Timothy Taylor, who Brad DeLong describes as the best intro economics teacher he knows has a new basic econ textbook out. And it's available for free!
The publisher, Freeload Press, will earn revenue by selling advertising on the website where the book is distributed. Also, when you download chapters (as PDF files), the first couple of pages might be advertisements. There is a short registration form, but downloads are free. If someone wants an advertising-free, black-and-white paper copy, it's available for $30 at the website ($20 for a micro or a macro split). There will soon be a workbook up on the website to accompany the text, and a test bank is already available for instructors. The website for Freeload Press is http://www.freeloadpress.com.
Is an advertising supported approach a sustainable business model for a textbook company?
I kind of suspect that it may not. On the other hand, as a K-12 endeavor I think things like the California Open Source Textbook Project have a lot of promise. As they observe, "California currently spends more than $400M annually — and rising — for K-12 textbooks" and of course California's not the only state in the country. If any substantial chunk of national K-12 textbook spending by public institutions could be redirected toward open source textbooks, I think you'd do a lot of good.