Question

Unplug Wireless is a cellular service provider that charges its customers $1 for three hours of talk time. So, if a customer's talk time for a month is 60 hours, the company charges him or her $20 at the end of the month. Which of the following business models does this best illustrate?

a. freemium
b. subscription-based
c. pay-as-you-go
d. razor-razor-blade

Answer 1

c. pay-as-you-go

Step-by-step explanation:

-Freemium means that a service is free but if the customers want additional features they have to pay for them.

-Subscription-based is when a customer takes a service for an established price during a specific period of time.

-Pay-as-you-go is when you pay only for the services you use.

-Razor-razor-blade is when a business sells a product at a low price to be able to sell a complementary good.

According to this, the answer is that the business model that is best illustrated is pay-as-you-go because the customer pays for the talk time he/she consumes each month.