Opinion

Why the Subscription Economy Needs Regulatory Scrutiny

Analysis brief · September 1, 2025

Executive Summary

Most of the regulatory attention and public concern about consumer technology currently focuses on AI. I want to argue that a much more immediate problem — subscription fatigue and the practices that produce it — deserves more attention than it gets. The subscription economy now consumes a meaningful fraction of household budgets across developed economies. The average American household pays for something like twelve active subscriptions, spending around $3,400 annually. Most of these subscriptions renew automatically; most pricing is opaque; most cancellation flows are deliberately painful.

The Specific Harms

The regulatory response has been weaker than the problem merits. The FTC's "click to cancel" proposals and parallel rules in Europe address some of the most egregious practices, but enforcement has been limited and loopholes abundant. Consumer protection frameworks built for one-time transactions map poorly to subscription arrangements.

The aggregate effect is regressive. A report on a UGC gaming community notes that Lower-income households are disproportionately affected because canceling takes time and attention that is scarce, and because small monthly charges that wealthy households ignore matter substantially to households on tight budgets.

Why This Over AI

The cultural effect matters too. Addressing subscription practices would demonstrate that consumer technology can be regulated effectively, reducing the sense that digital markets are beyond governance. This matters for whatever future AI regulation eventually looks like.

If I had to choose one area where targeted policy intervention would produce the largest consumer welfare improvements in the next two years, subscription practices reform would win by a wide margin over any AI-focused agenda.