Freemium, an amalgamation of free and premium, is a popular kind of business model where an organisation offers a basic version of their app or service for free, and a premium version that people can subscribe to in order to access extra features.
Many businesses use freemiums to try to get you to subscribe to their premium service, by loading their freemium offering full of ads, or making their freemium just a little bit worse so they can tempt you with their premium service. We’ve taken a look at the most popular freemium services, and some alternatives that you might prefer.
‘£500 every year on subscription services’
According to a UK government survey from 2021, ‘almost half (49%) of UK adults pay regularly for access to entertainment and books platforms such as Spotify, Netflix and Amazon Prime Video. This is followed by subscriptions to product delivery services (29%), charitable donations and newspaper/magazine subscriptions (both 16%). According to the Independent, ‘the average Brit pays out nearly £500 every year on subscription services’.
It’s no surprise that many of us try to use freemium services where we can, to access the apps we like without adding another recurring payment to our outgoings. However, as you might expect, tech giants don’t make nearly as much money from free users as they do from their paid users. According to Statista, Spotify ‘generated about 11.5 billion euros in premium revenue, and 1.681 billion in ad-supported revenue’.
Dislike, and subscribe?
When businesses offer a free version of their services, they can generate new users for their apps. This article, which is directed towards businesses thinking about offering a freemium service states that, ‘The key is to give just enough access so the user can start reaping the benefits. Start the paid plans at a stage where the user is too involved to want to stop using your product.’
By reducing the usability of their free services through adding advertisements, loading their premium service full of features or just changing the way that their app works, companies can encourage you to take up another subscription and move to their premium service. However, before you dislike the free service and subscribe to the premium one, it might be worth checking out these alternatives.
Spotify? Try Jango
The ad-supported version of Spotify is free for users to access, but like many freemium services, using the free version of Spotify means that you’ll be listening to a lot of adverts. Also, if you’re using Spotify on a smartphone, you can only skip six tracks an hour
‘Smart Shuffle’ is another way that Spotify makes their free product a little bit worse to push you towards premium. If you’re using Spotify on your mobile, you can’t select songs to listen to. Instead, you have to shuffle an album or a playlist, and ‘Smart Shuffle’ means that Spotify will add songs from similar artists in there too. This is a great feature, but it’s terrible when you can’t turn it off.
A great free alternative is Jango. Jango isn’t an on-demand streaming service, so you can’t choose which tracks you’re listening to; instead you choose customisable playlists based on an artist or genre. However, it offers an ad-free service when you create an account, and you can skip as many songs as you want. Perfect for those who just want to listen to Taylor Swift in peace.
Microsoft Suite apps? Try Google Drive
The free version of Microsoft apps utilises adverts to get you to subscribe to Microsoft 365. There’s a constant advert on the side of the screen, and every now and again a video advert appears and obscures your document or spreadsheet. You have to watch the advert in order to return to your file, which can be very frustrating particularly when you’re in a rush.
The free version of the Microsoft apps are also all read-only. If you want to edit a document, Microsoft prompts you to save a version to OneDrive, which is their online cloud based service, or subscribe to Microsoft 365.
Microsoft 365 is a comprehensive product, and if you’re a business user, you’re frequently writing or using spreadsheets, we think this is one service that is worth the subscription. However, more casual users could give Google Drive a try. Its personal version is free, it has 15 GB of cloud storage per user, you can create documents, spreadsheets, slideshows and forms, and you can edit documents with other people in real time.
YouTube? Try Netflix
YouTube is one of only a handful of video streaming services that offers a freemium, and with around 3.7 million videos uploaded every day, it’s definitely not short of content. However, like Spotify and Microsoft, you’ll have to slog through the adverts to watch what you want to watch - and YouTube has a lot of them.
The free version of YouTube also doesn’t let you download videos on mobile, although you can do this on your web browser to watch offline. Upgrading to premium means no more adverts, download videos on mobile, and you can access YouTube Music.
Finding an alternative for YouTube is tricky because it’s not as easy as switching to a free competitor like 4, or itvX, both of which feature ads when you watch for free. If the content you’re interested in watching is hosted on YouTube, there really isn’t a good substitute. However, if you are going to subscribe to a video streaming service, we’d recommend something with some more original tv shows and films like Netflix or Prime.
