A lot of software business models may have been overly influenced by interest rates the last few years.
At a low interest rate, the time value of capital is low - a company can defer revenue almost indefinitely with minimal cost. Hence, a subscription business like SalesForce can spend handsomely on onboarding, and expect to make money back over the course of 5-10 years. To a certain extent, the same applies to ad supported business models.
If interest rates are higher, then a lump sum upfront payment may be a better bet. This may effect how software is written as well as how it is purchased.
Or we'll just see a steady increase in subscription costs.
At a low interest rate, the time value of capital is low - a company can defer revenue almost indefinitely with minimal cost. Hence, a subscription business like SalesForce can spend handsomely on onboarding, and expect to make money back over the course of 5-10 years. To a certain extent, the same applies to ad supported business models.
If interest rates are higher, then a lump sum upfront payment may be a better bet. This may effect how software is written as well as how it is purchased.
Or we'll just see a steady increase in subscription costs.