The freemium flaw: The challenges faced by freemium – TNW Insider
Close your eyes, and cast your mind back to the first dotcom boom in the late 90s/early 00s. What’s your overriding memory of that whole crazy period? Or if you’re too young to really remember, what do you immediately think of when you hear dotcom bubble or dotcom boom mentioned in relation to Silicon Valley at the turn of the millennium?
I’m going to take a stab and guess that it has something to do with over-inflated valuations of ill-conceived, kooky ideas. Okay, that may be wide of the mark for some of the companies that are still plying their trade today, such as Amazon, eBay and Google. And of the many ideas that didn’t work out, not all of them were inherently bad, they were simply ahead of their time.
We’ve discussed this subject before, looking at why the original dotcom boom of a decade ago isn’t the same as today, and why we won’t see the same widespread collapse of the digital industry. In the intermittent years between the two dotcom booms, technologies, attitudes, skill levels…everything, has caught up. So even if companies such as Groupon were to fall flat on their faces tomorrow, the bubble would probably still remain intact, simply because the Internet ecosystem is far more robust – companies rise and fall as they have always done, but e-commerce is here to stay.
One of the reasons why so many companies failed before was that there was a broad lack of understanding about monetizing the Web.