Stupid model, but that works almost everywhere. You're kind of describing support departments. The are entirely funded off added cost to the purchase price of the product, but more accurately, customers who paid for the product and didn't use support paid for other people to use support.
The same goes for shipping in a slightly different context. We made a model of weighted averages where essentially a "tax" was added to the median products to subsidize the shipping cost on the larger products. So the more frequent purchases made up the difference for the more infrequent (heavier/long distance) purchases.
obvi this happens everywhere, I just wanted to break down that this is not new and companies everywhere do something similar because selling anything almost anywhere is "unsustainable" in many ways.
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Yeah but in this case, it’s a one time fee for a recurring expense. And the amount of money that comes in has to keep increasing over time semi-exponentially to be sustainable, or the costs need to be cut (you get worse service).
This is worse than cross subsidization which is doable if managed right.