Dictionary of all accounting terms
A subscription is a signed agreement between a supplier and customer that the customer will receive and provide payment for regular products or services, usually for a one-year period.
A subscription is a relatively new business model by which a customer agrees to pay the company for products or services throughout a specified time-period. For example, the customer may agree to purchase a one-year subscription to a magazine which he receives on a regular basis (monthly, weekly, etc.). The customer may pay the entire sum upfront, or he will pay on a monthly basis. The payment is usually applied automatically, and therefore the customer will need a credit or debit card and agree to be charged.
The subscription model can be applied for various businesses, including: