The Subscription Economy in Decline – Why Everyone Is Unsubscribing

In recent years, subscription services have woven themselves into every aspect of our lives – from our TV screens and music playlists to our offices and daily routines. But after a prolonged boom, the subscription-based model is hitting some turbulence. A new survey by GISKAA finds that worldwide, people are unsubscribing – cutting back on streaming services, software tools, and more – at rates we haven’t seen in over a decade. What’s going on with the subscription economy, and why are so many consumers and companies hitting the “cancel” button?

Consumers Hit “Subscription Fatigue”

If you feel like you have too many subscriptions and not enough paycheck to cover them all, you’re not alone. The average American today pays for around a dozen monthly subscriptions – from Netflix to gym apps – and it’s become overwhelming. This sense of overload is known as “subscription fatigue,” and it’s driving a wave of cancellations.

According to our survey and supporting research, over 60% of streaming TV consumers now report subscription fatigue. In fact, one-third of streaming subscribers canceled at least one service in the past year, up from one-quarter who did so in 2020. This marks a significant shift: after years of adding more and more streaming platforms, viewers are now pruning their subscriptions. The trend isn’t limited to video streaming – similar patterns are seen in music streaming, news subscriptions, and even subscription boxes for beauty or food.

Why are people unsubscribing? Cost is a major factor. Many streaming giants implemented notable price hikes last year (nearly 25% on average in 2023), and consumers have taken notice. Nearly 90% of consumers say their income hasn’t kept up with these price increases, prompting tough choices about which services to keep. In a global survey, two out of five people who canceled a streaming service said they did it to save money, and a further 26% canceled because they simply had “too many” subscriptions. This implies that many households are consciously capping the number of services they’ll pay for at once. In fact, 62% of respondents said if they were to sign up for a new streaming platform, they’d cancel an existing subscription or cut spending elsewhere to afford it. The era of endlessly stacking subscriptions appears to be over.

Another reason is lack of use – people are realizing they’re paying for services they barely use. Over 85% of subscribers admit they have at least one paid subscription that they haven’t used in the past month. These “sleeping subscriptions” often continue due to autopay and forgetfulness. But with new consumer protection rules (like the U.S. FTC’s upcoming “click-to-cancel” regulation) making it easier to cancel recurring charges, those dormant subscriptions are now at risk. Savvier consumers are regularly cycling through services – for example, nearly half of streaming users say they sign up to watch a specific show, then cancel or pause until there’s something else they want to see. This on-off behavior has led to much higher churn. Industry data shows overall subscription churn rates have tripled in the past four years, a clear sign that loyalty is harder to maintain in the subscription economy.

Finally, the broader economic climate is pouring cold water on subscription spending. High inflation and mounting household debt are forcing consumers to prioritize necessities over nice-to-haves. Inflation has raised the cost of food, fuel, and housing – and subscriptions are an easy target for belt-tightening. “Anytime there is high inflation, there is an impact on discretionary spending… most subscriptions are discretionary,” explains Michael Mallon, an expert at a fraud prevention firm. In the United States, credit card debt has surged to record levels (over $1.1 trillion), and more people are hitting their credit limits. It’s no surprise many are combing through their monthly credit card statements for subscriptions to cancel. We’re seeing this effect in everything from streaming cancellations to fewer subscribers for meal-kit deliveries and online clubs.

The result? A consumer-led correction in the subscription landscape. People are keeping the services they love most, but dropping the rest. Streaming is a prime example: nearly 100% of U.S. households have at least one paid streaming service, but the total number of services per person is shrinking. Globally, the average number of streaming subscriptions per consumer fell by 14% this year, according to a Simon-Kucher study. And consumers are spending less time on streaming too – the share of people who said they’re streaming “more” than before has dropped in many countries, indicating saturation. In short, the subscription boom of the last decade is cooling off as consumers seek a sustainable balance.

Businesses Tighten Up on SaaS Subscriptions

It’s not just entertainment and consumer services feeling the pinch. Businesses are also reassessing their subscriptions, particularly in the SaaS (Software-as-a-Service) domain. Over the past 10+ years, companies eagerly adopted cloud-based software for every function, leading to “app sprawl.” But in 2023, that trend reversed for the first time.

A landmark study by BetterCloud found that the average number of SaaS applications used per company dropped from 130 in 2022 to 112 in 2023 – a 14% decline. This indicates that many organizations are consolidating and cutting out redundant or underutilized software tools. Our own GISKAA survey of IT managers echoed this: facing tighter budgets, IT departments spent 2023 “in consolidation mode,” auditing software licenses and eliminating excess. After years of “there’s an app for that” exuberance, companies have realized they were paying for too many overlapping tools (often with many seats going unused). In fact, companies report wasting on average over $135,000 per year on unused software licenses, which has become an obvious target for cost reduction. 

Several forces are driving this SaaS subscription belt-tightening. First, the economic backdrop: higher interest rates and recession concerns in 2023 led CEOs and CFOs to scrutinize expenses – and SaaS subscriptions (which often auto-renew annually) were ripe for trimming. Enterprise software sales slowed markedly. SaaS businesses did grow in 2023, but at a much slower rate than the hypergrowth years prior, and revenue growth rates for many fell to single digits. At the same time, customer churn hit an all-time high in the B2B software sector, as clients downgraded or canceled subscriptions to cut costs. In other words, the boom times for cloud software cooled off, and the focus shifted to retaining existing customers rather than aggressive expansion. 

Another factor is the tech industry’s shift in priorities. We’re now in the age of Generative AI, and businesses are directing resources to AI projects – sometimes at the expense of other software. “If IT groups are putting big spend into generative AI and there’s a fixed IT budget, then they’ve got to pull from something. Sometimes it’s SaaS licensing,” observes Patrick Moorhead, a tech analyst. Companies might delay purchasing yet another SaaS tool if they’re investing in AI infrastructure or large language model integrations. Additionally, workforce reductions (layoffs in tech and other sectors over the past year) mean fewer employees needing software seats, reducing subscription counts for per-user licensed software. For instance, a company that downsized from 500 to 400 employees will naturally cut 100 SaaS licenses for tools like email, CRM, or project management. 

It’s worth noting that this cooling off in SaaS is viewed by many experts as a healthy normalization after the pandemic-driven boom. During 2020–2021, companies adopted cloud software at an unprecedented pace (to support remote work and digital customer engagement), which “pulled forward” a lot of demand. Now that the market is maturing, the growth curve for SaaS is flattening. Investors and vendors are adjusting to a new normal where growth rates are more modest. However, the long-term outlook for SaaS remains positive – nearly all analysts agree that more and more business operations will be software-driven and cloud-delivered. In fact, the recent slowdown is prompting SaaS providers to improve their value propositions, focus on customer success (to prevent churn), and incorporate AI features to make their products indispensable again. As Moorhead notes, while AI is a short-term headwind for SaaS budgets, it’s likely a long-term tailwind, because software companies will be able to charge more for new AI-powered capabilities down the line.

Not All Doom and Gloom: Subscriptions That Are Thriving

Despite the overall dip in subscription growth, it’s not a uniform decline – some subscription services are growing explosively even as others wane. The key is providing unique, must-have value that customers are willing to pay for, even in tough times. A prime example is the rise of AI-powered services and certain digital tools.

ChatGPT, the AI chatbot developed by OpenAI, is a standout case. Launched in late 2022, ChatGPT’s basic service is free, but in February 2023 OpenAI introduced ChatGPT Plus, a premium subscription for $20/month with enhanced features. The response was tremendous: by early 2025, ChatGPT Plus garnered roughly 10 million paying subscribers globally, and the number continues to climb. In total, ChatGPT’s user base (free and paid) reached an estimated 400 million weekly active users worldwide by 2025, making it one of the fastest-adopted technologies in history. This growth happened even as many other consumer apps struggled to gain users. It shows that when a service offers something genuinely novel and valuable – in ChatGPT’s case, instant AI assistance for anything from writing code to brainstorming ideas – consumers will open their wallets. In fact, ChatGPT has become so dominant that it reportedly accounts for over 60% of the market share among AI tool subscriptions.

Other areas seeing subscription growth include certain productivity and creative tools (for example, design platforms like Canva or developer toolkits) that became essential for remote/hybrid workers, and niche content platforms that have very loyal fanbases (such as specialized streaming services, Patreon memberships for creators, etc.). Additionally, many traditional subscription businesses are pivoting to new models to retain subscribers – like offering cheaper ad-supported tiers (Disney+, Netflix, and others have introduced lower-cost plans with ads, which have attracted cost-conscious users). This has led to an interesting twist: while premium ad-free subscription growth is slowing, ad-supported subscription plans are on the rise, outpacing their ad-free counterparts as people trade down to save money. In 2023, a significant chunk of subscribers downgraded to ad-supported plans (40% of those looking to cut costs did so), rather than cancel outright. This indicates consumers still want the service, just at a price point they can better afford.

Bundling is another strategy showing promise. Companies like Amazon (with Prime) or Apple (with Apple One) bundle multiple services under one subscription, delivering more value for the price. Consumers appear more willing to keep a bundle that serves multiple needs, rather than paying for many single-purpose subscriptions. This bundling trend might counteract some of the subscription fatigue by simplifying the consumer’s lineup of services.

The Road Ahead: Adapting to the New Subscription Landscape

The evidence is clear: the subscription model isn’t going away, but it is evolving in response to consumer pushback and economic reality. We are likely moving into a phase where quality, flexibility, and value for money decide which subscriptions thrive and which get canceled.

For companies offering subscription services, the mandate is to focus on customer retention and satisfaction like never before. Gone are the days of easy growth through endless customer acquisition – now it’s about reducing churn and proving your service is worth a permanent spot in the customer’s budget. Some strategies that experts recommend include:

• Offering Flexible Plans: Allow pausing or easy cancellation, family/shared plans, and tiered pricing (including free or cheaper ad-based tiers). This can capture both high-end users and price-sensitive users, reducing th all-or-nothing cancellation risk.
• Demonstrating Clear Value: Continuously communicate and deliver value. If users don’t regularly use or see the benefit of the service, they’ll cancel. Subscription businesses should invest in onboarding, education, and new features (especially leveraging AI or personalized content) to keep engagement high.
• Combating Subscription Fatigue: Simplify the customer experience. Aggregation and bundles can help – for example, telecom providers bundling streaming services, or software suites offering an all-in-one platform. The more convenience and integration, the less likely users will feel the urge to trim it.
• Customer-Friendly Practices: Embrace the spirit of forthcoming regulations by making cancellations straightforward and respecting customers’ choices. Ironically, being easy to cancel might earn goodwill that keeps subscribers around (because they don’t feel “trapped”). On the flip side, relying on trickery to prevent cancellations will only breed resentment and hasten churn in the long run.

From the consumer perspective, this “subscription reset” is ultimately empowering. It means companies are likely to compete harder for your subscription dollars – through better content, lower prices, or innovative features. We’re already seeing streaming services rethink their release strategies and pricing, and software companies adding more into their packages (like free upgrades or bundled services) to justify the cost.

In summary, while there’s a clear decline in subscription uptake and an increase in cancellations worldwide, it’s not the end of subscriptions – it’s a market correction. The subscription model remains powerful, but it’s maturing. Consumers are smarter about what they sign up for and for how long, and businesses must respond accordingly. As our GISKAA survey highlights, value, flexibility, and trust are becoming the pillars of successful subscriptions in this new era. Those subscription services that embrace these principles may not only survive the current downturn but come out stronger with a more loyal, engaged subscriber base.

After years of rapid expansion, businesses trimmed their software subscriptions in 2023. The average number of SaaS applications per company fell from 130 to 112 – the first such decline in over a decade. Tight budgets and overlapping tools led IT departments to consolidate software resources.

Not all subscriptions are suffering – AI services are a notable exception. ChatGPT, the AI chatbot, saw user growth skyrocket from 100 million weekly users in late 2023 to 400 million by early 2025, with its paid ChatGPT Plus tier surpassing 10 million subscribers. This suggests consumers will pay for disruptive, high-value services even amid subscription fatigue.

In the coming months and years, keep an eye on how subscription providers adjust their strategies – and expect new hybrids of subscriptions with usage-based elements, more generous free tiers, or loyalty rewards aimed at keeping you subscribed. The subscription economy isn’t crashing; it’s cutting the excess weight and re-focusing on sustainable growth. For consumers, it’s a good time to assess your own subscriptions: figure out which ones spark joy (or productivity) and ditch the rest – at least until a better offer comes along. After all, in the world of subscriptions, the power to subscribe and unsubscribe is ultimately in your hands.