To own or to use is not a new concept. I started grappling with this at least 12 years ago when I worked for a technology division at Sony and we developed a mobile music streaming service with Vodafone. That was in the day before iPhone was launched, before Spotify, when the iPod was on the rise. Check out the demo video I recorded.
I remember the naysayers at the time saying, no one will pay a subscription fee for a mobile service for music they don’t own. CAN YOU IMAGINE THAT???
Erich Fromm wrote To Have or to Be in 1997 – from the blurb:
To Have Or to Be? is one of the seminal books of the second half of the 20th century. Nothing less than a manifesto for a new social and psychological revolution to save our threatened planet, this book is a summary of the penetrating thought of Eric Fromm. His thesis is that two modes of existence struggle for the spirit of humankind: the having mode, which concentrates on material possessions, power, and aggression, and is the basis of the universal evils of greed, envy, and violence; and the being mode, which is based on love, the pleasure of sharing, and in productive activity. To Have Or to Be? is a brilliant program for socioeconomic change.
How does that resonate for you 22 years later, in this day and age?
The rise and shift
Consumer technologies like Spotify and Netflix are leading the way, as you’d expect. Owning vast collections of physical media is now but a niche play for most consumers. Fast followers are enterprise technology users.
Enterprise software vendors figured out pretty early on too, that there was merit in taking away the pain of build and own your own. SaaS was born. The godfather was probably Salesforce. Amazon, an online retailer, now makes $25.7 B (11%) of all its revenue from renting out the same platform it used for its own services and figured it could resell to companies wanting to run online services like it does. Smart move as it’s early days for the enterprise.
What characterises the entire shift is a move to services and solutions that can be rented (subscribed to) and used without massive outlays of capital and ownership costs and with on-demand expenditure that can be planned. They focus on delivering optimal experiences that achieve desired outcomes of the customers choice. They are less damaging to the environment because in a circular economy, the resources can be reused over and over.
I’m writing an eBook on how the trend is shifting from consumer and enterprise technology to many other industry products which are shifting to services and solutions that can be used in a subscription model. I’ve called it the As a Service trend although I didn’t invent that moniker. You can follow many posts I’m tagging that track the announcements and research on the subject. Here is an intro and subscribe to further updates there or below (see what I did there ;).
Industries like automotive are shifting to mobility as a service. Stalwarts like Ikea are looking to rent out furniture. These and many other examples will be captured and explored in the book. Come along for the ride.