Ford made a bad rehire

[Yellow Buddy]

ARR (Annual Recurring Revenue) is the big hype in most industries these days. It allows companies to better plan financial performance and operating plans.

That’s what everyone pitches, but is anyone truly successful with it when it comes to feature/content subscription? (Honest question, not rhetorical)

I feel like companies like Netflix, Hulu, Spotify, haven’t been particularly profitable - if at all. They’ve had valuation increases, steady revenue/cash flow, but they don’t actually make anything. It feels like it costs them more to keep you on the hook than they make from actually having you on the hook.

It seems more like the ecosystem companies are the ones that do actually make something, but it’s more because they’re leveraging the ecosystem and not necessarily due to the subscription.

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[H3IMDALL]

That’s what everyone pitches, but is anyone truly successful with it when it comes to feature/content subscription? (Honest question, not rhetorical)

I feel like companies like Netflix, Hulu, Spotify, haven’t been particularly profitable - if at all. They’ve had valuation increases, steady revenue/cash flow, but they don’t actually make anything. It feels like it costs them more to keep you on the hook than they make from actually having you on the hook.

Netflix made 4.4 billion last year. Hulu/Espn+ are losing tons of money and Spotify has lost money every year it’s been in existence. XBox game pass is profitable, iTunes makes money. Pay to Win games make a sh**load of money for little additions that let you buy your way to winning. Cable is essentially that model. So that feeling is wrong, but is there probably because we (consumers) hate that model when its used for real things we want to own (vs music/video). Like John Deer making it impossible to work on your tractor by locking you out of the software (to force you to go to the dealer) until recently.

 

[MRButtler]

"I want to count wiper strokes".

 

[astricklin]

Most B2B Saas companies make the bulk of their money off arr.
Something around 75% of Amazon operating profit is from AWS, which is mostly ARR.
For Ford, I don't see most of the ARR that they are talking about coming from consumers unless they really build a large service similar to OnStar. It seems that Ford is really targeting their fleet management services, they are calling Ford Pro. This is where they can make a lot of money on software subscriptions. If they can provide fleet management tools that are valuable to a business and can save time and money, then they will most likely be able to count on multi-year contracts with those customers.

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