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Report: Subscription Economy Could Be Worth $100 Billion

SaaS and cloud computing are changing the game for enterprise applications.


A report from a company called Zuora says that the "subscription economy" is a $100 billion market for IT. The subscription economy is all about signing up for services that have a monthly or annual fee. In the consumer world, it's how companies like Netflix, Hulu, Pandora and Spotify do business, and for enterprises, it's common with cloud computing and software as a service vendors.

The report predicts that 20 percent of Fortune 1000 companies will adopt subscription billing by 2020. "The 20th century Era of Products is coming to an end. People are realizing they have all the stuff they need, and there's now a chance to subscribe to services that give them the outcome they want without buying the product," Zuora CEO and founder Tien Tzuo said. "As a result, companies in publishing, media, healthcare, airlines, security, telecommunications and manufacturing are transforming into software and services businesses and, rather than focusing on shipping more product, they are instead focused on growing and monetizing a loyal customer base."

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