This Blog Post Is Available At No Charge!

[Tim Lee]

Alan Jacobs, blogging at the American Scene, (where I'm also a sometime contributor) wasn't impressed by Mike Masnick's post on "free"-based business models. I find Alan's post a little bit ironic because I'm pretty sure that (unless Reihan is playing favorites among American Scene bloggers) he didn't get paid to write his post. His post was titled "MY WRITING DOESN'T WANT TO BE FREE," but I was still able to read it without paying for the privilege. Something doesn't compute there. Anyway, Alan says:

When Poole points out — in response to the surprisingly common argument that bands, say, can give away their records for free and make money with live shows and t-shirt sales — that computer programmers don't program for free and sell mousepads on the side, Masnick replies, serenely, that that comparison doesn't apply because programmers get salaries. Well, precisely. But rock musicians don't. Freelance writers don't. This is Poole's point, and David Pogue's too. They write for a living, so if they make their writing available for free, how do they pay the bills?

I think the problem here is one part miscommunication, and one part failure of imagination. In point of fact, some programmers do give away their code (in the form of contributing to free software projects) and sell goodies (in the form of setup and support services for that software) on the side. Of course, most of the time, these business models are pursued not by individuals, but by firms. As I pointed out on Monday, this is the business model of several software firms, including Red Hat and MySQL. But the essential point is the same: giving away your "main" product as a way of selling complementary products is a perfectly viable way to make money.

Of course, the individual programmers in such companies get salaries, but that objection confuses free content with free labor. Content, once produced, can be produced infinitely at near-zero cost; Red Hat and MySQL can give copies of their operating system and database, respectively, to anyone who wants them at near-zero cost. In contrast, labor is and always will be scarce. Obviously, it would be insane to suggest that writers, musicians, programmers, and other creative professionals should provide their labor for free. As a freelance writer and sometime programmer, I would object to that as loudly as anyone. But on the other hand, virtually all the content I produce is given away for free, supported in some cases by advertising or other publicity-based business models and in other cases by charitable contributions. I and the organizations I work for "make my writing available for free," yet so far I've been able to "pay the bills." Amazing how that works.

Now, Alan wants to know how David Pogue could make a profit off of his book. My guess is that Pogue dramatically overestimates the negative effect releasing an electronic version of his book would have on sales of the paper book, and that he ignores the possibility that an electronic version might even spark additional interest among some readers in the paper copy. I have purchased several paper books that had free online editions simply because the paper book is more convenient for curling up with on the couch.

But in a sense this is beside the point. As competition in the market for information goods continues to increase, more and more creative professionals are going to find that their competitors are releasing works for free, supported by sales of ads, concert tickets, consulting service, or other complementary goods. The transition to "free"-based business models is virtually complete for news and opinion and it's becoming increasingly common with music and software. (And of course television and radio have operated on this model for decades) I'm not going to predict when it's likely to happen with books, or what the book-based business models of the future will be, but the point is that if it does happen, no one is going to keep buying David Pogue's books simply so he can continue feeding his family.

If you can figure out a free-based business model for your creative works, it's a huge competitive advantage, because it's much easier to reach a larger audience if you don't ask people to pay. That's why we've seen a steady drumbeat of failed paywall-based business models in the newspaper business. Evidently Pogue hasn't figured out a business model that will allow him to make money while giving away his manuals, and that's fine. Maybe none exist. But Pogue's lack of creativity isn't evidence that no one else will figure something out. And it certainly doesn't prove that "free"-based business models in general are doomed to failure.

Photo courtesy Paul Keleher