Ownership is an Outdated Concept in a Circular Economy

The traditional concept of ownership is undergoing a radical transformation. Both in our private lives and across the business landscape, we are shifting from a possession-based society to a service economy. The value of a product now lies not in owning it, but in the utility and experience it provides.

The service economy is a structural redefinition of value and success. Owning iconic objects like cars is no longer the primary status symbol it once was. Modern citizens prioritize access and experience over the burden of maintenance and depreciation. Faced with fluctuating purchasing power, consumers prefer smoothed subscription payments that offer high-quality, personalized experiences without a massive upfront capital investment. This transition, termed dispropriation, is not a forced seizure of assets (expropriation). Rather, it is a voluntary abandonment of ownership in favor of freedom and functionality.

For companies, the subscription model provides a predictable, resilient revenue stream. Even during global crises like the Covid-19 pandemic, 80% of subscription-based businesses continued to grow.

The XaaS Revolution

The digital world led the way with XaaS  that is Anything as a Service. By using cloud computing and the Internet of Things (IoT), companies have blurred the lines between hardware and software.

• SaaS- Software as a Service (e.g., Google Workspace, Zoom).
• IaaS/PaaS- Infrastructure and Platforms as a Service.

Connected objects now allow physical manufacturers to capture data and offer smart services, turning a one-time sale into a lifelong relationship.

The service economy is a vital offshoot of the circular economy. It breaks the extract-manufacture-throw away cycle of the linear model. Since the company retains ownership of the goods, they are incentivized to build products that are durable, repairable, and easy to recycle. In a traditional model, a company profits by selling more units. In a performance-based model, a company profits by providing the ideal amount of units while using as little resources as possible. Thus efficiency becomes the profit driver.

We are moving toward a world where dis-ownership is the norm. While we have always rented experiences, this logic is now permeating every object in our daily lives.

The Litmus Test of the Modern User

If you are willing to pay $1,000 for a functional smartphone but wouldn’t pay $10 for that same phone once it breaks, you aren’t paying for the metal and glass. You are already paying for the service. As this invisible transition accelerates, it will challenge our legal, fiscal, and behavioral frameworks. We are witnessing the end of volume logic and the birth of a society where use is king.

References

https://www.romainpoulles.lu/post/circular-economy-and-the-rise-of-dispropriation-or-dis-ownership