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Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

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Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#61

Post by candiddevmike »

paxys wrote: post #44
candiddevmike wrote: post #35

In my opinion, no one should be using recurring billing for any provider. If you do, you've basically tied yourselves to them--if you ever decide to move, you need to somehow get the subscription details for every customer migrated into your app! Instead, view your payment processor as just another PaymentProcessor enum. Own the recurring subscriptions yourself, or be willing to pay for someone to do it for you.

That is easier said than done. Managing recurring billing is a significant engineering problem, and getting tied in with a provider and paying a surcharge is still worth it over maintaining an entire in-house dev team to do it.

In my experience, it should be no more difficult than sending recurring emails. You should have all the data (PaymentProcessorCustomerID, LastBillingDate, etc), run it like you would a email with a retry queue.

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#62

Post by loceng »

smabie wrote: post #52
loceng wrote: post #38

Earlier quoted context omitted.

The economies of scale that Stripe is now benefitting from doesn't make your reasoning sit with me very well.

How about: they're increasing the price to X because that's what they want to charge. They think price X will help maximize the long-term value of the company.

Sure, they can say that and be honest instead of trying to marinate us with these gymnastics; it's insulting too that they believe we can be manipulated like this.

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#63

Post by lukevdp »

unethical_ban wrote: post #42

The idea that the ongoing cost of moving money between parties varies on the amount of money moving is very "sus" as they say. Whether they move $10,000 in a transaction or $3, roughly the same number of bits move, the same number of algorithms kick off, and so on. Is there a cost-based rationale for doing a percentage-based pricing model, or is it really "because they can"? I could brainstorm and say "fraud" or "def…

> Is there a cost-based rationale for doing a percentage-based pricing model, or is it really "because they can"?

It’s definitely because they can.

There is no rule that pricing must be cost based.

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#65

Post by abfan1127 »

paxys wrote: post #44
candiddevmike wrote: post #35

In my opinion, no one should be using recurring billing for any provider. If you do, you've basically tied yourselves to them--if you ever decide to move, you need to somehow get the subscription details for every customer migrated into your app! Instead, view your payment processor as just another PaymentProcessor enum. Own the recurring subscriptions yourself, or be willing to pay for someone to do it for you.

That is easier said than done. Managing recurring billing is a significant engineering problem, and getting tied in with a provider and paying a surcharge is still worth it over maintaining an entire in-house dev team to do it.

> Managing recurring billing is a significant engineering problem

This is a huge understatement! Its very painful. It sounds easy, but there are so many end cases with the calendar alone! Let along discounts, prorating, cancelations, etc.

It sucks to become dependent on providers for this service, but it also sucks to have crappy recurring billing.

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#66

Post by onassar »

tebbers wrote: post #54
onassar wrote: post #36

Earlier quoted context omitted.

Thanks for jumping in here so quick. I'm sure it'll be a tough thread, but something about this response rubs me the wrong way. It doesn't seem like it's really addressing the change (eg. why is it worth _existing_ customers to be paying an extra 0.5%? The fact that Stripe added features for new customers doesn't really impact those of us who have been with you for 5-10 years). Additionally, I don't recall getting an…

I don't think this is a pricing increase? It's just their pricing for Stripe Billing. It's been 0.5% since at least 2018 which is when I started using it. I'm not sure why this has suddenly exploded on HN.

I think it's because Stripe has for a long time branded themselves as being priced simply. Reading that there is a price increase, I think, warrants a noticeable reaction, since it could mean a new 0.5% cost for every business relying on them.

That can be a lot of money for some people, and in general, I'm a bit disappointed that I found out about the Billing product increase through HN. I would have expected to get an email from Stripe, maybe a month ago, saying "Hey: our rates are going up on 12 November"

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#67

Post by Gaelan »

tebbers wrote: post #54
onassar wrote: post #36

Earlier quoted context omitted.

Thanks for jumping in here so quick. I'm sure it'll be a tough thread, but something about this response rubs me the wrong way. It doesn't seem like it's really addressing the change (eg. why is it worth _existing_ customers to be paying an extra 0.5%? The fact that Stripe added features for new customers doesn't really impact those of us who have been with you for 5-10 years). Additionally, I don't recall getting an…

I don't think this is a pricing increase? It's just their pricing for Stripe Billing. It's been 0.5% since at least 2018 which is when I started using it. I'm not sure why this has suddenly exploded on HN.

IIRC, Stripe used to have a "subscriptions" API at no extra cost. A few years ago, when they launched Billing (with the 0.5% fee), they moved everyone over to that but grandfathered in the old pricing. Now they're making everyone pay for it.

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#68

Post by byteofbits »

lukevdp wrote: post #47
grumple wrote: post #18

Earlier quoted context omitted.

Why are you hostage to it? How much dev time would switching to a different transaction processor take? This seems like it should be a very competitive space.

It’s not just dev time, that would be easy. It’s getting every customer to re-enter their credit card details which won’t happen without a significant uptick in arrears, and depending on the type of customer, churn.

Stripe supports exporting PCI data like credit card details to other PCI Level 1[1] providers such as Recurly and Braintree.

Data portability is a solved problem in this space - so there isn't a material risk of churn due to a migration like this.

We recently went through the process and it was very easy.

[1] - https://stripe.com/docs/security/data-migrations/exports

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#69

Post by arghwhat »

troughway wrote: post #56
polote wrote: post #51

Earlier quoted context omitted.

> Unfortunately, we're kind of hostage to it. The day you decided to go with Stripe you started being hostage of them, but this is not a bad thing, this is business, you choose a partner, they are allowed to change the terms if the contract permit it. People on HN always think they deserve to be treated better than others

>People on HN always think they deserve to be treated better than others Y..you mean we won't all be millionaires when we grow up?

No no, we will all be millionaires. Just not you specifically. Sorry.

Re: Stripe migrates Stripe Subscriptions users to more expensive Stripe Billing

#70

Post by PaybackTony »

unethical_ban wrote: post #42

The idea that the ongoing cost of moving money between parties varies on the amount of money moving is very "sus" as they say. Whether they move $10,000 in a transaction or $3, roughly the same number of bits move, the same number of algorithms kick off, and so on. Is there a cost-based rationale for doing a percentage-based pricing model, or is it really "because they can"? I could brainstorm and say "fraud" or "def…

Much of the interchange rate is charged directly by Visa / Mastercard. The merchant bank will then add basis points to that, and often you get another mark-up by the individual ISO (independent sales organization) in a typical set up. So, then, why do card processors charge percentage? Well, when you see those Capital One commercials where you get 1% cashback on this type of purchase or 2% cashback on this, that's where the money is coming from.

Companies like Stripe shield you from the intricacies of interchange pricing but if you operate on interchange + (meaning, the merchant account provider is charging you interchange + X %), you see that processing corporate rewards cards are the biggest killers, because you are essentially covering their 2% cashback programs. Additionally, some of that cost is insurance. If you have a fraudulent charge on your card processors work with your banks to cover some of that money, which they make from the overall % of total volume.

Not saying any of that is right, or an ideal situation, that's just the why.

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