Week 4 - Internet Business Models

It was interesting to learn about the different Internet business models. A brief summary of the 5 patters of business models:

1. Unbundling business models for 3 types of organizations: Customer relationship, Product Innovation and Infrastructure
2. The Long Tail
3. Multi-sided platform model
4. Free, Freemium and Open Source Freemium
5. Bait and Hook 
6. Open business model

My impressions are that in the digital world, Free business models will increase in popularity. Most of the Internet is already free: email, social sites, photo sharing, cloud storage, office services, .. the list goes on. Most of what is paid today (like advanced photo editing, video editing, ...) may become free in sometime. The proliferation of multiple devices is driving the need for people to store and work in the cloud. The days of standalone applications (like MS Word and PhotoShop) may be limited. Microsoft and Adobe have recognized this and are building collaboration tools for these products that add some benefits of competing cloud products. The prices of these products are coming down each day. 

Free is also eroding into Microsoft's Operating System revenues. Microsoft has declared that it is going to offer its Windows Phone Operating System for free on devices with a small screen size (9" or less). This is to compete with Android which works on a Free business model.