Free is not a business model. Free is how you smash old crappy monopolies and how you force businesses who don’t give a rats ass what their consumers want to pay attention. Free is how you get some momentum so you can prove there really are better more efficient ways of doing some things. Thanks to YouTube I can now watch TV on my computer (Hulu) and a premium video streaming service exists (Vimeo).
Jason Pontin, Editor in Chief and Publisher of Technology Review delivers a brilliant manifesto with a plan to save media (here).
“For many decades, publications were overdistributed to readers who didn’t really want them, because publishers were former ad salesmen who hoped to profit by charging advertisers the highest possible rates.”
[…]”Editors can charge readers for content that is uniquely intelligent; that relies on proprietary data, investigation, or analysis; that helps readers with their jobs, investments, or personal consumption; or that is very expensively designed. Everything else should be available free…”
Chris Anderson, Editor of Wired has been working on a book about free that’s set to launch this summer (here), but I suspect he’s going to take a real thrashing on this one since it seems the tide has turned on free. All anyone is talking about these days is subscriptions, premium upgrades and advertising. All have free components to them it’s just not a big deal anymore. We know that if someone charges money for a product and you offer that same product for free you will attract more people. If you don’t have a way to make it profitable it’s called a trust fund not a business.
Here’s what the red hot Economist has to say on the matter:
“Ultimately, though, every business needs revenues—and advertising, it transpires, is not going to provide enough. Free content and services were a beguiling idea. But the lesson of two internet bubbles is that somebody somewhere is going to have to pick up the tab for lunch.” More (here).
And finally if you want read a fantastic analysis on the situation facing three largest business magazines all founded at the beginning of the modern era of magazines read 24/7 Wall Street’s: The Sun Sets On BusinessWeek, Forbes, And Fortune.