Subscription bundles keep getting more expensive, and anti-piracy efforts are partially to blame

Software piracy was at its peak in the early 2000s, threatening revenue streams and intellectual property rights for software companies worldwide. Many firms used digital rights management (DRM) tools to combat this. However, DRM systems proved insufficient as piracy methods evolved, forcing companies to explore new revenue models that could secure profits while discouraging theft.

Companies turned to subscription-based bundles, which bundled products into comprehensive packages, making piracy less appealing and ensuring consistent revenue streams. A recent study revealed that many companies use shady practices. These manipulative tactics trap consumers in costly cycles. The recurring cost of subscription bundles and other subscriptions like streaming services (not to mention the cost of a streaming device) has grown into a powerful but flawed system that demands changes to balance corporate profit with consumer fairness.

The origins of subscription models

How bundling became the default for SaaS companies

The idea of subscriptions isn’t new. Services like milk deliveries and magazine subscriptions date back to the 1800s. However, the model gained significant traction in the digital era, especially in the SaaS (software as a service) industry. Unlike traditional one-time purchases, subscriptions ensure a steady, predictable revenue stream while offering customers access to the latest updates and features.

A pivotal moment in the rise of SaaS came from an economic analysis and modeling research paper, Bundling Cloud Software to Fight Piracy: An Economic Analysis. Xiong Zhang and Wei T. Yue revealed that pure bundling — selling products as part of a package — was the most effective strategy to combat piracy and maximize profits.

Pure bundling addresses two primary issues:

• The cannibalization effect: Consumers only buy what they need when individual products are available, reducing revenue.
• The competition effect: Bundling high-value products with less popular ones makes piracy less appealing since the bundle offers more utility than pirated individual tools.

Companies like Adobe and Microsoft have adopted this model. By offering their full suites as subscription bundles (for example, Adobe Creative Cloud or Microsoft Office 365), they made it more challenging to pirate individual tools and created incentives for consumers to pay for the whole package. The resulting shift in their revenue models ensured consistent profits while discouraging piracy. A win for businesses but a mixed bag for consumers.

The real cost to consumers

How isolated subscription models strain users financially

While bundling has proven effective for business, it has placed a growing financial strain on consumers. The problem lies in the cost of a single subscription and in the cumulative burden of multiple SaaS tools. For example, a small business owner might need Adobe Creative Cloud for design, QuickBooks for accounting, and Microsoft 365 for productivity. With many subscriptions for professional business software costing upwards of $50 to $100 per month, the combined cost of several platforms can reach hundreds of dollars or more, which is an unsustainable expense for many smaller businesses and freelancers.

This approach ignores the broader financial ecosystem in which consumers operate. Companies seemingly design their pricing models in isolation, assuming their service is the only one customers need. In reality, many consumers rely on multiple tools, stretching their wallets thin. As costs rise, some turn to piracy for one or more products, ironically undermining the anti-piracy intent of subscription bundles. Others, such as hobbyists, are discouraged from using these tools, stifling the creativity and innovation that could lead to new small businesses.

Adding to the frustration is the perception that corporate profits outweigh the value provided to customers. For instance, Adobe’s annual revenue for 2024 reached $21.5 billion, with top executives earning millions. While profitability is necessary for sustainability, research, and development, the stark disparity between corporate wealth and consumer affordability breeds resentment and mistrust.

The rise of subscription fatigue

When recurring costs overwhelm consumers

Subscription fatigue is an increasingly common phenomenon, where consumers feel overwhelmed by the number of recurring charges in their lives. The subscription economy has grown exponentially, from SaaS tools to streaming services, meal kits, and fitness apps. According to a recent CNET survey, the average American spends over $1,000 annually on subscription services. These costs are often higher for small businesses and freelancers relying on multiple SaaS tools.

The SaaS industry is a significant contributor to this trend. The high cost of essential software is a constant burden for small businesses and freelancers. This financial and psychological strain drives many to reevaluate their spending or turn to open source alternatives such as ComfyUI and Stable Diffusion to replace Adobe Firefly. In other cases, it can lead to pirating software they can’t afford.

Subscription fatigue isn’t only a consumer problem. It’s a business risk. As costs pile up, customers become disillusioned and view companies as exploitative rather than supportive. This erosion of trust threatens long-term brand loyalty, particularly among younger generations.

The case for collaboration in SaaS

Why companies must rethink their pricing models

The SaaS industry needs to recognize the collective financial burden on consumers. Collaboration between companies could reduce costs and improve access while maintaining profitability. For example, industry-wide subscription bundles could allow consumers to access multiple tools at discounted rates, similar to the Humble Bundle. Another solution lies in offering more flexible pricing tiers. Companies could implement “light use” plans for hobbyists or income-based pricing for small businesses with limited budgets.

However, any solution to subscription pricing models depends on the goodwill of corporations, something that history has shown to be unreliable. Large corporations prioritize profits at the expense of fairness for consumers. Without meaningful external pressure, businesses have little incentive to create equitable pricing models or simplify consumer experiences.

The Federal Trade Commission introduced the Click-to-Cancel rule in October 2024, requiring companies to make subscription cancellations as easy as signing up. This rule, spurred by lawsuits like the one against Adobe for its manipulative pricing practices, highlights the need for regulations to protect consumers. Relying on corporate self-regulation is unrealistic. True reform requires government action to hold companies accountable, enforce fairness, and ensure transparency.

Toward a fairer subscription economy

Subscription bundles have changed how we access software, offering regular updates and new features in a convenient package. However, they often prioritize corporate profits over consumer needs, creating financial strain, subscription fatigue, and limited accessibility. As the collective cost of these bundles continues to grow, the anti-piracy efforts that drove the subscription model may ironically push more consumers back to piracy.

Businesses must rethink their pricing strategies to build a fairer and more sustainable system. Relying on corporations to balance profits with consumer interests is unrealistic, making regulations essential for protecting users. Many consumers have started cutting back because they can’t justify the price, and video streaming services are often the first to go.

As costs climb, the question becomes: What subscriptions will consumers drop next? While the FTC’s one-click cancellation rule is a step forward, canceling a subscription service remains a practical way to manage expenses.