Decumulate t1_ja37ch8 wrote

Well then I’m confused and the model seems very broken. If you are selling a product under its “value” with the idea that users will keep paying additional (on goodwill) after some period of time, you’ll find that users will just resell these products at high prices and buy another product at the “under valued” price. This will cause supply and demand issues, and the undervalued price will just shoot up to the original price anyways.

If you’re saying they will never actually own the product and the subscription will go on for perpetuity, then this is just a simple rental model with requirement of an upfront payment. It’s viable but I’m not sure it does much to solve the obsolescence issue as phones have been following this model for many years and it seemed to do nothing to stop people from upgrading. In fact, before most carriers shifted more to “rent to own” models, people anxiously waited to upgrade after 2 years, meaning your model might actually be making the obsolescence problem worse.

A more efficient way to solve the problem of obsolesce is to make trash and disposal very expensive such that people are cautious about what they purchase. This would also reduce trash intake and profitability from trash to a point where we could implement a very high expectation of recycling with all trash. Consumers will buy things that last longer across the board, and manufacturers will design for longevity.


Decumulate t1_ja34ndm wrote

Idea one is basically just a “rent to own” type model. The net cost would need to be much more expensive than the cost without using the paying given the amount of additional cost added by the model (more people replacing, more staff, more complicated distribution model).

So if you think someone would pay $300 for a backpack that fits the rent to own model versus $200 without, then perhaps it’s not a horrible idea.

Note that this isn’t much different from a standard warranty service that you can add to most purchases.