Freemium is a business model where a basic or limited version of a product or service is offered for free, while premium or expanded functionality is available through paid upgrades or subscriptions. It involves giving away core functionality for free to attract users, then converting some of those users to paying customers by selling additional premium features or services. Freemium works because digital goods have near-zero marginal costs of production and distribution, allowing companies to recoup costs through a small percentage of paying premium users while gaining widespread adoption through free basic access.
