This article was originally published January 7, 2013. Valid then. More valid now.
So much stuff is free. Facebook and Twitter are free. WordPress is free. Applications like Google Docs are free. Storage and sharing are free. Reviews are free. Fonts are free. Games are free. Music is free (some of it even legally). And above all else, information is free.
Of course, nothing is really free.
A lot of free stuff is supported by ads. Things like Wikis and user reviews are supported by volunteer labor. But a lot of very valuable services of very high quality and utility, like Skype, Spotify, Base, Dropbox, Mailchimp, HootSuite and LinkedIn, cost the majority of people who use them literally nothing. These are ‘freemium’ services, a business model that is probably familiar to you. To some it sounds nuts. But giving away an application or service for free encourages broad adoption and familiarity. Once in popular use, the application acts as kind of an ad for the more feature-rich paid subscription version of itself.
Even stuff that isn’t free is often free for a while, free in part or associated with related free stuff.
Non-freemium software is usually free for a trial period of 7 to 30 days. Sometimes longer. But there are less obvious freemiums. Like IBM’s hugely successful CityOne, a free SimCity-like game, the playing of which more or less directly promotes IBM’s Smarter Cities initiative. The New York Times’ “soft paywall” is another variation, with page limits only occasionally hit by casual readers.
One of the most ‘radical’ ideas – and I put radical in quotes because I think this idea will only be radical for a short time – comes from the world of higher education were economic and social forces are driving rapid change. As reported by Kevin Carey this April in The Chronicle of Higher Education, a for-profit venture called New Charter University has just launched against the freemium business model. As Carey notes,
Anyone can start work on their M.B.A. without paying a dime. You only have to give New Charter U money if you want access to real people who serve as academic mentors … or if you want to sit for a proctored exam and receive academic credit.
But a business or institution does not have to reinvent its industry like New Charter U or even invent and invest to the level IBM did with CityOne to step toward a profitable freemium relationship with its future paying prospects. In fact I will hazard a guess that your organization is already a minor freemium player. Because at the extreme left side of the freemium spectrum are things like the article you are now reading. While many blogs are published merely to improve search rankings, good ones, like this one, also offer value in the form of a small bit of intellectual property.
The goal here of course is that you’ll be so impressed by my thinking that you’ll contact me to think even harder on your behalf.
It strikes me that there is a big space between a point all the way to the left on the freemium spectrum defined by blogging, and the point all the way to the right defined by New Charter University. I for one am very much looking forward to working with my clients to help invent the communications solutions that will begin to fill this open field of opportunity.