But this is still such a bastardization of the term “rent seeking” that is is somewhere between disingenuous and flat out lying.
By this logic, my house cleaner is rent-seeking because I pay every week, but I could do the work myself. That’s not what rent-seeking is. That is a garden variety service.
All of the anti-subscription sentiment just sounds like “I want perpetual support and updates for a one-time price”, which is just silly. It’s actually bad for the customer because once the service provider has your one-time payment, they have zero incentive to keep you as a customer.
It leads to misaligned incentives as sellers seek to expand to new markets to reach new customers while neglecting existing customers who are nothing but expense.
Further, SaaS produces net lower costs because resources can be utilized more efficiently. Great, you can do an on-premise server, but you need to spec it to support the busiest second in the busiest day of your year. Most of the time it will be underutilized.
Sorry, this whole claim is such a massive misunderstanding of Smith and SaaS that it’s making be a bit crazy.
SaaS may not be a particularly good example because like others have mentioned, there are costs to it, and it's up to you to decide whether the price is worth the convenience.
The anti-subscription sentiment is not without merit, however. Software that just runs on your computer now has a fucking subscription for no reason. Adobe, games, etc. That is rent-seeking, because I want to pay for the goddamn thing once and own it. I don't care for support or upgrades; if I do, I'll buy the newer version.
Nobody cares about the costs to offer a product. People care about the value provided.
If I think a service is worth $20 month, that will not change if their cost structure changes and suddenly it costs them $1 or $100 per month to offer. It’s worth $20 to me either way. If their cost becomes $1, I rely on competition to create the consumer surplus.
By this logic, my house cleaner is rent-seeking because I pay every week, but I could do the work myself. That’s not what rent-seeking is. That is a garden variety service.
All of the anti-subscription sentiment just sounds like “I want perpetual support and updates for a one-time price”, which is just silly. It’s actually bad for the customer because once the service provider has your one-time payment, they have zero incentive to keep you as a customer.
It leads to misaligned incentives as sellers seek to expand to new markets to reach new customers while neglecting existing customers who are nothing but expense.
Further, SaaS produces net lower costs because resources can be utilized more efficiently. Great, you can do an on-premise server, but you need to spec it to support the busiest second in the busiest day of your year. Most of the time it will be underutilized.
Sorry, this whole claim is such a massive misunderstanding of Smith and SaaS that it’s making be a bit crazy.