Freemium is dying

For the longest of time the internet has been powered and filled with content for free. Or at least that is the way things have seemed to operate to the most of us. Nothing is of course free and most of us knew that deep down but decided to look away. Well, that era is now over. As 2023 is nearing its end the writing is on the wall, 2024 is the day when freemium finally dies.

But, before we predict the future let’s have a look back at the olden days, the history of the free internet.

In its early days the internet and its content had a lackluster finish. Things where free, and that did clearly show. It was a place for amateurs and hobbyists for the most part and then for a select few professionals and cooperation’s who did not supply their greatest work of a top-grade effort.

Over time it did however grow in popularity and so did the quality and early attempts to start monetizing the new and bold fronters. People did not want to pay however, and Ads and the Freemium model was the go-to solution. The notion that the internet was free became a well-established fact and people could get most anything, information, images, movies and music without ever having to reach for their wallets. Life was good!

Or at least many people thought so. Amongst all the free homebrewed materials piracy was running ramped and the industry decided to strike back. A decade of anti-piracy and court battles ensued, and, in the end, the old school freemium model was challenged by premium models from subscription services like Spotify and Netflix. It turned out that we would pay for content if the price was right, and the service was better than the free alternatives. We would gladly pay for content, but just some content.

We were still not inclined to pay for news or information in a broader sense. We have no interest in paying for content created by other mere mortals and social media and social interaction are not worth our time if they cost money.

So, the freemium model remained strongly embedded in more or less every part of the internet and things were good. We paid our does with the advertisements we had to sit through, like chores, and for some reason we felt that surely that was enough to pay for all the content, servers and bandwidth. Well, turns out that we were wrong. The information about us was sold as a commodity to advertisers to make us more direct advertisements. So not only did we pay with watching, or skimming trough, all adverts we were also paying with our souls.

More users meant more money and since loans and borrowed money where easily obtained and plain and simply cheap to uphold growth became the new benchmark. Both the freemium and premium model used this opportunity to overpower their offerings. If you paid for it, it was not even close enough to pay the bills and if things where free the revenue was fully in the red.

The status que continued until the economic slowdown of 2022-2023. Money is no longer free, and banks and investors hold their wallets closer to their hearths in a bid to cut their losses. Interest rates have shoot way up and there is nothing pointing to them coming back down or in the long run returning to their record low levels again in the foreseeable future.

So, what does this mean for the future of the internet?

Well, first of the free model is no longer viable as we know it. From a consumer standpoint there are two options, to suffer more and unskippable adverts that are harder to block and longer to watch or to open up our wallets for even more subscriptions to be able to get our fix of sweet online content.

On the other side, the content creator side, there is always the options to charge them, the creator, for the services. This would be a double edge sword for the end consumer. Content might still be free, but the content creator must still ensure a higher degree of revenue so adverts, sponsorships and merch will become even more prevalent. Smaller creators and new ones would also suffer as the bar of entry would be significantly higher. But then again, much of the lackluster filler would be removed so that might be a positive.

Or, we have the option to start paying for ourselves. This is already happening with solutions like Patreon and different kinds of membership. Today they are often for exclusive content but might in the future be the preferred and primary distribution channel, coupled with a broader subscription model where you get access to everything on a platform without adverts.

The latter is to me the most interesting option. If we go back to the old school linear model of classical TV or for that matter their modern streamed counterpart, we spend our lives watching countless hours of filler material. In average those commercials would end up to 11 days of constant watching in a year. A frightfully high number.

Not watching adverts could also quickly become a sign of wealth. If you can afford the internet without it, you must surely be doing well.

In conclusion, the writing is on the wall. The days of the freemium internet is over, and the premium model is taking over. This in conjunctions with the zombified remains of the prior will make the internet into a different landscape. You either live in the new paid advertisement free zone where things are much like they always where but without ads and irritating pauses or you enter into the twilight zone of endless commercials and flashing messages calling for you time, attention and money. The choice is yours!