The end of the free lunch - again

http://www.economist.com/opinion/displaystory.cfm?story_id=13326158

by mixmax • 17 years ago

31 14 17 years ago

9oliYQjP• 17 years ago

What worries me about this trend is that I don't think the free lunch can end without websites/services getting in bed with the ISPs. Having to deal with hundreds of subscriptions to websites/services is just not going to fly with your average consumer. I highly suspect what will happen is that your ISP will negotiate with websites/services and offer up bundled tiered Internet packages like they do with cable TV. Should that prove to be successful, that will mean the end of the world wide web as we know it. Then again, that may not be saying much as the world wide web as I know it today is not the same one that I knew even 5 years ago.

harshavr• 17 years ago

Is it necessary for the agent managing the subscriptions to be the same as the agent providing you internet services? Maybe you can have a webapp which provides an easy interface to both users and website owners. Website owners provide usage info & bills, and users see all charge details in one place. Something like what credit card companies do but also managing any extra details specific to websites.

ntyntyesr• 17 years ago

Which means you wouldn't be reading this story - The Economist is owned by the FT, which competes with the Times, which is owned by Murdoch. If you internet is from Sky then they aren't going to be shipping a competitors content over their fibres.

AOL your time has finally come!

karl11• 17 years ago

This already happens with ESPN 360. I can access it on campus, but can't when I walk home to my Time Warner connection, apparently because Time Warner has not negotiated with ESPN to provide it.

yters• 17 years ago

It's a good argument and all, whether it's made by Matt or the economist. But, why does everyone focus on money? Is wealth relevant or not? Surely giving away free stuff creates more wealth, if it is sustainable. The real answer to this dilemma is to somehow redirect the outflow of wealth partially back to the producer without the use of money.

For example, say you created free, online computer games where people spent all day reconfiguring proteins. The game is completely free, thus providing wealth to people, and people pay the service back by using it.

The only reason money is ever mentioned is because it is the simplest, catch all solution. But, like the no free lunch theorem for search, money is your Monte Carlo baseline. For a limited problem domain there is quite likely a better technique than random sampling, and therefore a better wealth redirection technique than money. People just need to be more creative. (And, perhaps the comp sci analogy is more than just an analogy)

swombat• 17 years ago

Very interesting idea.

I've just finished reading Accelerando by Charles Stross, and one of the characters there is what he calls an "agalmic entrepreneur". He doesn't actually start businesses himself, just has half a dozen brilliant ideas before breakfast, finds the right person to implement those ideas and gives that person the idea (and the crucially missing connections to make it happen, etc). In that novel, he has no money - lives off of favours that he can call in at any time from the numerous people he's made rich.

Now, that's obviously not very realistic, but perhaps a mix between those two ideas might bear fruits.

jwilliams• 17 years ago

There was a good article around called something like "the well that Google built"... (Ironically I can't find it on Google).

But the basic idea is like building a village well. The rich people of the village may band together and build a well - naturally, they don't make money off it, as the general populace would be too poor to pay.

What happens is that the prosperity of the whole village increases. Disease goes down, productivity goes up - so the demand for what the richer inhabitants have to offer (e.g. goods & services) goes up.

The Internet is all about this - Google isn't the only example, but is a prime one. Whilst many of their services do not directly make any money, they make the Internet a more useful, better place... And the more that people turn to the Internet, the better off Google is.

Edit: pg touches on this too, with his comment about a startup tackling an issue like malaria: http://www.paulgraham.com/good.html Curing malaria isn't going to immediately/directly make anyone any money - but it's possible the downstream effects could generate a lot of wealth.

briansmith• 17 years ago

Hosting companies, grocery stores, and landlords only accept money as payment. That is the main reason.

Google already does what you are hinting at: they give away free services and then harvest the input from that usage to make their services better. However, at the end of the day, Google has significant expensive that need to be paid in "real" money.

davidw• 17 years ago

It is, of course, worth noting, that The Economist's on line edition has gotten gradually more and more free, with time.

andrewljohnson• 17 years ago

I keep reading these articles, but I'm still making a free website.

In my estimation, the big internet sites serve everyone, not just the chosen few with money. And I want to build a big internet site.

So it must be free.

dbul• 17 years ago

Building a big Internet site and providing the service for free is great. It isn't impossible to do that and be successful. But why not have services that users pay for in addition to the free content? Surely there are some services where users who are getting what they need for free wouldn't be concerned with and likewise there are people who are willing to pay for "something more."

jimbokun• 17 years ago

Why do you want to build a big internet site?

ewjordan• 17 years ago

With all the talk of advertising "crashing" (I've heard a lot of these claims lately), I'd really like to see some numbers to back it all up and prove the point.

Are advertising revenues down significantly more than, say, the Dow average? Because otherwise I would have a real hard time agreeing with the assessment that another advertising bubble is popping...

The problem with a switch to paid content is, of course, that it makes very little sense to assume that the customers that you want to pay you or what they're used to getting for free are any better off financially than you are, or any more willing to pay for the content than advertisers are willing to pay for eyeballs.

However "unproven" the advertising business model on the web may be, the user-pays-for-content model has even fewer success stories - I'm getting a little tired of people claiming that it's the clear way of the future when just about nobody has made it work yet.

metalacorn• 17 years ago

from what i am reading it seems you can either be 'free' or 'not-free'. in my opinion there is nothing wrong with free, it's doing 'free' for ever that I think brings about the contention. giving stuff away for free catalyzes a conversation with the consumer that you might not have had in the first place if you had charged. This falls in line with the article discussed in http://news.ycombinator.com/item?id=523616.

Given these numerous interactions with your free product - build a perfect product and know that it is exactly what people are looking for. Make that 'not-free'.

The end of the free lunch - again

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