Free is complicated

One of the strangest aspects of an economy is what happens when things are free. And in the new internet economy we are seeing some really strange effects.

One of the most obvious free things are blogs. Here you are reading something I have created for free. Not only that, but I have published it for free as well using software that is also free. So who is paying for this?

Like most bloggers, I am doing this because I enjoy it. Also I see it as Richard Herring puts it on his blog – I am “warming up”. But what about the corporations involved, why do they do it? They largely see blogs as free content to hang their adverts on. They might not even force you to have ads on your blog, in fact there are no ads here, but they know that most users will realize over time that they can charge for content (through advertising) and enough of them will do it to make it a hugely profitable business.

People’s expectations change when things become free. If you try and give something away people will assume it’s worthless (well no surprise, you just told them that in the price) but if you charge for the same item, people will buy it. This has been well-established and still is the way the economy works out in the physical world. But on the Internet this relationship has been broken. We have now all learned that free products on the Internet can often be very valuable. In many ways it is advertising’s fault – it allows the company to charge us without consent. When you watch a TV show, you don’t feel like you just paid for it, but you have. Or at least you will. Or perhaps you are one of those people for whom advertising doesn’t work. You realize everyone thinks they’re immune to it? You can’t all be right.

The strangest effect of free things is the incredible expectation of quality. Products from Google aren’t just useful add-ons to your computer, they are tools people use all the time. I have at least one of their products open at all times when I’m online (Google Reader, if you’re interested). The amazing thing is that they are useful and they work – and they’re free. But this leads to some wacky expectations of free products. If you look at the comments on (Dilbert-creator) Scott Adams’ blog, you’ll see some pretty critical comments. Scott’s blog is so good, that when he fails his readers in some way, they complain. Usually they seem to get upset when he says he’d like to make money from his activities or when readers don’t agree with their interpretation of what Scott said. The question has to be, what right do they have to complain? He didn’t force them to read the post and he gave it to them for nothing.

The final point is from Joel Spolsky. Joel is a software developer. He warned other developers from making custom-ware, saying that trying to please everyone is a recipe for disaster. Perhaps Scott should realize that his repeat customers are unlikely to be the ones complaining. But on the other hand he has boxed himself into a bit of a corner. His posts largely annoy stupid people who leave, and smart people don’t click on ads.

My suggestion to him? Split the blogs. The Dilbert blog can have all of the silly stories from around the world and the heart-warming ones too. Then on the Scott Adams blog he can talk about his philosotainment. I know I’d still read both, I just think it would make it more enjoyable for him.

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