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Freemium is certainly not applicable for all products and services.

Phil Libin (CEO, Evernote) has a good framework to think about this. Simply put, if the value of your product to your customer increases over time and usage, freemium could be a good way to acquire customers [ofcourse, this works when incremental cost per customer is very small]. On the contrary, if the value remains constant or decreases, you are better off with charging right away or subscription model.

Phil has talked about this multiple times. I can't share the video of the FI session that I had attended; but I found a similar talk here. Warning: It is ~25 mins long. http://vimeo.com/11932184




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