I don't think he said anything about absolutely needing to charge customers directly? "They make a product or offer a service and their customers pay them for

I don't think he said anything about absolutely needing to charge customers directly? "They make a product or offer a service and their customers pay them for it." In all your scenarios, there is an entity that is paying the company for a product or service rendered. They may not be a simple definition of the word "customer" but they are a customer none-the-less. I think the issue is more about smart business. No one is going to knock ning (and there would be no reason for their new strategy) if they figured out how to make money on their freemium model. But they didn't! And that's not good business. Obligatory google example: It's free. Yay, search all you want. Google's customers are the advertisers that pay for ad positioning. Yes the users are the customers too, but that does not mean that the advertisers aren't.