Ever heard of 'Freemium Economy'?

Even if you haven't, you are definitely a part of it!

Freemium is a combination of two words: Free + Premium. A very successful marketing model that gives its basic product for free, and an upgraded version for a certain amount of fee.

There are so many amazing things in the technological world that are for free, have a look at iPhone and Andriod apps store, some of the best apps like Evernote, Google Apps, SlideShare, Skype or Angry Birds are available for free, and users interested in an advanced version, can easily buy it...and trust me, there are people who do pay for upgraded versions.

Phil Libin, CEO of Evernote has beautifully described the concept of Freemium: "The easiest way to get 1 million people paying is to get 1 billion people using."

Gaming companies that work on Freemium concept have proved out to be far more successful as opposed to paid games. These companies allow users to play for free, the only way for them to make money is through virtual currency and goods. There can't be a better example than Farmville.

According to Mavenlink, "The percentage of revenue generated from freemium App Store games in the United States in 2010 was 39% with the revenue from paid games at 61%. In 2011, the percentages flip flopped to 65% and 35%, respectively. In short, freemium has overtaken premium in revenue earned in the app store."

They have recently created a very informative infographic that provides eye-opening facts about Freemium Economy:

price of free

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