The post-SaaS business model: what comes after the subscription

Every business model is an answer to a constraint. SaaS answered two: distributing software was hard (it had to be installed) and building it was extremely expensive (the investment had to be recouped). The subscription solved both: the cloud removes installation, and recurring payment funds development.

Both constraints died. Distributing is opening a URL. Building costs a fraction of what it used to. And yet the subscription stayed, like a habit without a cause.

What replaces it? These are the four models we see emerging.

1. Open source + infrastructure at cost

The software is free and open; you only pay to run it, with no margin. This is Zerosoftware's model. Its virtue is radical honesty: the price is verifiable against AWS bills. Its flaw, for investors: there's no margin to scale. Exactly. That's not an accident — it's the point.

2. Open source + real services

Red Hat proved this decades ago: the software is free, and you charge for what humans do — support, consulting, guarantees, certifications. It works because it charges for real work, not for copying bits. The difference from SaaS: if you stop paying, you lose the service, not the software.

3. Pure usage-based

Pay exactly for what you use: requests, compute minutes, GB stored. Stripe and cloud providers live on this. It's honest as long as the metric reflects real cost; it gets corrupted when the "unit of usage" is invented to maximize billing (see: seats, "marketing contacts", artificial API limits).

4. Perpetual purchase (the return)

With development costs collapsing, selling software once again becomes viable, like before: $X, yours, with a year of updates. Several indies already live this way. It doesn't scale to trillion-dollar valuations — and that's exactly why it benefits users.

What they all have in common

None of them can charge for copying bits. That's the thread: when marginal cost is zero, any price above zero needs justification, and "because it's always been this way" stopped being one.

SaaS won't disappear overnight. It will shrink to what it always should have been: a hosting service with free software on top. We just gave it a name, a price, and zeros.

Software is dead. These are the heirs.