Freemium is the merging of the words “free” and “Premium”, referring to services, software programs or mobile applications that are offered free of charge to users, but usually with limited functionality, since additional features are only available through an economic charge.
Origin of the Freemium model
The freemium business model originated from shareware programs, where users can download the software and try it for free, but only for a limited time or with a restricted feature set.
The Fremium model today
The freemium software model has become extremely popular recently following the release of iOS 3.0. of freemium mobile apps like Temple Run and Dragonvale, which are available for download on iOS devices like the iPad and iPhone at no charge, but users typically have the option to pay for additional features like power-ups, virtual money, restricted levels, special characters, etc., through in-app or website purchases.