I’m just fascinated by an article in BusinessWeek entitled Dude, where’s my digital car? It’s about Korean gaming company Nexon Corporation and its wildly popular Kart Rider [Korean language site]. Why’s it interesting? Because much more so than Sony’s Everquest and other online virtual games, Kart Rider is free, phenomenally popular and makes Nexon millions of dollars every month!

I know what you’re asking: If it’s free, where’s the revenue stream coming from?

What a great and obvious question! The answer is that Nexon has figured out how to apply the Razor Blade theory of marketing to online gaming, in a spectacular way. The Razor Blade theory, you might recall, is that you should give away the razor so you can sell the blades.

In this context, Nexon allows Koreans — and remember that about 75% of the Korean population have broadband connectivity — to play the multi-player cartoon racing game for free.

The money comes from…