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July 2009 Archives

July 9, 2009

Information Doesn't Want to Be Free - It wants to Pay!

The Chris Anderson/ Malcolm Gladwell PR stunt public debate over the value of the freemium business model got me thinking about whether information really wants to be free. Perhaps it doesn't want to stop at free.

In the offline newspaper world, advertising always kicked circulation's butt when it came to revenue. More readers meant more ad revenue. So it only makes sense that newspapers would price their product to maximize circulation. So wouldn't a free product maximize readers and therefore revenue? Turns out that offline, no.

There are free alternative weeklies and free local weekly/ dailies like this one all across the world. They all tend to be smaller circulation than the papers that charge money for circulation.

Offline there is a perceived qualitative aspect to things that cost consumers money. It's precisely because they are NOT given away that people assume there is value. So it makes sense that offline newspapers didn’t give away their product. It would have made it less valuable.

On the web, however, there is a cultural expectation of free. This has been created over the past 10 years. People don't devalue free content. On the contrary, they expect it and embrace it.

What people do devalue on the web is being paid to use something. When Microsoft (pre-bing) or Iwon.com pays people to search or a social news sites pay people to post stories or a community site pay people to contribute, people run for the hills. Paying them to use a product messages to users that the product itself has no value on its own. Just like free does to a product in the offline world

So maybe the line keeps moving. Offline free is bad. Online free is good. Online getting paid is bad. Who knows, maybe as info migrates to places like the mobile browser and elsewhere, paying users will be good.

Personally I hate consuming news on the mobile – too hard to read. In fact, you might have to pay me to do it! If the CPM's are there, it might make sense for a publisher to do just that. Maybe information doesn’t want to be free. Maybe its price is set by the medium in which it is distributed.

About July 2009

This page contains all entries posted to Marksonland in July 2009. They are listed from oldest to newest.

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