[outotrai]

I'm very interested in that sort of business model - selling real or virtual products within a free application. I remember reading an article last year (http://arstechnica.com/gaming/news/2009/06/eas-new-motto-ple...) wherein the CEO of EA Games claimed not to mind piracy of certain games which had products for sale in-game. Many websites and applications seem to be using it to great success - IMVU and the social site Gaia Online come to mind. Somehow it seems strange to me that users who are so hesitant to buy something outright will pour their money into it when it is ostensibly free.

[jfarmer]

Every single Facebook game uses this model.

[cookiecaper]

It's kind of like giving a free demo, really. It's the same principle. You give someone a taste but limit the experience and allow them to unlock everything for a fee.

The difference here is that the fees are small and many, whereas in the old days it was just a one-time drop of $49.99, or whatever.

This model adapts better to an online, social context because it seems less restrictive, allows participation by everyone, and you can choose how much you want to spend on the experience, and how much of the experience is worth unlocking, and what parts to unlock at what times.

I think that it works well for systems like phone apps, where users just want to try something out before dropping much cash on it.

[access_denied]

At advertising school I learned in first grade: "every product has an economical value (to the buyer) as well as an psychological one".