The staff here at Fusion Bay read a lot of blogs. A few we read are written by popular Venture Capitalists — not because we’re looking for investments, but because they’re interesting to read and seem to have breaking news about new web services and technology companies.

I came across an article today on “The Penny Gap” which I thought was worth a mention: It talks about consumer based web applications and the difference in free vs paid-subscription revenue models.

The article talks about the negative trend of price vs adoption… the more you charge, the fewer subscriptions you receive. That seems logical: fewer consumers can afford your service the more expensive it is. But I wonder: Is there a price point that might increase your adoption? Will more consumers subscribe to something priced higher because they perceive it as higher quality? Or are higher quality things just more expensive?