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To follow-up on your ad-based and freemium models, these need to be enhancements to the business model, not the focus of it. In other words, the subscription (revenue generating piece) of the business model needs to be done first, then once you have users you can use the other two models to enhance the revenue streams. Advertising example: once I know who my users are and understand the demographics, I can market my service to advertisers who are willing to pay top dollar to access these eyeballs. Freemium example: Once I have subscribers and understand the features that are valuable, I can create a freemium model without those features to offer to people knowing that they will want to upgrade to the feature rich version. To your point, freemium is way misunderstood. People do it the other way around, going free first and then trying to figure out what features people are paying for. BTW, outstanding post. It's also generating considerable noise on other blogs, so thanks for initiating the conversation.
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Feb 2, 2010