documents once a year, a ~$100 monochrome laser printer is fine.
  - 5y ago
PretzelPirate 5y ago
> …so if you are into your environmentalism then milk is the SaaS for you. Dairy isn’t know for being great for the environment.
- yinyang_in 5y ago
  Imo dairy isn't good if done via industry model i.e. central company provides value for all. All cow in central place, profit oriented. Old cows thrown for slaughter, it becomes very inhumane. Coming from village where cow is part of family and treatment like family and has name as we do, then same dairy become very beautiful relationship.
  - selectnull 5y ago
    When that named cow gets old and dies, does it get buried in the family cemetery along with the rest of the family? Do you mourn for it? Or perhaps, it turns into a steak of some form or another?
  - wutwutwutwut 5y ago
    Why would having the cow part of the family be any better from an environmental point of view?
  - rasguanabana 5y ago
    You do realize that in order to get milk from a cow there is a precondition that ultimately leads to slaughter anyway? Unless you can afford keeping every calf and won’t exploit them for milk further.
- bbojan 5y ago
  Cattle is key for regenerative agriculture. See also Allan Savory's Holistic management.
  - PretzelPirate 5y ago
    Cows can exist without a dairy industry. The works used to use many wild ruminants whose existence naturally helped maintain the ecosystem.
cletus 5y ago
Printers are just another example of how effective loss leaders are in selling products (or subscriptions if you want to call them that). Classic example: fast food burgers are typically sold at or near cost. It's the fries and drinks where they make all their money. It's also why accessory sales are so prevalent. I've heard of $800 cameras being sold for <$10 profit but a $1 UV filter is sold for $20.. And then there's the whole extended warranty "scam". By the way, staff in Best Buy and the like are typically judged on how many warranties they sell, not how many products. That's why such places push them so hard. Anyway, one thing I want to say about printers is that in the "home" end of the market there are really two types of printers: 1. Cheap printers intended to get customers into a cycle of buying expensive ink. These printers are typically sold near or even below cost. They may even cost less than a full set of replacement ink but you should know the printer rarely comes with full cartridges. Honestly, I would completely avoid this kind of printer. It's worth noting that these printers are designed to go through ink as fast as possible. This includes using the ink to clean the print heads every day so you'll run out of ink after some months even if you've never printed a page; and 2. So-called tank printers. These have a higher duty cycle and are more expensive. Instead of cartridges you typically fill them with bottles of ink (and much more of it than you'd typically find in a cartridge). These don't have the same ink-selling focus the first category has. If you print at all just buy a tank printer. As for add-on services like Adobe's cloud... I mean does anyone really trust Adobe with this? For the record, I'm a big fan of the _idea_ of software subscriptions. I know some people like to own their software outright but software requires constant maintenance. Security fixes, bug fixes, supporting new devices, that sort of thing. A sticker price and that's it creates perverse incentives for the company to end-of-life your software so you have to buy an upgrade. It's better to just pay a hopefully reasonable ongoing fee. The gold standard for software subscriptions is Jetbrains. You get 3 major releases a year, annual or monthly subscriptions and when you stop paying you get to keep old versions forever. Compare that to Adobe's Photoshop and Lightroom... yeesh. Adobe's idea of reasonable pricing is monthly cost = sticker price / 12. Oh and you have to sign up for a year, get auto-renewed and it's difficult to cancel.
- BLKNSLVR 5y ago
  Got the extended warranty on a Samsung TV once. It was a relatively small percentage to add to the purchase price, so said 'yes' when I would normally say 'no'. That warranty ended up being very worthwhile as the panel developed the vertical lines problem, after 18 - 24 months - got a full replacement TV as the purchased model was no longer 'current' or able to be serviced. The replacement eventually got the vertical lines as well, still inside the 5-year (I think) warranty period - got another replacement, which is still going strong. The original TV, with extended warranty, was purchased probably ten years ago. Another cost to factor in with an extended warranty is the time / hassle to actually make the claim. Claiming the warranty on the second TV failure required some argumentative firmness.
mrfusion 5y ago
It’s sad to think a tesla might fall into this category.
gordon_freeman 5y ago
This would sound strange but the biggest subscription I pay annually (which does not seem like a subscription) is my DMV registration renewal fees. It comes around $300+ every year out-of-the-blue in my mailbox and I realize then that is indeed a subscription for a product which is my Car that I never thought about.
- odux 5y ago
  So taxes are subscription to living in a city/country? Kind of, but you can opt out of subscriptions.
  - em-bee 5y ago
    well you can opt out of the DMV subscription by getting rid of the car and use public transport. and just like ditching your printer, it does not work for everyone
  - TeMPOraL 5y ago
    Essentially, yes. Not for just living, but also for having free access to all the services provided by the government/municipality.
- the_pwner224 5y ago
  From a practical persepctive you are indeed correct. In 99.9% of cases - the DMV are effectively a subscription expense you need to pay to use your car. But they're not actually a subscription to your car; the fees are a subscription to the roads and associated infrastructure, which do need constant upkeep. If you had a vehicle which was only used off-road (for example, on privately owned racetracks) and was only transported on a trailer then you would not need to register or insure it. For track motorcycles it's even relatively common to buy/sell them used without a title - so $0 fees to the government. Obviously exact laws on this may vary depending on location.
- nonameiguess 5y ago
  Property tax has to be more than that. Even if you don't own your residence, whatever the landlord passes through to tenants is going to be more than $300 a year.
taurath 5y ago
> Good business sense is to do only what is reasonable for yourself but great business sense is to make others do what is not. I think its interesting to meditate for a moment on the great amount of meaning in the closing sentence here. Great business sense by this definition seems inherently immoral and extractive rather than productive for one. Secondly the it seems quite the antithesis of competition under free capitalism producing better outcomes - the effects of concentrations and imbalances of power is something that is frequently left out of those debates. I think that we should try to strive for a world where good and moral business sense is better rewarded than great business sense.
- lwansbrough 5y ago
  > I think that we should try to strive for a world where good and moral business sense is better rewarded than great business sense. This stuff gets outcompeted by the free market every time. You don’t have to look far to find failed attempts to plan economies around the morals du jour. The whole point of free market capitalism is it’s game theory - if something worked better anybody would be free to use that better method. Humans have a consensus on what better means, and free markets are structured around that (+ a sane amount of government oversight because humans act dumb at scale.)
  - taurath 5y ago
    The structure of the market is such that massive scale and non-local business has been winning out lately, but that has not always been the case. I’m not arguing against capitalism here (plenty of arguments to be made tho), but against the incentives of our current policies.
  - CRConrad 5y ago
    When market mechanisms lead to a sub-optimal outcome "within" the economy, that's called a "market imperfection" or "market failure". The fact that these things exist show that "the free market", while perhaps the best system ([Citation needed]) is certainly not perfect. On the meta-level, should the fact that "the free market" wins out even though it is perhaps not the best system -- at least according to many (most?) people's morals "du jour", however long that is -- be called a "meta-market imperfection" or a "market meta-failure"?
SavantIdiot 5y ago
He mentions "Smart TVs". I always thought you could just buy a SmartTV and not connect the internet and have a dumb TV. Nope. HDMI changed that. I bought a TV a few months ago and it started showing adverts because it was connected to the internet through my ROKU via HDMI. That's right, you can't even have a dumb TV anymore. Someone needs to make an HDMI internet filter, stat. But Adobe? That smells like extortion.
- rahimnathwani 5y ago
  "Someone needs to make an HDMI internet filter, stat." An HDMI splitter might do the job. I can't imagine that both output ports would support two-way communication with the input: https://www.amazon.com/gp/product/B079LMPSKS/ https://www.amazon.com/gp/product/B079LMPSKS/
- bsilvereagle 5y ago
  > Someone needs to make an HDMI internet filter, stat. Bunnie's NeTV is off to a good start! https://www.bunniestudios.com/blog/?cat=17 https://www.bunniestudios.com/blog/?cat=17
- arp242 5y ago
  I had no idea HDMI could even do Ethernet. Can't you configure the ROKU to not create the bridge interface or whatnot to the HDMI? Or doesn't it give that kind of control and will just connect no matter what?
- jacobkg 5y ago
  I’ve had good luck with projectors. They are starting to get smartTV components added but there are still plenty that don’t, e.g Benq
- conductr 5y ago
  Wow. Mind blowing. I am real big on the never give my TV WiFi password but just recently bought a new TV. It’s been getting firmware updates and I could not figure out how. Got the latest HDMI 2.1 for the XBox.
- joenathanone 5y ago
Danieru 5y ago
Semi-Off-Topic but related to Opex vs Capex: One of the weird aspects of Japanese tax law is the Capital Assets tax. Every year your local city taxes any capital goods at 1.5%. What is a capital good? Anything which takes multiple years to deduct. A couple examples: Cars, Machines, Factories. A couple odd examples: desks, chairs, TV, elevators. In the past other first world countries had such capital goods taxes but removed them. It seems so counter intuitive to punish companies for building capital. After all capital and acculumation of capital is what pushes productivity. I suspect it, as so many other aspects of Japanese tax law, is about solving perverse incentives: no one goes around misclassifying opex as capex when there is a capex tax...
- gruez 5y ago
  >It seems so counter intuitive to punish companies for building capital. After all capital and acculumation of capital is what pushes productivity. OTOH, wealth taxes seem to be gaining popularity in the western world. Maybe we're going full circle?
  - Danieru 5y ago
    Indeed, I almost wrote wealth tax when describing the tax. The difference being I think that capital goods in relation to taxes are most about depreciation. The capital account is meant to be decreasing. The business optimal situation is for a capital good's book value to reach 0 while the productive use continues unchanged. Thus the business got to buy the machine without paying income taxes on the investment. Thus from the tax office's perspective handling of capital goods is about preventing too-fast depreciation and or over investment. By such logic any dollar spent on capital goods is a dollar not booked at profit and thus taxed. About 1/3 of Japan's national tax revenue comes form corporate income tax. Oddly enough, while the capital goods tax is levied by the town, towns do not control their own tax policy. Instead the federal level dictates the exact tax rates down to the prefectural and city level. Thus in Japan there is little room for the tax centric competition we see in the US. Towns cannot negotiate tax exceptions with industry. Instead the only instances of regional tax preferences in force now were written at the federal level to give various incentives to rebuild the Touhoku region after the tsunami of 2011. Thus while the town may tax capital goods it is the federal tax authority (NTA) which benefits from the increase in profits.
kasperset 5y ago
Also like to add the fitness products such as Peloton and Hydrow to this hidden subscription category.
Ballu 5y ago
When I moved to US in late '90s, my mentor told the Milk distribution story/change (NY/NJ). During his grandfather times (I am sure around 1950/60s, Milkman used to enter the home and check how much milk is needed and change the bottle. With time, few crimes and privacy concepts started coming into picture, the milks bottles were left outside. And now Amazon wants to enterr your home to do exactly what milkman used to do 60-70years back.
- DJBunnies 5y ago
  I don’t want Amazon in my house, but this is contrived. Determining what you need replaced and fulfilling it != secure delivery of what you ordered yourself.
- greggman3 5y ago
  speaking of coming into your house (and completely off topic), TIFU by using a KeyMe kiosk. I needed a copy of a key. I expected it was a mechanical copier which I'd seen before. Instead it's some kind of digital kiosk that scans the key and then, sends the info to their servers and they mail you a key. In other words, they have a database of people's keys and the address those keys belong too. I feel so stupid. Time to change my locks.
  - TeMPOraL 5y ago
    Right. It's a scary world these days. I've recently noticed that my first, instinctive reaction to any new business idea in physical space is to look what information about me it can observe and where can it go. I started to actively avoid anything involving Internet-connected computers. As in your case: the kiosk sends a key scan and your address to some company. It's just one infosec fuckup from giving your local thieves a time of their lives.
  - yosito 5y ago
    Jesus Christ!
  - CRConrad 5y ago
    > TIFU TIL.
vvarren 5y ago
I just canceled one of my credit cards and then started getting DOZENS of emails from services warning me that they were canceling soon. It is absolutely stunning to me how many different subscriptions were flying under the radar. Sneaky sneaky! Huge shoutout to Adobe for making a stellar product but come on... I need it for so much that it is basically like paying rent.
- voiper1 5y ago
  I have capitalone configured to send me an email for any charge made on my card. (Now I get push too.) No reason for surprises.
KingOfCoders 5y ago
I now have a CP2025 for a decade, no problems, before I had another large HP for over a decade, only dropped it because the new one is a color printer.
wly_cdgr 5y ago
The worst of these is a house
- tonyedgecombe 5y ago
  House, car, partner, children, coffee machine, razor, … They all require ongoing expense.
matheusmoreira 5y ago
> My favourite example of this are the "smart" televisions that one day decided, all on their own, to start showing their adverts: a new, recurring psychic cost for their subscribers, who had thought they were owners. Nice perspective, never thought about it that way. My hate for the companies that do this has been renewed.
alien_ 5y ago
"The average user prints exactly one colour page during the lifetime of their colour printer. It is usually the test page." So true!
- gpt5 5y ago
  Unless that user has young kids
quickthrower2 5y ago
Ink refill kits and unofficial cartridges. That’s all I’ll say :-)
geocrasher 5y ago
Fun story: My adult daughter lives at home. She does our shopping and came home one day with a toilet bowl brush that was "revolutionary" (my words based on her excitement about it) because it is refillable and can be used to clean the outside and the inside of the toilet. Recognizing this as a refill subscription, I forbade its use. It sits there, unwilling to be thrown away, and unable to be used. If not for the receipt being lost, it would have been immediately returned! If anything requires repeated payments to be useful, it's a subscription.
- datenhorst 5y ago
  Why would you want to use the toilet brush to clean the *outside* of your toilet? I struggle to make sense of this product
gmac 5y ago
On the economics of printer ink (and why competitive markets don’t fix it), this paper is a classic: https://pages.stern.nyu.edu/~xgabaix/papers/shrouded.pdf https://pages.stern.nyu.edu/~xgabaix/papers/shrouded.pdf
- CRConrad 5y ago
  Wouldn't load for me. But archive.is got through: https://archive.is/yXes0 https://archive.is/yXes0
moss2 5y ago
This was a great read, but even better was the link to an article by Nicholas Lovell at the end. I love reading thoughtful analysis of the video game industry. What a goldmine!
denton-scratch 5y ago
> all of it just lines the pockets of wealthy sysadmins. Never met one.
mschuster91 5y ago
> At the end of their 4-5 year contract these secret renters are bamboozled at the dealership and convinced to just "roll over" their deal onto a new car with much the same monthly payment and, again, no ownership. It costs considerably more to do this great rigmarole than just to buy outright. And yet, about 1/4 to 1/3rd of new cars are leased (https://www.statista.com/statistics/453122/share-of-new-vehicles-on-lease-usa/ https://www.statista.com/statistics/453122/share-of-new-vehi...), and probably more than that are financed by actual loans. Unfortunately I couldn't find data on how much of these cars were leased by companies (where it makes sense to lease that 7 series BMW for the C-level exec) and how many were leased by consumers. In any case, the why is the important thing: 70% of Americans don't have more than 1.000$ in savings (https://www.statista.com/chart/20323/americans-lack-savings/ https://www.statista.com/chart/20323/americans-lack-savings/), and probably 90% of Americans require a car because public transport is inefficient and/or unusable for their daily lives. These people don't have a realistic choice between taking on debt or not taking on debt (they need a car and don't have savings), and the result is an immensely profitable racket - the market for consumer car loans alone is 1.17 trillion $ (https://www.statista.com/statistics/453380/outstanding-automotive-loan-balances-usa/ https://www.statista.com/statistics/453380/outstanding-autom...). Even at a measly 5% interest that's 85 billion $ a year that banks extract from the poor (and likely more, given that lower credit scores yield over 10% interest!
- Normal_gaussian 5y ago
  Despite having the capital, both of our cars were purchased on finance deals. For my car (3yo at purchase) an outright purchase was the same price as total cost of finance, so I financed. For my partners car (new) it worked out significantly cheaper to finance as they 'match' the scrappage deal of the old (very broken) car. Whilst most finance deals are scams, there are good ones. In our case double dipping on scrappage and sourcing a second hand car from a cheaper geography certainly played a part; and for once I'm sure I'm not deluded - with a family member running their own dealership we had quite the inside look at alternatives. That said, an ongoing profiteering racket is servicing and associated consumables. Most independents are cheaper, though it does take work to find a good one - you have to check the quality of alternative consumables.
bjarneh 5y ago
> The average user prints exactly one colour page during the lifetime of their colour printer. It is usually the test page. Guilty as charged.
habosa 5y ago
There should be a law that states for any subscription product I should be allowed to buy a fixed-term version with no auto-renewal. In the past two days I've had the following experiences: * Wanted to buy a Font Awesome "Pro" license for their icons. The only way to do this is a 99/year subscription. Reading the fine print says that I can buy it and cancel it the next day and still have lifetime access to the version at the time of my purchase. Why make me jump through the hoops? * I wanted to support a writer on Substack by subscribing for a year. But I can't, I can only start a perpetual sub. So I subbed and canceled 1 day later. Then I got a "why did you cancel?" email. I didn't really * I saw a cool open source project I liked and wanted to donate. They only had a Patreon link. Patreon only has recurring subs. So I had to email them and ask for their PayPal so I could send them $100. I really wonder how much of SaaS revenue is people who have forgotten to cancel. I would guess 25% industry-wide.
- ianai 5y ago
  Agree. Wish there were more backlash on this.
- srigi 5y ago
  In similar cases (me not wanting to recurring payment to happen) I just create a new virtual credit card in Revolut and dispose it right after purchase. Passing a physical credit card info to services is like giving them universal key to my house. After some years I don't know who does have a key to my house, and I'm just living with fear that someday I find an empty house.
rm445 5y ago
Interesting point about car PCP financing at the end of the article. I bought a car through a PCP a few years back (a new 2013 Mazda) and it seemed fairly humane: - Nominally 0% interest (albeit we paid sticker price of the vehicle with no discount). - Deposit + payments such that the car was never 'under water'. In fact, subject to some heavy caveatting about its condition, I think we could have handed the car back and walked away from the agreement at any time, something almost unheard-of in American-style car loans. - At the end of the PCP period, there was still a big balloon payment, which is how they get you rolling onto a new car+contract of course. But it was a known quantity that was possible to save up for, and due to the monthly payments, as mentioned above, being of sufficient size, the balloon payment was much less than the cost to buy the same car in same age/condition/etc on the open market, so it made sense to pay the money and keep the car. There are a couple of things I find interesting about the above. One is that I perceived some benefits from the monthly payments being larger rather than smaller - when considering time value of money etc this is presumably irrational. But people do seem to genuinely suffer from upside-down car loans, where they could 'afford' the payments but find themselves trapped making them on an un-sellable vehicle. I guess what I'm saying is the payments were set at a level where I could actually afford the car. The other interesting thing is how easily the formula could be tweaked to make more expensive cars look affordable, and to incentivise rolling onto another contract. The flip side is that such tweaks let the purchaser have a lower payment, or a nicer car for the same payment, but might not be in the purchaser's rational best interest.
jrootabega 5y ago
Another product that does this: video games. Games like Destiny are sold at full price and then ALSO require semiyearly purchases to retain access to the content you bought. Technically each purchase cycle provides new content, but you always lose access to something you had.
nucatus 5y ago
The "printer refill scam" was just an example of how a product is turn into a service. Funny to see the post being ignored just because people are so mad at printers.
tofukid 5y ago
It’s just too much money for business owners to leave on the table, despite being a dark pattern. Even if a product doesn’t necessitate a subscription, the revenue compounds, so subscriptions can be 10-100x the revenue of a one-time charge.

463 points by calpaterson 5y ago

k__ 5y ago

I was never good at accounting stuff. Do I generally want to move as much as possible to OPEX, so I don't have to pay any taxes in the end?

nimbius 5y ago

>it looks like a product but secretly a subscription Surely this isnt about playdate.

Elidrake24 5y ago
Can’t see how it would be; you pay up front to own (lifetime access without need to check a DRM server) X amount of games which are released to you over time. If you want another Y amount of games, you can pay again, or you can just keep what you’ve already bought. Closer to their point would be the battery or the mechanism behind the crank that will inevitably fail.
hug 5y ago
This is a bit of a weird derail, presumably because you don't like the idea of the Playdate, but it's worth pointing out that the subscription, in the case of Playdate, works much like milk: It's better as a subscription. But Playdate is both parts. It's a device built to host a subscription, but the subscription itself only works to support the device. The device is built with deliberate constraints to provoke creativity in game design, and that creativity in game design is what you subscribe to. It's the milk bottle and the milk. The thing is that no one is buying a Playdate without being aware of what they're getting. There's no hidden catches or unadvertised subscription fees. You can, if you want, just buy a Playdate and sideload content onto it, although you won't get the next season's games and the thing that makes the device special in a lot of people's minds. Without it, you will never get to play Lucas Pope's next game. Without it, Lucas Pope would never make a handheld game operated by a crank. Does this mean anything to you? Maybe not. If it doesn't, don't buy it and don't subscribe. You probably also don't subscribe to my favourite magazine, Scrimshander's Monthly. People have different interests, and find lots of different things cool, and that's okay.
- Danieru 5y ago
  > The thing is that no one is buying a Playdate without being aware of what they're getting. Nonsense, no one knows anything about future subscriptions aka "what they are getting". How can consumers be fully informed when nothing is announced? The PlayDate will have an astronomically small install base. Amortizing a dozen game's developments over such a small install base without subsidy from Panic will surely lead to sticker shock. There are 21 titles in the first season. At a mere 50K USD per title (small even for indie dev budgets) that is 1,050K USD to develop the season. With 20K sold play dates that's a per device cost of 50$, or about 100$ for a year of releases. Can the playdate justify a 8$ per month subscription? Yeah I think so, but only because it is a pure novelty. Except novelties have a habit of being low commitement. If only 25% of units re-sub that puts your per sub development costs at 400$ a year. Are Playdate owners going to be happy to pay 2x the cost of the device for a single year of games? Obviously not. The playdate needs to move more units or it will die, I don't think current buyers understand this risk at _all_.
  - hug 5y ago
    No one knows anything about the financials of the thing but you do know what you're getting: A unique little handheld, with 21 unique-to-the-platform indie games, at known price point, and a promise that they're gonna try to put out seasons of games. What you might get thereafter being entirely unknown (other than it being a device-bespoke set of games for some price) is exciting. Maybe the subscription will be too pricey to stomach. Maybe they'll go tits up. Maybe it'll be a complete commercial flop. Maybe, on the other hand, they've already sold 100,000 devices and manage an attach rate of 65% at $5 a month and they make that million a quarter to fund games. Maybe it's $20 a 3 month season and they've got even more in their pocket. Who knows, but I'm still excited.
    - Danieru 5y ago
      Yeah okay you've convinced me, the play date is pretty cool. Its working against the odds but I love the quirky and open platform aspects.

Waterluvian 5y ago

A lot of good thoughts in here. The one I personally want everyone to take away is that most plastics are not recycled. Unless it’s glass, fibre, or aluminum, you are lying to yourself if it’s going into the blue bin. Glass-contained milk delivery seems great. Someone needs to start a company. Sure it won’t be sexy or use AI but it’s useful. I have a local co-op that delivers local produce. It’s amazing to see a pile of naked produce show up in a repurposed apple crate.

reilly3000 5y ago
Staples-as-a-Service. I would totally buy that service vs overpriced meal boxes or on-demand grocery delivery. An app could be used to coordinate your order/inventory levels, and a reusable cooler could sit on your porch or lobby for exchange and temp storage. Pop a cheap tracker and lock in it if piracy is an issue. There are major efficiencies associated with route delivery vs on-demand ordering- pick&pack in batches, delivery in batches, consistent staffing needs, etc. somebody should pitch this for Winter 2022!
- BLKNSLVR 5y ago
  Nit: Theft may be a more accurate term than piracy. Arrrr, through my spyglass I did sight a hearty meal on thy dock, and being as I am a ravenous, immoral beast I bent my sails against the wind to secure it as my prize. But thwarted I were by a hidden RFID and three days hence arrested by a regiment of dirty british redcoats. But, upon mine hanging, my belly were full and thine empty.
  - reilly3000 5y ago
    Yar. Porch pirates are a scourge of the seven streets to be sure... RFID is no match, but GPS + Cell could finally bring justice to these shores. https://www.aliexpress.com/item/4000235765025.html https://www.aliexpress.com/item/4000235765025.html That plus a little lock system might just do it, but at some point its cheaper just to redeliver stuff than worry about reusable containers being stolen, especially when you have to figure out how to power the damn thing and get a ton of cheap SIMs+plans.

eric4smith 5y ago

Hehe - disposable razors (with the removable head) are also a kind of subscription. Good piece. So many things are hidden subscriptions these days, even when they don’t have a need to be. It’s so obviously a money grab.

BLKNSLVR 5y ago
Worth reading the whole article, I'm only referencing a couple of specifics. The very last sentence of the article is what it was all leading to, and excellently summed up into what is a modern recurring theme: good business practice is consumer-unfriendly practice. I thought this was specifically called the "Gillette Business Model". Reading the relevant wikipedia page[0], which also mentions printers and ink, calls it the "razor and blade" model. One must also familiarise oneself with the "Machine that goes ping" Monty Python skit (on YT, watch it, it's much better than just reading the relevant quote). It was my first introduction to the complexities of corporate finance: "Ah, I see you have the machine that goes 'ping!'. This is my favourite. You see, we lease this back from the company we sold it to - that way it comes under the monthly current budget and not the capital account"[1] [0]: https://en.wikipedia.org/wiki/Razor_and_blades_model https://en.wikipedia.org/wiki/Razor_and_blades_model [1]: https://en.wikiquote.org/wiki/Monty_Python%27s_The_Meaning_of_Life https://en.wikiquote.org/wiki/Monty_Python%27s_The_Meaning_o...
- toyg 5y ago
  I almost lost a friendship on discussing that "good business is consumer-unfriendly". Because it fundamentally alters one's view of the consumerist-capitalism society we live in, it's very hard to accept for anyone invested in the system, even slightly. if one accepts that fact, then the question becomes: is there a level of user-unfriendliness that is morally acceptable? Or is it all pure and simple exploitation? Which cannot be logically answered in a clear and simple way; we just accept the status quo because we think any potential alternative would be worse, which we have no way of knowing.
askvictor 5y ago
Even the older double-edged safety razors were designed around such a model, but at least there is a 'standard' for those, with plenty of different companies producing interoperable consumables. Would it be fair to say that any product with consumables that are proprietary to the vendor, is a subscription?

Zababa 5y ago

Other submission here https://news.ycombinator.com/item?id=28037039 https://news.ycombinator.com/item?id=28037039. For some reason, algolia adds 10 hours to the submission time, this one that's 1 hour ago according to HN is marked as 11 hours ago, and the other that's 10 hours ago according to HN is marked as 20 hours ago.

gruez 5y ago
It's something to do with the "second chance" mechanism. Here's the email I gotten from dang explaining the issue: >It's an artifact of the re-upping system. '1 day ago' was the original submission time and '1 hour ago' was the re-up time. Lots of explanation here: https://hn.algolia.com/?dateRange=all&page=0&prefix=true&query=by%3Adang%20timestamps&sort=byDate&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=true&que.... Sorry for the confusion! >See also https://news.ycombinator.com/item?id=11662380 https://news.ycombinator.com/item?id=11662380 and links back from there.
- Zababa 5y ago
  Thanks!

paxys 5y ago

Great article. One minor point of disagreement I have: > For Adobe's subscribers, the lock-in is considerable as access to their existing bank of files and documents is contingent on continued payment. Losing access to uploaded files isn't really a relevant factor in paying for an Adobe subscription. Their cloud storage is an afterthought, and they can all anyways be trivially exported. The lock-in comes from the software itself. We must have Photoshop, and there is no other way to get Photoshop than to pay Adobe every month till you die.

infogulch 5y ago
That's not really a disagreement, I think that's what the author meant.
legohead 5y ago
also, once you realize you hardly use photoshop and cancel your subscription, you get a fat cancellation fee. so do you pay the cancel fee, or "maybe I'll need photoshop, who knows?"
ludocode 5y ago
I don't think he meant losing access to cloud storage. He meant losing the ability to open your files. It makes little difference whether you're storing the files yourself because you can't open them without Photoshop.

dsr_ 5y ago

Printers. Yeah. Herewith, my standard advice. Buy a Brother monochrome laser with duplex, an ethernet port, and BRScript/3 (their PostScript clone). Even if you're sure you will never need one or more of those features, get them all. Wifi and Bluetooth and NFC are strictly optional, and probably not worthwhile. If you need color printing, send it to a printing company. There might even be a local one. It will be done at a higher quality, with better ink and good paper, than you can do at your office or house -- unless you are big enough to utilize a whole flock of printers, or you are a professional. If you are a pro, you don't need this advice.

temporallobe 5y ago
My wife started her PhD program a few years ago and printed nearly all of her resources on our inkjet printer at the time - only to recycle all of it after the class was completed. We were spending ridiculous amounts of money and constantly going out to buy the darn cartridges. I don’t know why, but I had completely forgotten about laser printers, then one day I suddenly remembered from my childhood school days that everyone used laser printers, did some research, and bought one. The cost was more than triple that of a decent inkjet, but nearly three years later, and she has only had to buy maybe two toner cartridges and the darn thing is extremely reliable. Personally I wish she didn’t have to print so much, but it helps her quickly annotate, locate, and visualize large amounts of literature.
NortySpock 5y ago
Great advice, and I echo 95% of it. My observation is that I have found Wifi useful when I need the printer in an odd location in the house, and color is useful for non-professional usage like "the kids need to print out their report for school" and "the med school student needs anatomy diagrams in color" My trusty color Brother laser HL-3170CDW cost ~$300 at the time and has been trucking along for 7+ years now without a hiccup. If it dies, I'm replacing it with another Brother laser printer. EDIT: added cost of printer. The article is right: if all you are ever going to do is print your taxes and financial documents once a year, a ~$100 monochrome laser printer is fine.
- 5y ago

PretzelPirate 5y ago

> …so if you are into your environmentalism then milk is the SaaS for you. Dairy isn’t know for being great for the environment.

yinyang_in 5y ago
Imo dairy isn't good if done via industry model i.e. central company provides value for all. All cow in central place, profit oriented. Old cows thrown for slaughter, it becomes very inhumane. Coming from village where cow is part of family and treatment like family and has name as we do, then same dairy become very beautiful relationship.
- selectnull 5y ago
  When that named cow gets old and dies, does it get buried in the family cemetery along with the rest of the family? Do you mourn for it? Or perhaps, it turns into a steak of some form or another?
- wutwutwutwut 5y ago
  Why would having the cow part of the family be any better from an environmental point of view?
- rasguanabana 5y ago
  You do realize that in order to get milk from a cow there is a precondition that ultimately leads to slaughter anyway? Unless you can afford keeping every calf and won’t exploit them for milk further.
bbojan 5y ago
Cattle is key for regenerative agriculture. See also Allan Savory's Holistic management.
- PretzelPirate 5y ago
  Cows can exist without a dairy industry. The works used to use many wild ruminants whose existence naturally helped maintain the ecosystem.

cletus 5y ago

Printers are just another example of how effective loss leaders are in selling products (or subscriptions if you want to call them that). Classic example: fast food burgers are typically sold at or near cost. It's the fries and drinks where they make all their money. It's also why accessory sales are so prevalent. I've heard of $800 cameras being sold for <$10 profit but a $1 UV filter is sold for $20.. And then there's the whole extended warranty "scam". By the way, staff in Best Buy and the like are typically judged on how many warranties they sell, not how many products. That's why such places push them so hard. Anyway, one thing I want to say about printers is that in the "home" end of the market there are really two types of printers: 1. Cheap printers intended to get customers into a cycle of buying expensive ink. These printers are typically sold near or even below cost. They may even cost less than a full set of replacement ink but you should know the printer rarely comes with full cartridges. Honestly, I would completely avoid this kind of printer. It's worth noting that these printers are designed to go through ink as fast as possible. This includes using the ink to clean the print heads every day so you'll run out of ink after some months even if you've never printed a page; and 2. So-called tank printers. These have a higher duty cycle and are more expensive. Instead of cartridges you typically fill them with bottles of ink (and much more of it than you'd typically find in a cartridge). These don't have the same ink-selling focus the first category has. If you print at all just buy a tank printer. As for add-on services like Adobe's cloud... I mean does anyone really trust Adobe with this? For the record, I'm a big fan of the _idea_ of software subscriptions. I know some people like to own their software outright but software requires constant maintenance. Security fixes, bug fixes, supporting new devices, that sort of thing. A sticker price and that's it creates perverse incentives for the company to end-of-life your software so you have to buy an upgrade. It's better to just pay a hopefully reasonable ongoing fee. The gold standard for software subscriptions is Jetbrains. You get 3 major releases a year, annual or monthly subscriptions and when you stop paying you get to keep old versions forever. Compare that to Adobe's Photoshop and Lightroom... yeesh. Adobe's idea of reasonable pricing is monthly cost = sticker price / 12. Oh and you have to sign up for a year, get auto-renewed and it's difficult to cancel.

BLKNSLVR 5y ago
Got the extended warranty on a Samsung TV once. It was a relatively small percentage to add to the purchase price, so said 'yes' when I would normally say 'no'. That warranty ended up being very worthwhile as the panel developed the vertical lines problem, after 18 - 24 months - got a full replacement TV as the purchased model was no longer 'current' or able to be serviced. The replacement eventually got the vertical lines as well, still inside the 5-year (I think) warranty period - got another replacement, which is still going strong. The original TV, with extended warranty, was purchased probably ten years ago. Another cost to factor in with an extended warranty is the time / hassle to actually make the claim. Claiming the warranty on the second TV failure required some argumentative firmness.

mrfusion 5y ago

It’s sad to think a tesla might fall into this category.

gordon_freeman 5y ago

This would sound strange but the biggest subscription I pay annually (which does not seem like a subscription) is my DMV registration renewal fees. It comes around $300+ every year out-of-the-blue in my mailbox and I realize then that is indeed a subscription for a product which is my Car that I never thought about.

odux 5y ago
So taxes are subscription to living in a city/country? Kind of, but you can opt out of subscriptions.
- em-bee 5y ago
  well you can opt out of the DMV subscription by getting rid of the car and use public transport. and just like ditching your printer, it does not work for everyone
- TeMPOraL 5y ago
  Essentially, yes. Not for just living, but also for having free access to all the services provided by the government/municipality.
the_pwner224 5y ago
From a practical persepctive you are indeed correct. In 99.9% of cases - the DMV are effectively a subscription expense you need to pay to use your car. But they're not actually a subscription to your car; the fees are a subscription to the roads and associated infrastructure, which do need constant upkeep. If you had a vehicle which was only used off-road (for example, on privately owned racetracks) and was only transported on a trailer then you would not need to register or insure it. For track motorcycles it's even relatively common to buy/sell them used without a title - so $0 fees to the government. Obviously exact laws on this may vary depending on location.
nonameiguess 5y ago
Property tax has to be more than that. Even if you don't own your residence, whatever the landlord passes through to tenants is going to be more than $300 a year.

taurath 5y ago

> Good business sense is to do only what is reasonable for yourself but great business sense is to make others do what is not. I think its interesting to meditate for a moment on the great amount of meaning in the closing sentence here. Great business sense by this definition seems inherently immoral and extractive rather than productive for one. Secondly the it seems quite the antithesis of competition under free capitalism producing better outcomes - the effects of concentrations and imbalances of power is something that is frequently left out of those debates. I think that we should try to strive for a world where good and moral business sense is better rewarded than great business sense.

lwansbrough 5y ago
> I think that we should try to strive for a world where good and moral business sense is better rewarded than great business sense. This stuff gets outcompeted by the free market every time. You don’t have to look far to find failed attempts to plan economies around the morals du jour. The whole point of free market capitalism is it’s game theory - if something worked better anybody would be free to use that better method. Humans have a consensus on what better means, and free markets are structured around that (+ a sane amount of government oversight because humans act dumb at scale.)
- taurath 5y ago
  The structure of the market is such that massive scale and non-local business has been winning out lately, but that has not always been the case. I’m not arguing against capitalism here (plenty of arguments to be made tho), but against the incentives of our current policies.
- CRConrad 5y ago
  When market mechanisms lead to a sub-optimal outcome "within" the economy, that's called a "market imperfection" or "market failure". The fact that these things exist show that "the free market", while perhaps the best system ([Citation needed]) is certainly not perfect. On the meta-level, should the fact that "the free market" wins out even though it is perhaps not the best system -- at least according to many (most?) people's morals "du jour", however long that is -- be called a "meta-market imperfection" or a "market meta-failure"?

SavantIdiot 5y ago

He mentions "Smart TVs". I always thought you could just buy a SmartTV and not connect the internet and have a dumb TV. Nope. HDMI changed that. I bought a TV a few months ago and it started showing adverts because it was connected to the internet through my ROKU via HDMI. That's right, you can't even have a dumb TV anymore. Someone needs to make an HDMI internet filter, stat. But Adobe? That smells like extortion.

rahimnathwani 5y ago
"Someone needs to make an HDMI internet filter, stat." An HDMI splitter might do the job. I can't imagine that both output ports would support two-way communication with the input: https://www.amazon.com/gp/product/B079LMPSKS/ https://www.amazon.com/gp/product/B079LMPSKS/
bsilvereagle 5y ago
> Someone needs to make an HDMI internet filter, stat. Bunnie's NeTV is off to a good start! https://www.bunniestudios.com/blog/?cat=17 https://www.bunniestudios.com/blog/?cat=17
arp242 5y ago
I had no idea HDMI could even do Ethernet. Can't you configure the ROKU to not create the bridge interface or whatnot to the HDMI? Or doesn't it give that kind of control and will just connect no matter what?
jacobkg 5y ago
I’ve had good luck with projectors. They are starting to get smartTV components added but there are still plenty that don’t, e.g Benq
conductr 5y ago
Wow. Mind blowing. I am real big on the never give my TV WiFi password but just recently bought a new TV. It’s been getting firmware updates and I could not figure out how. Got the latest HDMI 2.1 for the XBox.
joenathanone 5y ago

Danieru 5y ago

Semi-Off-Topic but related to Opex vs Capex: One of the weird aspects of Japanese tax law is the Capital Assets tax. Every year your local city taxes any capital goods at 1.5%. What is a capital good? Anything which takes multiple years to deduct. A couple examples: Cars, Machines, Factories. A couple odd examples: desks, chairs, TV, elevators. In the past other first world countries had such capital goods taxes but removed them. It seems so counter intuitive to punish companies for building capital. After all capital and acculumation of capital is what pushes productivity. I suspect it, as so many other aspects of Japanese tax law, is about solving perverse incentives: no one goes around misclassifying opex as capex when there is a capex tax...

gruez 5y ago
>It seems so counter intuitive to punish companies for building capital. After all capital and acculumation of capital is what pushes productivity. OTOH, wealth taxes seem to be gaining popularity in the western world. Maybe we're going full circle?
- Danieru 5y ago
  Indeed, I almost wrote wealth tax when describing the tax. The difference being I think that capital goods in relation to taxes are most about depreciation. The capital account is meant to be decreasing. The business optimal situation is for a capital good's book value to reach 0 while the productive use continues unchanged. Thus the business got to buy the machine without paying income taxes on the investment. Thus from the tax office's perspective handling of capital goods is about preventing too-fast depreciation and or over investment. By such logic any dollar spent on capital goods is a dollar not booked at profit and thus taxed. About 1/3 of Japan's national tax revenue comes form corporate income tax. Oddly enough, while the capital goods tax is levied by the town, towns do not control their own tax policy. Instead the federal level dictates the exact tax rates down to the prefectural and city level. Thus in Japan there is little room for the tax centric competition we see in the US. Towns cannot negotiate tax exceptions with industry. Instead the only instances of regional tax preferences in force now were written at the federal level to give various incentives to rebuild the Touhoku region after the tsunami of 2011. Thus while the town may tax capital goods it is the federal tax authority (NTA) which benefits from the increase in profits.

kasperset 5y ago

Also like to add the fitness products such as Peloton and Hydrow to this hidden subscription category.

Ballu 5y ago

When I moved to US in late '90s, my mentor told the Milk distribution story/change (NY/NJ). During his grandfather times (I am sure around 1950/60s, Milkman used to enter the home and check how much milk is needed and change the bottle. With time, few crimes and privacy concepts started coming into picture, the milks bottles were left outside. And now Amazon wants to enterr your home to do exactly what milkman used to do 60-70years back.

DJBunnies 5y ago
I don’t want Amazon in my house, but this is contrived. Determining what you need replaced and fulfilling it != secure delivery of what you ordered yourself.
greggman3 5y ago
speaking of coming into your house (and completely off topic), TIFU by using a KeyMe kiosk. I needed a copy of a key. I expected it was a mechanical copier which I'd seen before. Instead it's some kind of digital kiosk that scans the key and then, sends the info to their servers and they mail you a key. In other words, they have a database of people's keys and the address those keys belong too. I feel so stupid. Time to change my locks.
- TeMPOraL 5y ago
  Right. It's a scary world these days. I've recently noticed that my first, instinctive reaction to any new business idea in physical space is to look what information about me it can observe and where can it go. I started to actively avoid anything involving Internet-connected computers. As in your case: the kiosk sends a key scan and your address to some company. It's just one infosec fuckup from giving your local thieves a time of their lives.
- yosito 5y ago
  Jesus Christ!
- CRConrad 5y ago
  > TIFU TIL.

vvarren 5y ago

I just canceled one of my credit cards and then started getting DOZENS of emails from services warning me that they were canceling soon. It is absolutely stunning to me how many different subscriptions were flying under the radar. Sneaky sneaky! Huge shoutout to Adobe for making a stellar product but come on... I need it for so much that it is basically like paying rent.

voiper1 5y ago
I have capitalone configured to send me an email for any charge made on my card. (Now I get push too.) No reason for surprises.

KingOfCoders 5y ago

I now have a CP2025 for a decade, no problems, before I had another large HP for over a decade, only dropped it because the new one is a color printer.

wly_cdgr 5y ago

The worst of these is a house

tonyedgecombe 5y ago
House, car, partner, children, coffee machine, razor, … They all require ongoing expense.

matheusmoreira 5y ago

> My favourite example of this are the "smart" televisions that one day decided, all on their own, to start showing their adverts: a new, recurring psychic cost for their subscribers, who had thought they were owners. Nice perspective, never thought about it that way. My hate for the companies that do this has been renewed.

alien_ 5y ago

"The average user prints exactly one colour page during the lifetime of their colour printer. It is usually the test page." So true!

gpt5 5y ago
Unless that user has young kids

quickthrower2 5y ago

Ink refill kits and unofficial cartridges. That’s all I’ll say :-)

geocrasher 5y ago

Fun story: My adult daughter lives at home. She does our shopping and came home one day with a toilet bowl brush that was "revolutionary" (my words based on her excitement about it) because it is refillable and can be used to clean the outside and the inside of the toilet. Recognizing this as a refill subscription, I forbade its use. It sits there, unwilling to be thrown away, and unable to be used. If not for the receipt being lost, it would have been immediately returned! If anything requires repeated payments to be useful, it's a subscription.

datenhorst 5y ago
Why would you want to use the toilet brush to clean the *outside* of your toilet? I struggle to make sense of this product

gmac 5y ago

On the economics of printer ink (and why competitive markets don’t fix it), this paper is a classic: https://pages.stern.nyu.edu/~xgabaix/papers/shrouded.pdf https://pages.stern.nyu.edu/~xgabaix/papers/shrouded.pdf

CRConrad 5y ago
Wouldn't load for me. But archive.is got through: https://archive.is/yXes0 https://archive.is/yXes0

moss2 5y ago

This was a great read, but even better was the link to an article by Nicholas Lovell at the end. I love reading thoughtful analysis of the video game industry. What a goldmine!

denton-scratch 5y ago

> all of it just lines the pockets of wealthy sysadmins. Never met one.

mschuster91 5y ago

> At the end of their 4-5 year contract these secret renters are bamboozled at the dealership and convinced to just "roll over" their deal onto a new car with much the same monthly payment and, again, no ownership. It costs considerably more to do this great rigmarole than just to buy outright. And yet, about 1/4 to 1/3rd of new cars are leased (https://www.statista.com/statistics/453122/share-of-new-vehicles-on-lease-usa/ https://www.statista.com/statistics/453122/share-of-new-vehi...), and probably more than that are financed by actual loans. Unfortunately I couldn't find data on how much of these cars were leased by companies (where it makes sense to lease that 7 series BMW for the C-level exec) and how many were leased by consumers. In any case, the why is the important thing: 70% of Americans don't have more than 1.000$ in savings (https://www.statista.com/chart/20323/americans-lack-savings/ https://www.statista.com/chart/20323/americans-lack-savings/), and probably 90% of Americans require a car because public transport is inefficient and/or unusable for their daily lives. These people don't have a realistic choice between taking on debt or not taking on debt (they need a car and don't have savings), and the result is an immensely profitable racket - the market for consumer car loans alone is 1.17 trillion $ (https://www.statista.com/statistics/453380/outstanding-automotive-loan-balances-usa/ https://www.statista.com/statistics/453380/outstanding-autom...). Even at a measly 5% interest that's 85 billion $ a year that banks extract from the poor (and likely more, given that lower credit scores yield over 10% interest!

Normal_gaussian 5y ago
Despite having the capital, both of our cars were purchased on finance deals. For my car (3yo at purchase) an outright purchase was the same price as total cost of finance, so I financed. For my partners car (new) it worked out significantly cheaper to finance as they 'match' the scrappage deal of the old (very broken) car. Whilst most finance deals are scams, there are good ones. In our case double dipping on scrappage and sourcing a second hand car from a cheaper geography certainly played a part; and for once I'm sure I'm not deluded - with a family member running their own dealership we had quite the inside look at alternatives. That said, an ongoing profiteering racket is servicing and associated consumables. Most independents are cheaper, though it does take work to find a good one - you have to check the quality of alternative consumables.

bjarneh 5y ago

> The average user prints exactly one colour page during the lifetime of their colour printer. It is usually the test page. Guilty as charged.

habosa 5y ago

There should be a law that states for any subscription product I should be allowed to buy a fixed-term version with no auto-renewal. In the past two days I've had the following experiences: * Wanted to buy a Font Awesome "Pro" license for their icons. The only way to do this is a 99/year subscription. Reading the fine print says that I can buy it and cancel it the next day and still have lifetime access to the version at the time of my purchase. Why make me jump through the hoops? * I wanted to support a writer on Substack by subscribing for a year. But I can't, I can only start a perpetual sub. So I subbed and canceled 1 day later. Then I got a "why did you cancel?" email. I didn't really * I saw a cool open source project I liked and wanted to donate. They only had a Patreon link. Patreon only has recurring subs. So I had to email them and ask for their PayPal so I could send them $100. I really wonder how much of SaaS revenue is people who have forgotten to cancel. I would guess 25% industry-wide.

ianai 5y ago
Agree. Wish there were more backlash on this.
srigi 5y ago
In similar cases (me not wanting to recurring payment to happen) I just create a new virtual credit card in Revolut and dispose it right after purchase. Passing a physical credit card info to services is like giving them universal key to my house. After some years I don't know who does have a key to my house, and I'm just living with fear that someday I find an empty house.

rm445 5y ago

Interesting point about car PCP financing at the end of the article. I bought a car through a PCP a few years back (a new 2013 Mazda) and it seemed fairly humane: - Nominally 0% interest (albeit we paid sticker price of the vehicle with no discount). - Deposit + payments such that the car was never 'under water'. In fact, subject to some heavy caveatting about its condition, I think we could have handed the car back and walked away from the agreement at any time, something almost unheard-of in American-style car loans. - At the end of the PCP period, there was still a big balloon payment, which is how they get you rolling onto a new car+contract of course. But it was a known quantity that was possible to save up for, and due to the monthly payments, as mentioned above, being of sufficient size, the balloon payment was much less than the cost to buy the same car in same age/condition/etc on the open market, so it made sense to pay the money and keep the car. There are a couple of things I find interesting about the above. One is that I perceived some benefits from the monthly payments being larger rather than smaller - when considering time value of money etc this is presumably irrational. But people do seem to genuinely suffer from upside-down car loans, where they could 'afford' the payments but find themselves trapped making them on an un-sellable vehicle. I guess what I'm saying is the payments were set at a level where I could actually afford the car. The other interesting thing is how easily the formula could be tweaked to make more expensive cars look affordable, and to incentivise rolling onto another contract. The flip side is that such tweaks let the purchaser have a lower payment, or a nicer car for the same payment, but might not be in the purchaser's rational best interest.

jrootabega 5y ago

Another product that does this: video games. Games like Destiny are sold at full price and then ALSO require semiyearly purchases to retain access to the content you bought. Technically each purchase cycle provides new content, but you always lose access to something you had.

nucatus 5y ago

The "printer refill scam" was just an example of how a product is turn into a service. Funny to see the post being ignored just because people are so mad at printers.

tofukid 5y ago

It’s just too much money for business owners to leave on the table, despite being a dark pattern. Even if a product doesn’t necessitate a subscription, the revenue compounds, so subscriptions can be 10-100x the revenue of a one-time charge.