
Free: a Tactic, not a Business Model - gustaf
http://gigaom.com/2007/03/13/free-a-tactic-not-a-business-model
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gustaf
Great Comment:

Anne,

Offering your content or service for free implies that you need to rely on an
advertising based business model. If you aspire to build a big online media
business (say $50m in revenues) you can do it in one of three ways:

1\. If youre broad reach, you need to grow to be one of the top 10 websites
in the US by traffic 2\. If youre demographically targeted, you need to grow
to be one of the top 25 websites in the US 3\. If you have content that
attracts endemic advertisers, you need to grow to be one of the top 150
websites in the US

Analysis and math that gets to these conclusions is at the Lightspeed Venture
Partners blog (click on my name in this comment). jeremy liew on March 13th,
2007 at 12:27 PM

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vlad
There are some crazy good comments.

(Josh Morgan):

The "business model" for many of these companies is to get acquired before
their money runs out. If that is the "actual" business objective, as opposed
to the publicly stated one, then FREE is a business model because it allows
them to grow more quickly.

On a personal note, I don't think this is sustainable or smart for the long
run.

