“Free” is an interesting business book by Chris Anderson, the guy who originated “the long tail” of Internet marketing. He proposes that there are two price points on the Internet: free, and everything else… and it’s difficult to compete with free. Once a product or service is free, it’s difficult — almost impossible — to get people to pay for it afterwards. Ask the music industry. So how does one make money? THAT’s the subject of the book.
For example, Google gives away a 411 service whereas AT&T realizes lots of money for theirs ($7 Billion, if I remember). Is Google’s really free? No: They’re using the people who call in to train their voice-recognition system to handle languages and accents and getting a lot of information about what people are looking for, which they can use and package later. But to the user, it’s free.
There are clubs that charge the band a fee in order to play, and offer free admission to the audience. The band buys exposure; the club makes some money on the band, and more money from drinks. To the audience, it’s free.
Not done with the book yet, but I find it difficult to put down because it’s so head-spinning, which is odd for a business book, dontcha think?
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It’s difficult to compete with free…
“Free” is an interesting business book by Chris Anderson, the guy who originated “the long tail” of Internet marketing. He proposes that there are two price points on the Internet: free, and everything else… and it’s difficult to compete with free. Once a product or service is free, it’s difficult — almost impossible — to get people to pay for it afterwards. Ask the music industry. So how does one make money? THAT’s the subject of the book.
For example, Google gives away a 411 service whereas AT&T realizes lots of money for theirs ($7 Billion, if I remember). Is Google’s really free? No: They’re using the people who call in to train their voice-recognition system to handle languages and accents and getting a lot of information about what people are looking for, which they can use and package later. But to the user, it’s free.
There are clubs that charge the band a fee in order to play, and offer free admission to the audience. The band buys exposure; the club makes some money on the band, and more money from drinks. To the audience, it’s free.
Not done with the book yet, but I find it difficult to put down because it’s so head-spinning, which is odd for a business book, dontcha think?
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This entry was posted on Wednesday, September 16th, 2009 at 10:10 am and is filed under commentary. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.