Freemium pricing is a business model that offers basic services or products for free while charging for premium features or enhancements. This approach allows users to try a product without any financial commitment, encouraging them to explore its capabilities. If they find value in the service, they may choose to upgrade to a paid version for additional benefits. Many software companies, such as Spotify and Dropbox, utilize freemium pricing to attract a large user base. By providing a free tier, they can generate interest and engagement, ultimately converting a percentage of free users into paying customers for their premium offerings.