Alex Iskold wrote a very interesting article called “the danger of free“. He arguments, that the openness of the online society may have much worse results than we think or expect. He bases his thoughts on 4 reasons:
1. Free doesn’t make sense.
In the brave new world, subscription fees are gone and the salespeople are replaced by CPM advertising engines. The problem is, things are just not that simple. When the economy is bad (think 2008), then advertising is the first to be cut….The traditional subscriber base, which helps companies navigate through the economic downturns, is just not there, because it is no longer cool to charge people for the service.
I agree, that a good subscriber’s base could help a company get out of a bad situation. Being free doesn’t necessarily change that.
Openness hasn’t enabled only free services or products, it has also developed an increasing social sense of the public. Donations are not an alien practice anymore. Many bloggers have this cute ‘buy me a coffee’ button and wikipedia receives great amounts through donations.
If a company isn’t getting well, due to an economical recession, I trust its subscribers would donate to keep it working.
2. When free is dirty
While it is not clear that a lot of businesses in an economy can be supported only by advertising, we already know that free can be a powerful weapon in the hands of big companies.
Alex uses the example of IBM, which provided free services and opened the doors to sell the most expensive products and in the end created a monopoly, which led to a lack of innovation in software tools.
I don’t understand how a free tool can improve sales of another product, if these products are not combined or embedded. The Internet Explorer story is an example, yes. Microsoft embedded the online experience with its software. The IBM isn’t. As Brent posted in the comments (22nd comment):
…how can any IDE, open source or not, improve sales of commodity blade servers? It can’t.
I also don’t find it wrong, when an open source tool is so good, that there is no necessity for development. I’m not an expert, but isn’t the apache server doing this in the market too?
3. From free to an empire
In its endless quest to organize the world’s information, Google is also looking to kill off its archrival Microsoft. Just like Microsoft is going after search, Google is after one of Microsoft’s juiciest markets – Office.
A little competition never hurt anyone (almost anyone) and especially not the market and the consumers.
The point is that Google can afford to give away everything for free because of its success with search. This is being done openly now and it is just plain wrong. It is a dangerous poker game, where Google can raise stakes because it has a huge pile of cash.
And Microsoft can’t afford to give away?
4. Generation free
We are raising a generation of kids who do not want to pay monthly subscriptions for anything. Give me stuff for free and stick some advertising on it.
There I agree. It seems immoral or sold-out, to accept free stuff and accept being the ‘lab rat’ of marketing.
But I see a great difference between free products and free software. This is another field of discussion. We can’t compare hard working people buying material goods and web surfers using software. I find Friedrich Kittler’s text “There is no software” an interesting insight on the subject. (I actually suggest taking a look to more of his texts)
Conclusion
I suppose Alex’s post had on purpose a controversial structure. When the largest part of the online community advocates for openness, Alex’s post came as a big debate.
- I’m also one of the advocates of openness (not only in software). Probably, because I trust people will give something in return – and I don’t mean money. I also believe in balance. Do something good and it will come back to you. I believe in the wisdom of the crowd.
- The web has enabled the development of countless niches. Chris Anderson’s Long Tail explains perfectly, that each niche regardless how far in the tail it stands, receives attention. Openness has enabled users to develop more interests and to discover new possibilities.
But that’s where Alex’s thoughts are mostly intriguing. Is openness always used for a good cause?
Terry Heath responded on 18 Jan 2008 at 5:37 am #
This is an interesting article, and along the lines of something I’ve been considering lately.
Although much is free on the internet these days, I find I’m still willing to pay for information if I believe it will be authoritative. As a matter of fact, I seem to trust the information better if I’ve had to pay for it.
I’m not sure about your comment that when an open source product is good there is no necessity for development. You’re using WordPress for your blog, and even though WP is very good it is still continuously being developed.
robojiannis responded on 18 Jan 2008 at 10:35 am #
@Terry
My bad. I used the wrong words I guess. What I meant was, that if a program (open source or not) is very useful and very good at its field, it is hard to replace it with another program. Replacement can happen when a new program comes along, that brings something new.
Wordpress for example. Or firefox. They are ‘authorities’ in their field. They are constantly developing to remain authorities, but you don’t see any other blogging platforms or browser developed. If there was one developed, it should provide something new; so that users will make the leap, leave the pretty firefox and continue with the new software.
I’ll correct the sentence of the article, it’s wrong. Thanks
Kila Morton responded on 18 Jan 2008 at 10:56 pm #
“When the economy is bad (think 2008), then advertising is the first to be cut”
Wrong, wrong and wrong. Advertising is never the first thing to be cut. Advertisers just figure out more creative ways to get their information in front of people. The whole purpose of advertising is to get a product in front of people so that people want to and will purchase a particular product. Do you think that just because the economy is bad that people stop wanting things? People are crazy. They will spend their money on things when they have bills due because it makes them ‘feel good’. Advertising is about capitalizing on that feeling and attaching it to a product. Online advertising is not going to stop simply because the advertising model lends itself so well to the Internet.
As for the open source argument, he is not really thinking about the full picture. Think about Netscape. Netscape used to charge for its browser. That limited the amount of people who were going to use it simply because there were people who were NOT going to buy it. A lot did, but a lot didn’t. Then what happened. Microsoft said ok we are going to give it away for free. Netscape didn’t flinch. They continued to offer their browser at a price. Then they lowered the price. Then they realized what a huge mistake they had made but it was too late. Microsoft virtually wiped Netscape off of the map little by little using “free stuff”.
Open source does a lot of good and it enables innovation because people understand that this innovation benefits the whole. Then what happens? Someone makes a decision to start charging for something that was open source and then the process of free-pay-free-pay starts all over again. History is cyclical in nature and if there is one thing that we have seen, its that the free thing comes, someone capitalizes on it in a big way and then it goes and then it comes right back with a different piece of software.
Andrew started a controversial post, but his mental process, in my opinion, was a little flawed. Just remember that at one point, the program that was Windows was also free. Bill Gates decided to use the code and start charging for it. Look at how that turned out.
robojiannis responded on 19 Jan 2008 at 10:29 am #
@Killa
You say about open source: Someone makes a decision to start charging for something that was open source and then the process of free-pay-free-pay starts all over again.
This is an exception of the rule. There is also a distinction we should make. Open source software allow everyone to do what he wants with them. Free software come with a license; most times you’re allowed to redistribute the software but not change the license. So the software remains free.
When was windows free?
Kila Morton responded on 02 Mar 2008 at 9:58 pm #
robojiannis - I never said Windows was free. Do you remember the initial browser issue between Netscape and Microsoft? Read what I said. Netscape used to charge for their browser. Microsoft created IE and started giving it away for free and kicked Netscape right off of their pedestal. I was talking about IE - not Windows.
As for the open source software remains free idea - that’s a good theory. The truth is that it doesn’t work out that way. Someone gets their hands on the open source software and then changes it and makes it a pay to play product. It happens all of the time.
robojiannis responded on 02 Mar 2008 at 10:53 pm #
@Kila
My bad…
Indeed IE was free, but there was a catch (the United States vs. Microsoft case).
I agree with you, that open source software are very often transformed in commercial software.
But there is a distinction between open source and free software.
Open source are open for everybody to read, change and use.
Free software come with a license. Although commercial usage of free software is possible, the code must always remain open.