The Guardian had an article in their G2 section today about how Chris Anderson, editor-in-chief of WIRED, is convinced that free is the only way to go:
On the web, the marginal costs of manufacturing and distribution are zero, or close to it. This means that you can now experiment with giving away one thing to sell something else much more than you could in the pre-internet era. The traditional model is of giving 1% of goods away as samples in order to sell 99% of the product; on the web, you can give 99% away as free samples to sell 1%.
When it comes to music, the idea is that a band can gain popularity by giving music away, which creates new fans who will then tell their friends, buy merchandise or attend concerts.
Anderson’s last book, The Long Tail: Why the Future of Business is Selling Less of More, argued that it’s possible to thrive by appealing to niche markets. His next will argue that the future of economics is inevitably free:
In every industry where the product can be made into a digital file, somebody is, or is going to be, offering you that product for free because the marginal cost of doing so online is heading towards zero. Divorce papers? Free. Books? Music? Free.
He doesn’t see this as negative. Things have changed, as they always have. Money will continue to flow, but now the barriers to being heard and noticed are so much lower, and that has to be a positive environment for creativity.
Check out the full article by Stuart Jeffries at guardian.co.uk.
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