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The Death of Freemium

January 02, 2025

@trizin

The Death of Freemium: How LLMs Like ChatGPT Are Rewriting Internet Business Models

For decades, the internet’s unspoken contract was simple:
You create free content → Search engines send free traffic → You monetize through ads or upsells.

But LLMs like ChatGPT just nuked this model.

Here’s why freemium is dying—and what’s replacing it.

The Broken “Sacred Oath” of the Internet

Old Model:

  1. Write free blog posts/guides (fueled by SEO).
  2. Google sends traffic.
  3. Convert visitors into freemium users or ad revenue.

New Reality:

  • ChatGPT eats your lunch: Users ask LLMs for answers instead of clicking your SEO-optimized article.
  • Traffic plummets: Why browse 10 links when ChatGPT summarizes everything in seconds?
  • Freemium starves: No traffic → No free users → No upsell pipeline.

Example: A “how to start a LLC” guide that once ranked #1 on Google now gets 80% less traffic because ChatGPT answers the query directly.

Why LLMs Crush Traditional Freemium

1. Zero-Click Knowledge

LLMs don’t just answer questions—they prevent users from needing your site. Your free content becomes training data, not a traffic driver.

2. Ad Revenue Collapse

With fewer visitors, display ads and affiliate links (the backbone of freemium) generate pennies.

3. Upsell Friction

If users never reach your site, they’ll never see your “Upgrade to Pro” CTA.

The Future of Monetization: 4 Post-Freemium Models

1. The “Un-Googleable” Product

Build something LLMs can’t replicate: hyper-specific data, tools, or communities.

Example:

  • Old freemium: Free blog + $99/mo SEO tool.
  • New model: $299/mo “Local SEO Mastermind” with city-specific search volume data updated hourly (too niche for LLMs to scrape).

2. API-as-a-Service

Sell LLM-powered automation to businesses, not individuals.

Example:

  • A real estate agent pays $500/mo for an API that auto-generates hyper-localized property descriptions using MLS data + ChatGPT.

3. Hybrid Human-AI Solutions

Charge premium prices for outcomes that require human expertise + AI speed.

Example:

  • Old: Free resume template → $7.99/mo “AI Resume Builder”.
  • New: $997 “Executive Career Accelerator”: AI-optimized resume + 3 Zoom sessions with a Fortune 500 hiring manager.

4. Pay-to-Play Communities

Replace free content with gated, high-value networks.

Example:

  • A cybersecurity newsletter moves its free blog posts behind a $50/mo membership forum where members share live breach data and threat detection prompts for ChatGPT.

Case Study: How PlantParent Pivoted

Before:

  • Free plant care blog (1M monthly visitors) + $9.99/mo “Plant Doctor” app.
  • Post-LLM: Traffic dropped 65%, subscriptions stalled.

After:

  • Killed the blog. Launched $49/mo “PlantGuardian”:
    • AI pest diagnosis via app.
    • Live video consultations with botanists.
    • Members-only marketplace for rare seeds.

Result: 1,200 subscribers in 3 months ($58.8k MRR) with 80% less traffic.

The New Rule: Own the Outcome, Not the Traffic

LLMs commoditized information—but they can’t commoditize:

  • Ownership (exclusive data/assets)
  • Access (networks, expertise)
  • Results (done-for-you services)

Freemium relied on attention. The future belongs to models that monetize scarcity and irreplaceable value.

PS: For Mentorship members asking “How do I start?”—the answer is niching down so hard your product becomes immune to AI. More in our next session.