The notion of a sustainable business model built around "give away something and entice people to buy more" isn't new. It's something of a variant on the "give away razors in order to sell blades" idea that the shaving people, and the game console people, and the desktop printer people, etc have all used. However, unlike those models where the bit you get for free is essentially useless without the additional stuff you buy, this model is one of giving away something that is useful in and of itself, and then building on that with added content.

I'm reminded of my recent experience with the Steam gaming system. Steam's desktop client is free and it lets you easily hook in non-Steam games. But it also serves as an ad platform for Steam-supplied games, some of which are offered at very low or even free prices. I got one such game and enjoyed playing it enough to put down $10 twice on DLC (downloadable content) modules for it. In addition, I've now used the Steam search/ad engine to find another cheap ($10) game that I'm planning to try out and if I like it I'll probably throw more money at it.

My informal browsing shows that game companies are doing more and more with free demo versions of games. You give people the experience, get them interested, have them invest some time in making some progress and then see if they're willing to pay money to go further. It's an interesting model and one that might be profitably adopted in other industries.