As described in this blog post, there are only a handful of biz models for web apps, and there is one called Freemium.
"Most web apps make money either from advertising, subscriptions, or a mix of both. An app like Blinksale -- an invoice management tool -- is free for a small number of invoices sent monthly, and then charges a fee when you pass some threshold, like the fourth invoice. This is called the "freemium" business model."
Interesting name.
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