Chris Anderson of The Long Tail fame has just launched his latest review of the digital world; Free – the future of a radical price. It takes a look at the ‘Free’ attitude we have towards content and ‘stuff’, all caused by the web. I haven’t read the book yet, but feel it might be a bit of a management text book overhype/also ran. It’s an interesting area, but not an earth shattering concept…the free/paid struggle on the net is something the industry lives with all and every day.
Let’s face it; the ‘plight’ of the music industry is old hat. File sharing has been around since the beginning of the web, some ‘free’ sites are heavily subsidised by a bigger profitable brother (read YouTube et al) and rogue websites selling cheaper products are popping up and being closed down all over the place. All of these provide free or cheaper products and as a result or time and people getting used to it, this is now ingrained in a user experience. It’s a business condition.
In reality though, each instance does have a cost. It might not necessarily be attributed directly to the user, but there is a cost nonetheless. Ad funded to support ‘free’ content has been the model of the TV stations and newspapers for longer than most of us have been alive. The music industry is no different; the songs are now ads for concerts, public appearances, endorsements (all massively increased and highly lucrative) and record sales. ‘Free’ applications use different cost models too; some, like Google Mail have user limits and advertising, some use open source to fund development – i.e. people enjoying doing stuff for others for ‘free’.
Some sites provide free information about things to encourage a ‘retail’ sale which is viewed by non-transactional customers; travel sites for example. Some sites simply charge, with cost models operating from the ridiculously cheap to the full charge with associated benefits.
This idea of instant gratification without cost is nonsense, and we all know it. If it weren’t, the commercial world would cease to be, on or offline. Yet there will always be people selling fake goods at the market and still the world does business. We are in slightly new territory with a lot of these virtual concepts, and a lot of the business models themselves need to prove their sustainability, but that’s nothing new for a market segment.
The bottom line is that the web is not free, and there are a myriad number of payment mechanics cursing through its veins, we just don’t always perceive them. Sure you can get by on free stuff, but if you are a serious player you will eventually need to upgrade and most of the time getting a decent content management system for example is worth much more to your customer than the set up cost is to you. The real win is that with all the variable options for your infrastructure, your costs will remain flexible and that’s a massive advantage. That’s the beauty of the web, all of these options exist, you know about them and it’s only because of the web that some of these options are possible. It’s simply a case that your business choices are freer than ever before and that brings your costs down.
As to Chris’ book, save yourself the cover price, read the reviews and excerpts online for free.
