Free-mium is a very precocious model. It is very difficult to get the balance right in service terms, namely how do you decide what to put in the premium servic

Free-mium is a very precocious model. It is very difficult to get the balance right in service terms, namely how do you decide what to put in the premium service and not in the free one. The free-mium model has never taken traction in other industries, as normally for something to be commercially viable, the free service should be good enough for people to pay for it. Think of Shakespeare's theatre - people were prepared to pay for even the crappest places in the audience because the product itself was good. I think tiered, subscription based business models will be the most likely development, especially in a recession when the main barrier to going down the subscription path - that a competitor could come along and offer the same service for free - is becoming less relevant given the VCs are becoming less willing to subsidise such practices.