Five on Friday: Leasing Programs, Premium Podcasts and Bitcoin Payments

In this week’s Five on Friday, automobile subscription startup Fair abandons the subscription model and vehicle leasing program to go to a more traditional marketplace model, and OnlyFans waffles on its decision to ban sexually explicit content from its site. Also this week, Spotify rolls out a premium podcast subscription service to all U.S. creators, Substack allows Bitcoin lightning payments and Amazon warns sellers that Congress is pushing back on antitrust concerns.

Fair Ends Subscription Model and Vehicle Lease Program

Auto-subscription startup Fair is moving away from its subscription model and vehicle lease program and transforming the company into a more traditional, market-based model, reports Community 99. After fueling expansion in 2019 with the acquisition of Ford’s Canvas vehicle subscription program, the company soon laid off 40% of its staff. At the time, the company said they were focusing on technology and cutting costs.

Two years later, and the company has taken on $315 million in senior secured debt to Softbank along with unsecured debt. At the same time, demand for used vehicle subscriptions and leased vehicles have been limited.

Instead, Fair will use its digital platform to facilitate the sale of cars, including finance, insurance and the associated paperwork. The company would partner with dealers for the hands-on work like test drives, trade-ins, vehicle delivery and service. Consumers would conduct their transactions through the Fair app and interact with dealers on a wholesale basis as needed.

On the company’s website, Fair says, “A new Fair is on the way. We’re building a new digital car-shopping experience that’s bigger and better than anything you’ve seen before.”

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Though Fair’s business model was different than individual auto manufacturers who started their own car subscriptions, vehicle subscription services have not yet found a successful niche. Many manufacturers have tried and failed to make a successful go of a subscription service, while others have tweaked and remodeled theirs. It remains to be see if car subscriptions are a thing of the past or the future, but we have not seen a winning formula yet.

Previously, Fair offered used car subscriptions and leased vehicles through the Fair app. The company is moving to a market-based model as it attempts to get out from under $315 million in secured debt. Image courtesy of Fair.

OnlyFans Changed Its Plans to Ban Porn from Site After Creator Backlash

Last week, London-based social media platform OnlyFans – which is known for sexually explicit content – said it would ban not-safe-for-work content from the site effective October 1, said The New York Times. The company’s reasoning was that its banking partners and payment providers asked OnlyFans to block users who posted sexually explicit photos and videos. Content that complied with its standards, which include some nudity, would still be allowed.

No content featuring sexual assault, violence or minors would be allowed. One of the key concerns is that the creator platform could not find investors because of the content offered on the site, according to Axios. The Times said that the platform has more than 130 million users who pay monthly subscriptions fees and optional tips for the explicit content.

After backlash from creators, OnlyFans has now reversed course, saying it will allow sexually explicit content after all. The company changed its position because it received assurances from its banking partners that creators would continue to receive their support. OnlyFans made the announcement on Twitter on Wednesday.

Image courtesy of Twitter

The company said they would reach out to creators directly. The damage seems to have been done already. Some creators took to Twitter to tell OnlyFans that they no longer trusted the platform, that the platform’s 20% revenue share was too high, and the company lacked empathy. Others said they had already lost subscribers when the announcement that sexually explicit content would be banned was made.

[Editor’s note: Because many of the comments contained explicit language, and we don’t have the opportunity to talk directly with OnlyFans, we’ve opted not to share the comments. They can be viewed on Twitter under the OnlyFans account.]

Spotify’s Premium Podcast Subscription Service Now Available to All U.S. Creators

After testing a premium podcast subscription service since April, Spotify has officially rolled out the service to all U.S.-based creators. Using the company’s podcast creator platform Anchor, podcast publishers and creators can offer shows across a variety of genres and content styles while monetizing their work. During testing, more than 100 podcasts and shows were launched, and Spotify is expanding the availability of the platform to all U.S. creators.

Spotify is investing in podcast-related acquisitions.

“We have long believed that creators should have a variety of options at their fingertips when it comes to deciding how to monetize their work. That’s why, as more creators than ever are now publishing their content on Spotify, we’ve begun rolling out tools that power those choices: from better advertising models to direct monetization from listeners,” said Spotify in an August 24, 2021 blog post.

Using Anchor, creators can select which episodes are subscriber-only content to maximize their revenue. Spotify said that podcasts will not take a commission on any subscriptions until 2023, but they will charge payment processing fees. Starting in 2023, Spotify will take a 5% commission of subscription revenue.

Since the initial test, Spotify has made some adjustments which they believe will benefit podcasters and their listeners. Two major changes include the following:

  • Creators can choose from 20 different price points to give them flexibility.
  • Creators can download a list of contact information for their subscribers, so they can communicate with them directly.

“Podcast Subscriptions will continue to evolve and grow as we learn from creators who succeed with this model. We plan to expand internationally very soon: Starting on September 15, international listeners will gain access to subscriber-only content, and shortly after we’ll make the feature available to creators around the world—so stay tuned,” said Spotify.

Substack Partners with OpenNode to Accept Bitcoin on Platform

On Monday, newsletter platform Substack announced that it has partnered with OpenNode, a leading Bitcoin payment processor, to accept Bitcoin payments on the paid publishing platform. Substack, which boasts 500,000 paying subscribers, can now allow readers to use Bitcoin to pay for writers with participating subscription newsletters.

“We’re excited to be working with OpenNode to enable independent publishers on Substack to accept crypto payments,” said Nick Inzucchi, product designer at Substack, in an August 23 news release. “Having this option will give writers more flexibility and freedom, and we look forward to doing more in crypto to meet writers’ needs.”

João Almeida, co-founder and CTO at OpenNode, also commented on the new relationship.

“Our partnership will allow content creators across the Substack ecosystem to accept Bitcoin payments, and retain earnings in Bitcoin or convert to preferred currency. Writers and podcasters have flocked to Substack to regain creative and financial freedom, and Bitcoin is a natural fit,” said Almeida.

Substack is partnering with the Bitcoin payments platform OpenNode to make it easy for writers and publications to get paid in Bitcoin. Image courtesy of Substack and OpenNode.

Amazon Warns Third-Party Sellers About Congress’s Proposed Antitrust Legislation

Amazon and their ecommerce dominance have been on the federal government’s radar for years. But that isn’t the only development in the antitrust space. Congress is considering legislation that could harm Amazon’s business and the business of its third-party sellers. To forewarn them, Amazon sent a letter to third-party sellers letting them know about potential antitrust legislation that could affect them, says PYMNTS.com. Amazon has also been reaching out to some of their sellers to let them know about possible impacts.

“We’re reaching out to a small group of our sellers to make them aware of a package of legislative proposals, currently in Congress, that is aimed at regulating Amazon and other large technology companies,” an email viewed by CNBC stated. “It is early in the process and the bills are subject to change, but we are concerned that they could potentially have significant negative effects on small and medium-sized businesses like yours that sell in our store.”

According to CNBC, the Amazon email encourages merchants to contact their policy team to discuss the potential legislative which was approved in June by the House Judiciary Committee. The legislative has the ability to overhaul current U.S. antitrust laws and put a target on the backs of big tech companies like Amazon. When this package of legislation was introduced by the House in June, Amazon’s Brian Huseman, vice president of public policy, issued a statement:

“We are still analyzing the bills, but from what we can tell so far, we believe they would have significant negative effects on the hundreds of thousands of American small- and medium-sized businesses that sell in our store, and tens of millions of consumers who buy products from Amazon. More than a half million American small- and medium-sized businesses make a living via Amazon’s marketplace, and without access to Amazon’s customers, it will be much harder for these third-party sellers to create awareness for their business and earn a comparable income. Removing the selection of these sellers from Amazon’s store would also create less price competition for products, and likely end up increasing prices for consumers. The Committee is moving unnecessarily fast in pushing these bills forward. We encourage Chairman Cicilline and committee members to slow down, postpone the markup, and thoroughly vet the language in the bills for unintended negative consequences.”

With millions of merchants on the Amazon platform, the company will need all the support it can get to fight Congress on what looks like game-changing legislation.