Zelenka, Anne
13.03.2007
Free: a Tactic, not a Business Model (15.10.2010)

Argues that freemium is NOT a business model.

“However, the reason there’s a huge gap between people paying you nothing and people paying you something is because that’s where you go from hobby to business. Between zero revenue and positive revenue lies your business model. Going from zero pay to a penny is where you’ve discovered how to make money–and that’s what businesses are about. The penny gap separates the winners from the losers, economically speaking.”
-> You only have a business (and are sustainable) when you know how to make money despite selling for free.

“To be fair to these VCs, they’re not advocating doing everything without pay. They’re suggesting free as a tactic towards getting paid in other ways: through advertising, or by premium services (as in a freemium model), or maybe even through being acquired by a company with a large wallet. Free is only a tactic, though, not a business model.”
-> Companies still have to make money -> THAT’s the business model.