Guest Post by Amrit Pal
Most web assets from the likes of Facebook, Twitter, Google, Tumblr, Foursquare and a gazillion others appear to be free, opening floodgates of content, ranging from the genius of Wikipedia/Ushahidi to the apparently innocuous LOLcats.
The shelf life of tweets, status updates, YouTube videos and, hence, their footprints on the public memory, is dropping by the second.
While the repercussion of such an open and free culture invites a discussion in itself, let’s talk about in the context of the startup ambience.
To begin with, let us do away with presumptions of terms like “free” and “open.”
With “free,” we imply Freedom at almost a Zero price. Let’s not confuse this with “freebies” or “giveaways.” With “openness” (coders, rejoice!) we imply an Open Source culture, where the ratio of creators to consumers is shooting up faster than ever.
Fifty years ago, when content producers were a privileged club, the ratio was probably 1:10 million. Now, with the barriers lifted, a swamp of creators are competing the bigwigs, creating a culture with 1,000 broadcasters for 10 million listeners. The ratio is only poised to rise with time.
The revolution lies in shattering barriers, enabling just about anyone to showcase ideas.
So when we talk about the number of blogs trebling in the last two years and over a billion tweets per day being transmitted, we begin to see a much wider picture. And, as with all cultural shifts, economic shifts are inevitable.
Incredible, isn’t it? At almost zero cost, an individual can change the world. The only part of the process being short-circuited is the mobilization process.
Image: Loius Volant on Flickr, Creative Commons
Apparently all this is free, isn’t it?
No, not really.
We are too trapped in dollars, rupees and Euros as forms of currencies to understand the shift. The new currency of the Web, as Seth Godin calls it, is the attention economy.
When we spend our attention in creating a new blog post, making it public on the Web and, thereby, allowing it to be indexed by Google’s search engine, we are giving Google the opportunity to know understand us better. The more content we post, the better we allow ourselves to be understood and, eventually, be guinea pigs for Google Ads.
As someone put it very succinctly, “If you are being given something for free, you aren’t the consumer but the product itself.”
It doesn’t take a lot of effort to understand why Facebook is valued at $80 billion when its only source of revenue is through ads and certain apps. Its value lies in capturing attention, to hold and consolidate on that attention and then connecting people via context.
It’s incredibly abstract in its current form but it’s exciting to observe how these massive platforms convert users into real value (value = money, utility, social impact, happiness, creative satisfaction).
The repercussions of “free” extend to music, books and authors. When did we last purchase any music, forget about downloading it legally?
Imagine the reduction in popularity of niche bands if there were no torrents or piracy. An age of artificial scarcity is being replaced by digital replication where great ideas (ideas = music, books, movies) spread faster, leapfrogging any boundaries.
Are we going to be even more restrictive or look for new goldmines?
Turns out either way, piracy cannot be curbed. So why not create new business models instead of sales from records?
Radiohead is doing it, repeatedly, by letting users download their albums for free but charging for experiences that are still rare. People cherish attending concerts as much as they did 50 years ago and that isn’t going to change.
So why not achieve the maximum footprint for your music and incite people to pay for your concert?
This is precisely the freemium (free + premium) business model of the future. Rare experiences are costlier, with the easily-available albums being giveaways. There exist a million analogies when it comes to publishing (give away your blog, charge for consulting), SaaS (Ads upto X number of users, premium charges for no-ads for X+1 users) and so on.
By removing the easily-populated commodities, “free” has shattered all barriers to entry. And ironically, it has made it tougher to be remarkable. It’s easier than ever to have a blog or a Twitter feed, but not nearly as easy to generate a $1,000 contract.
In the long run, it could be fatal to let the charm of “free”prevent us from creating real stuff that matters. But when we do that, there will always be enough people who notice.
It’s easier than ever to stand up. It’s harder than ever to stand out.
Amrit Pal is an undergraduate engineering student at BITS Pilani in Goa, India and a researcher in Bottom of the Pyramid sector. When not building startups, he loves bickering on Design and Typography here.