A Taxonomy of free for web businesses

• “Freemium”
  What’s free: Web software and services, some content.
  Free to whom: users of the basic version.
• Advertising
  What’s free: content, services, software, and more.
  Free to whom: everyone.
• Cross-subsidies
  What’s free: any product that entices you to pay for something else.
  Free to whom: everyone willing to pay eventually, one way or another.
• Zero marginal cost
  What’s free: things that can be distributed without an appreciable cost to anyone.
  Free to whom: everyone.
• Labor exchange
  What’s free: Web sites and services.
  Free to whom: all users, since the act of using these sites and services actually creates something of value.
• Gift economy
  What’s free: the whole enchilada, be it open source software or user-generated content.
  Free to whom: everyone.

from Free! Why $0.00 Is the Future of Business