The average cost ist always higher than the marginal cost for digital products, for obvious reasons. So you are literally saying free markets don't work for digital products.

That's not true. There are a number of obvious instances of it working.

YouTube/TikTok/etc.: The market price is zero, the service itself and much of the content is funded through ads.

Debian/Firefox/etc.: The market price is zero, the development is provided through user contributions/donations.

Substack/OnlyFans/etc.: The market price is not zero and then the content is often available for free anyway, but enough patrons choose to pay to fund its creation nevertheless, either because they don't know how to pirate or choose not to. Maybe this is the same as the donation model in all but the eyes of the law, but in any event there are objectively people making a living from it.

I'm afraid you don't really understand what you're writing about. Terms such as marginal cost and average cost are used only for goods, which are sold on a free market for a price. Your examples are services or freeware, you can't calculate marginal cost and average cost for a service or freeware.