Subscribed

Subscriptions also don’t offer the option to buy when they conclude, which I view as a huge positive—that means that it’s in the carmaker’s interest, not yours, to keep its vehicles in great shape.

Another difference: With subscriptions, all the potentially annoying aspects of owning a vehicle (registration, insurance, maintenance) simply go away. With leases, you still have to get your own insurance.

But wait—isn’t a vehicle subscription just another word for a lease? Well, no. A lease still binds you to a specific vehicle, whereas a subscription can potentially offer you access to a range of vehicles.

Everything is covered except the gas: insurance, maintenance, wear-and-tear replacements, 24/7 customer care.

Hyundai has lots of company when it comes to automobile subscriptions. Porsche’s Passport subscription features access to half a dozen car models and covers maintenance, insurance, and vehicle tax and registration starting at $2,000 a month.

You don’t buy Hyundai’s new hybrid car the Ioniq—you subscribe to it, for $275 a month.

Much like Eric Ries’s “Lean Startup” method, they’re shortening their product development cycle through experimentation, validated learning, and iteration. And they’re creating a virtuous feedback loop whereby customer responses help inform product development. By putting it out there—and letting subscribers pay for it—these musicians are successfully feeding their sales funnels without having to wait for a finished product (although I’m sure they wouldn’t put it that way!). Instead they can tinker with their music, optimizing as part of an ongoing deployment cycle.

What happens when a static product like an album turns into a fluid service like a music stream? All sorts of interesting things. Today thousands of musicians are benefiting from platforms like Patreon that give them a steady, dependable source of recurring revenue.

For five years, NPGMC (named after Prince’s backing band, the New Power Generation) offered a monthly or annual membership that not only let fans get new releases, but also provided access to prime concert seats and passes for events like sound checks and after parties.

Ex–Sony Music CEO Edgar Berger sounded notably upbeat about the promise of paid streaming subscriptions, as well as the music business in general. He told Billboard: “The current trajectory is that the industry will inevitably grow; there’s no doubt that paid subscription will be the predominant format in the market, the one that consumers will gravitate towards. The music industry is managing three transitions at the same time: from physical to digital, PC to mobile, and download to streaming. In that context I think the industry is performing remarkably well, and with a paid subscription model we are building a business that is here to stay.”