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Not sure that's necessarily true. Just because someone pays for a subscription doesn't mean they won't have favourite authors that they want to read and are willing to pay for. The question comes down to whether there's enough books, and enough of the right books, they want to read in the subscription catalogue.
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I am using KU, so is my husband ( both kindles on the same account )
I think we are getting decent value out of it, but it doesn't stop me buying other books. I choose the books via the PC, when I have read them I go to the PC, return them, choose new, and turn on the 3g or the wifi for five minutes. Old books gone, new books come.
Just like the library. Except I can get them again, no waiting, if I should want to re read. I'm happy with that.
Since I found out about the payment system, I make sure to go to the end before I return them, unless they are so bad that I don't think the authors deserve paying. Not many are. Some are public domain, so I guess Amazon don't pay for those.