How a per-subscriber fee works
The vendor counts your active paying subscribers at the end of each month and multiplies by the fee. Fees of around $0.50 to $1 per subscriber are common. Some vendors include a number of subscribers in the base plan and charge only above it.
What it costs as you grow
The fee looks small against a single subscription and large in total. At $1 per subscriber, 1,000 subscribers costs $1,000 a month, 5,000 costs $5,000 and 20,000 costs $20,000, whatever those subscribers pay you.
It also weighs most on low-priced plans. A $1 fee is 10% of a $10 plan but a third of a $3 plan, which makes localized pricing in lower-income markets hard to sustain.
Per-subscriber fee vs flat pricing
To compare vendors, work out the total monthly cost at the subscriber count you expect in a year, including delivery, apps and any cut of one-time sales, not the cost on day one.
- Per-subscriber: low cost at launch, rising without limit as you grow
- Flat tier: a fixed monthly price that includes a set number of active users
- Usage-based: you pay for what is delivered, such as CDN traffic and storage
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