The ability to accept online payments has been transformed in recent years. Payment providers such as PayPal, Stripe and Zuora have made it relatively simple to accept online payments for one-off items or recurring services. The license model applied to a re-occurring service is, of course, a subscription. Whether it’s a monthly subscription to a music streaming service like Spotify, or a monthly subscription to digital news content provided by a company like The Economist, the subscription model can work well.

Among content providers, it is popular because it is simple to understand for the end customer, relatively simple to price and, if priced correctly, can also be lucrative for the content provider (note that here I am using ‘content provider’ to be any provider of digital content from applications to video, to music to text, etc).

The subscription license model is also popular because it is the main license model supported by payment providers such as Stripe and Zuora. They make it easy for content providers to deploy the model, offer discounts, track usage, process payments on a global basis, reconcile local taxes (in some cases) and easily integrate the payment engine into their own websites.

But not all types of content products are suitable for being shoehorned into a subscription model. That is to say not all products are best sold with a standard subscription model. Therefore, the subscription license model shouldn't be forced. This is particularly the case in B2B models.

Take a simulation application for example. It doesn’t really matter what is being simulated, but such an application is likely to be relatively sophisticated in composition, requires a decent amount of processing power to run and is likely to be more, rather than less expensive to purchase. It may also not be used that frequently.

In this case, a subscription model is not suitable because the end customer will be paying for something they are not actually using on a regular basis. In contrast, an ‘aggregate use time’ license model may be more appropriate as it would charge the customer based on a pre-booked amount of usage. Similarly, a ‘consumption time’ model may be appropriate if the end customer would prefer to pay on an ad hoc basis.