Like it or not, FREE is a business strategy that many top companies are using to reduce friction and to gain customers. It's a movement that has worked out phenomenally well for some and has been a colossal failure for others. FREE is here to stay, but how to use it wisely, that's what this book is all about.
Favorite Quote
"Free is, in short, a grand experiment that has come with the digital revolution and the economic implications of its extraordinary potential. Like it or not, it is one that most companies will have to embark on." ~ Chris Anderson
Key Takeaways
- When the marginal cost of something (bandwidth, storage, processing) approaches zero, its price eventually will too.
- Cross-subsidy is the real mechanic behind "free." Someone always pays, whether that's a paying tier, an advertiser, or a future purchase.
- Freemium works because a small percentage of paying users, often just 5%, can subsidize a much larger free user base.
- Free isn't a marketing gimmick anymore, it's a legitimate long-term business model when the underlying economics support it.
- The winners of free markets are usually the #1 player in a category. Everyone can use the model, but few get rich on it.