This question comes up surprisingly often both from end users as well as partners. On reflection, it is easy to see why: real business users want to see a viable business model before they commit to a supplier. They don't want to entrust their data to a company whose business model is unclear.
First a note of clarification: I am talking about business use here, not personal use. As we have reiterated many, many times before, personal use is free and will remain free. The best "marketing" for us is done by the personal user who is thrilled with what she sees and spreads the word. And we have a lot of fans who work for major companies, and while there is not a chance that they can use Zoho through their organization (yet!), they love the flexibility it brings to them in their personal capacity.
Now, we do charge for two Zoho services today: Zoho CRM & Zoho Projects. They both start with a free edition, and then scale up when the needs of the customer expands. I am happy to say the response has been tremendous for both services. Therein lies the answer to why we haven't charged for other services. We still have our work cut out to ensure that other Zoho services reach that state of maturity where a business user can get their work done on Zoho, without thinking about Zoho itself. That is my definition of maturity of a technology: it gets out of the way.
While at some level this goal represents an unrealizable Platonic ideal, we have to have a reasonable enough approximation of it before we declare it worth charging for. In each of our existing services, major updates are in the works which I believe will take us past that goal. When is it likely to happen? Predicting ship dates in software development is akin to astrology - with due apologies to astrologers everywhere, for comparing them to software project managers - but I think end of 2007 looks reasonable.
For those who worry about the business model of Zoho, I would point to the business model of AdventNet, the company behind Zoho. AdventNet offers a lot of free products - in fact, every product comes with a fairly generous free edition. In the beginning, those free editions "lose potential revenue", in sales jargon - my sales people always hate me when I propose "free". But over time, the benefits start to accumulate, and the product becomes profitable at lower prices to the customer and lower cost of operations to us. Is that just theory? AdventNet has been in business 11 years now, we have tens of thousands of paying customers (and millions of free users!); AdventNet's profit is funding Zoho, so we must be doing something right!
Still, why is taking so long? Simple reason: while some companies pursue a product strategy founded on minimalism (which is a valid strategy and has its appeal), our philosophy is to offer a full-featured product suite, satisfying that demanding user. That takes time.
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