Chris Anderson’s follow up to his popular book, “The Long Tail” does not disappoint, but rather provides an interesting look at the business of “Free” and how companies are profiting from adapting a free model. In “Free”, Anderson discusses the growth of free business from early examples such as cookbook giveaways to the growth and accessibility of information through the internet and other technologies.
Similar to Anderson’s argument in “The Long Tail”, Anderson analyzes how the growth of the internet, specifically the accessibility of information, bandwidth and storage, has made the cost of doing business a lot less, thus encouraging companies to provide free content to their users in order to build their business. Furthermore, Anderson discusses key companies such as Google who have made billions by providing users free content as well as a variety of free software. Interestingly enough, Anderson also discusses the downfall of free models with products such as You tube which costs Google money every year. However, the main point is that while free is not truly free, companies are still able to provide free content to consumers in hopes that it will yield bigger return in the end.
While most free models generate revenue from advertising, Anderson argues that the next wave of free is the gift economy. Specifically, sites such as Craig’s list which have no advertising and no expectation of monetary exchange with their users. The rise of users becoming empowered to create and run sites on their own has once again has reinvented the way people access information and has driven the cost of providing this information further down, making it even harder to compete. While the free model seems to be working in most cases, one can argue that Anderson’s acknowledgement of this gift economy may cause the free model to work against itself and ultimately lead to its collapse.
Overall, Anderson’s book provides an interesting look at the free model he coins as “freeconomics”, a selling strategy that has evolved since its earliest presence in the market. As the digital age becomes increasingly more important in how we communicate with consumers, companies will have to find new ways to attract users and free content is the way to do so. The book “Free” provides useful insight into how new tools such as Facebook and Twitter are creating new free strategies while cautioning against when free becomes detrimental to business. However, it is apparent that the free model is essential to doing business in the future and companies should not overlook its importance....Continua
it is not at the same level of "The long tail", it is less intriguing and illuminating
the book is entertaining, although not as insightful and inspiring as 'the long tail' by the same author. although it's quite clear why 'free' is so appealing to consumers, it's less obvious why it's a good business strategy. And in fact, the author admits this in the book: 'Everybody can use a fee business model, but typically only the number one company can get really rich with it.", at another place in the book the author states "in the early stages of a company or product, when it’s trying to get traction, free is the best marketing. It lowers the risk for new customers to try the product, and it increases the product’s potential reach. But over time, as the product or company becomes more established and better known, there’s less risk in trying it and free becomes less essential."...Continua
-argues that you can make money from free and people have been doing it for some time (for example, loss leader)
-gives ways to make money from free
-argues that an abundance in something creates a scarcity of something else (for example, the abundance in information today creates a scarcity of time to consume it all)
A nice books, it doesn't tell us anything ground breaking new. It lists smart examples on how economy and price definition works in the digital age.<br />In any case a "must read" book for anyone who wants to understand why everything in our world is changing so fast....Continua