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Video 5 - Introduction to Online Business Models

IBMS Semester 6b Fall 2013 Mr. George Szanto. Video 5 - Introduction to Online Business Models. Topics of this lecture. Introduction to 10 different online business earnings models The rise of the “ F reemium ” business model on the Internet. Learning Goals For This Lecture.

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Video 5 - Introduction to Online Business Models

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  1. IBMS Semester 6b Fall 2013 Mr. George Szanto Video 5 - Introductionto Online Business Models

  2. Topics of this lecture Introduction to 10 different online business earnings models The rise of the “Freemium” business model on the Internet

  3. Learning Goals For This Lecture Be able to name 4 – 5 different online business models Name 3 technological changes over the past 20 years which have helped make the Freemium model viable Understand how cross-subsidies support Freemium off-line and online business models Be able to come up with 2 examples of online Freemium models which are NOT talked about in this lecture Voettekst

  4. Taxonomy of 10 Online Business Models

  5. Rise of Freemium Online Business Model Canitbereally Free? Off-line/On-line free models Cross subsidy model

  6. Cost of Web Services going to $0.00 • In 2007 – unlimited Email Storage from Yahoo • Bandwidth getting cheaper (fiber optics) • Processing Power get cheaper (Moore’s Law)

  7. Software Economics – prices go down each year – until it’s FREE • Open Source Free Software

  8. Freemium Business Model Characteristics • Old - Off-line: • Give away a small amount of free product • Hope user’s get hooked and buy a LOT more • Newer - On-line: • Give away LOTS of free product; • Only a very small percentage of users pay for premium service ~ 1% • Create a huge community

  9. Facebook & Twitter – Free? What is the trick when you are offered a free service online via a social media link?

  10. End of Video - Thank you Please take the online quiz associated with this video and join the online discussion about Freemium Business models as well.

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