Nikos Moraitakis of Workable recently shared his thoughts about why they dropped free plan from service plans they offer. Read the article for details. To me summary is simple, free is not a sustainable business model. I am sure others have shared similar thoughts but it is important we highlight them as they are rare.

I keep going back to Malcolm Gladwell’s classic review of Chris Anderson’s book Free. Malcolm is spot on describing why making product and services free is not that simple. In Malcolm’s words

There are four strands of argument here: a technological claim (digital infrastructure is effectively Free), a psychological claim (consumers love Free), a procedural claim (Free means never having to make a judgment), and a commercial claim (the market created by the technological Free and the psychological Free can make you a lot of money).

I am sure you will agree that there is a cost to invent / create product and or service. Then there is cost of acquiring millions of users . Of course even though digital infrastructure is getting cheaper but for millions of users, cost cannot be simply rounded to zero. Add all this and we know well that there is a cost for free. Free is interesting and can draw initial attention no doubt. However I think if not impossible, free product and or service is very difficult to sustain.

PS: Even Chris in his response could not actually defend all the questions Malcolm raised. See some of the comments on his response as well.