Chris Anderson, editor-in-chief of Wired is a man with a radical vision of the future. Observing trends created via the Internet, Anderson envisions a future in which things cost less, rather than more, a world in which the very nature of the digital world means things which were once available only on a paying basis, become available for free. He’s outlined his vision in his book Free: the Future of a Radical Price( ironically available for $21.49 on Amazon).
The entire premise of this work is based on the concept that, thanks to the underlying technology of the Web, things (at least digital things) are getting much cheaper. Due to advances in computer science, Web-mail services like Yahoo can now offer their users unlimited storage space for free. Similarly, because of globalization the price of many manufactured goods has dropped drastically (thank you China). Anderson expects this trend to continue, and even grow.
Of course, as he is quick to point out, this trend towards free doesn’t mean no one is making money. Instead, the burden of purchase has begun to fall not on consumers, but rather upon advertisers, Web businesses, etc. A case in point of this would be Google. Google offers all sorts of e-services from email to search engines for free. And how does it fund this massive digital empire? Why with sponsored advertising, of course.
Other means of revenue generation and innovation Anderson outlines are premium services (i.e., the basic service if free, but users must pay for the good stuff), cross-subsidies (buy this, get that), labor exchange (e.g., fill out a survey and receive access), and altruism (shareware written out of the goodness of a programmer’s heart).
According to Anderson, the entire concept of free will change everything. This is probably best demonstrated in the music industry. No one buys CDs anymore, and it’s probably safe to assume that many people don’t even pay for downloads. With the rise of file-sharing networks like Napster and Limewire, to the emergence of services like MegaUpload and RapidShare, never before has music been shared so easily. As as a result, the giants of the recording industry are witnessing their own destruction (not that many music lovers have much sympathy). Many people, including lots of artists, feel that music was made to be shared, and actively engage in what might be termed as “piracy”. Though it has cut deeply into the massive profit margins of Island, RCA, et al, kids today are exposed to more music in a week than their grandparents were in their entire lifetime. According to Anderson’s theory, this is the model that will be followed by more and more industries in the future.
Of course, not everyone agrees with Anderson. Malcom Gladwell of the New Yorker posted a rather unfavorable review of the book here.
Is free the future? It seems only time will tell. Until then, Anderson’s theory is definitely worth a longer look.