What is freemium?
A quick definition of the freemium pricing model, where it came from, and what happens when you bolt monetization onto a free product.
Sources
- [1]Freemiumwikipedia
- [2]Freemium Isn't Freewikipedia
- [3]Free imperial citywikipedia
- [4]Study of Monetization as a Way of Motivating Freemium Service Usersarxiv
- [5]Monetization as a Motivator for the Freemium Educational Platform Growtharxiv
The short definition
Freemium is a pricing strategy where the basic product is free, and you pay for extras: advanced features, services, or virtual/physical goods that expand what the free version can do [Source 1]. The word itself is a portmanteau of "free" and "premium" [Source 1].
If you've ever hit a paywall on a note-taking app, bought gems in a mobile game, or upgraded a SaaS tool to unlock the team plan, you've used it.
Where it comes from
The model has been around in the software industry since the 1980s and sits close to tiered service pricing [Source 1]. The video game industry runs its own flavor of it called free-to-play [Source 1].
Free-to-play got popular enough to become a cultural punchline. South Park's 2014 episode "Freemium Isn't Free" went after mobile freemium games like and , drawing a line between freemium addiction and things like gambling [Source 2]. The episode picked up an Emmy nomination for Outstanding Animated Program [Source 2]. Worth knowing: the model has critics, and they're loud.
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