The numbers

According to Zuora's Subscription Economy Index, the global subscription economy reached $1.5 trillion in annual recurring revenue in 2025 — a number that would have seemed implausible 10 years ago. Subscription-based companies have grown 3.7x faster than the S&P 500 over the past decade.

The model has expanded well beyond its early digital beachheads. Software subscriptions were the first wave. Then media streaming. Now the subscription model has colonized physical goods (meal kits, razors, vitamins), services (car maintenance, pet care, cleaning), and even software-adjacent categories like AI tools and productivity suites.

The cracks

But 2025 also marked a turning point. Several signals suggest the easy growth phase of the subscription economy is over:

Churn rates are rising. Zuora's data shows average subscription churn across sectors increased from 5.2% to 6.8% annually between 2023 and 2025. Consumers are actively auditing their subscriptions in ways they weren't 3 years ago.

Subscription fatigue is a named phenomenon. The term "subscription fatigue" now appears in mainstream financial media, not just industry publications. Consumer awareness of the aggregate cost of their subscriptions has meaningfully increased, partly driven by inflation pressures and partly by the proliferation of subscription management tools.

Regulatory scrutiny is increasing. The FTC's "click to cancel" rule (finalized in 2024) requires subscription companies to make cancellation as easy as sign-up. The EU's Digital Services Act has similar provisions. These regulations structurally reduce the save rate advantage that made many subscription businesses defensively moated.

The bifurcation

What we're seeing is a bifurcation of the market. Subscriptions with genuine, irreplaceable value — cloud services, business software, health platforms — are growing and retaining customers. Subscriptions that relied on friction and forgetting to sustain their churn economics are struggling.

This is actually healthy for consumers. The subscription model at its best is a genuine value exchange: you pay regularly, you get ongoing value regularly. When that exchange is fair and transparent, subscription businesses thrive. When it depends on customers forgetting they're paying, the model eventually fails.

What this means for you

The subscription economy isn't going away. But it's maturing. The services that survive will be the ones that earn their renewals. As a consumer, your job is to make sure you're only renewing the ones that have earned it.

That means knowing what you're paying for, how much, and when. It means reviewing your subscriptions at least quarterly. And it means having tools that make that review effortless rather than a forensic accounting exercise.

Zuora

The Subscription Economy in 2026: $1.5 Trillion and Growing (But Cracks Are Showing)