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Monday, November 05, 2007

Free is complicated

Tim O'Reilly, "Free is more complicated than you think", O'Reilly Radar, November 2, 2007.  Excerpt:

Peter Brantley sent a link to a great summary of Scott Adams' nuanced discussion of the tradeoffs in making Dilbert freely available on the web. The punchline: "Free is more complicated than you think."

Adams reports that putting Dilbert online for free

"gave a huge boost to the newspaper sales and licensing. The ad income was good too. Giving away the Dilbert comic for free continues to work well, although it cannibalizes my reprint book sales to some extent, and a fast-growing percentage of readers bypass the online ads with widgets, unauthorized RSS feeds and other workarounds."

This sense of tradeoffs in making content freely available is consistent with our experience at O'Reilly. We find that making a book freely available can help visibility and sales of a book on a little-known topic, but for a well-known topic or author, who benefits little from the additional exposure (like Scott Adams), it can have a slight cannibalization effect on print sales. So, as a beginning science fiction author, Cory Doctorow used "free" to build his career, while Stephen King found the results of his experiments with free to be disappointing. (I explored these tradeoffs in my article Piracy is Progressive Taxation.)

The point is that we need more than one model....

There's another class of tradeoffs in a move to an advertising-based model for funding content creation: readers are expected to give up their privacy. Marc Hedlund wrote about this recently: Infiltrating the Privacy Movement.

This was the subject of a dinner conversation I had with Rupert Murdoch at the Web 2.0 Summit (before his on-stage appearance). We talked about the tradeoffs in making the Wall Street Journal free online. It's quite clear to me that when Murdoch's purchase of the Journal is completed, the paywall will come down. He sees the Journal readers as among the most valuable advertising targets in the world. But more than that, he sees a future in which he'll be able to make those readers even more valuable by carefully and completely tracking what they actually read in the Journal.

These privacy tradeoffs are going to become even more widespread as advertising becomes the dominant model. How much would you let an advertiser know about you in exchange for their free content? How much would you pay to avoid having them know that about you?

As Scott Adams said, "Free is more complicated than you think."

Comment.  All the examples in O'Reilly's post are free editions of works that also have priced editions.  Free may be complicated, but no one should be surprised that dual editions are complicated.