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Why the Freemium Business Model Isn't What It Used To Be

Posted by samzenpus on from the first-bit-is-free dept.

mattydread23 writes: A few years ago, every enterprise software company was trying freemium — the idea of giving a product away to build users, then charging for additional features. Now, that model seems to be losing favor, except with open source software. Business Insider talks to enterprise founders and VCs to figure out why 'freemium' wasn't all it was cracked up to be.

2 of 82 comments (clear)

  1. Re:It was always a scam by l0n3s0m3phr34k · · Score: 3, Informative

    No one runs iOS on enterprise level hardware. Nor do you play any games on it. This guy tried to compete in an IBM level world, "enterprise class" like Oracle, SAP, RHEL, Microsoft (haha) and is running into requirements coming in from SLA's signed between other contractors. The enterprise world is a maze of cross-competing contracts that are all industry-standard set by external (ITIL, NIST, HIPAA, etc) policies. "It's free!" doesn't help with an SLA fine that can be in the millions.

  2. Re:Just shareware renamed by gnupun · · Score: 3, Informative

    But many freemium games allow you access to almost all the content (say 70-90% of the game) for free whereas shareware gives you only about 5-10% of the full game for free.

    Another difference is freemium content is 10-100 times more expensive (but buyers won't notice because they pay small amounts in micro-transactions) than full commercial or shareware games. The high price is because the premium content in freemium games allows the buyer to win easily against free players, which is not how shareware works.