‘Free’ Response

“There’s no such thing as a free lunch.” or so the saying goes. But in Chris Anderson’s book, Free, he talks about the revolutionary new business model of using ‘free’ products to still make incredible profit. A strategy that web giants, such as Google, have employed to find great success.

Earlier, I had posted some questions that came to my head as I explored the ideas of Anderson. In response to those questions, I came up with the following:

1.) Why is it that many newspapers are still struggling with the idea of a free online edition when the main reason they are trouble is because they refused to evolve and adapt in the first place.

When I heard that a well-respected paper like the Boston Globe was switching from a free online edition to paid online edition, I was perplexed. It is common knowledge that newspapers have suffered the most in response to new advancements in communications technology but the rise of the internet was arguably the nail in the coffin. As stubborn news organizations clung to the traditional business model, they complained about reliability of internet news, amateur reporters, and end of “the good old days.”

However, many papers, like the New York Times, have since wised up and come up with new solutions such as beefing up their online editions with multimedia and content, and becoming news leaders online like they were in print. They have found that they cannot charge for these online editions because people will just use other free news sites so instead they have implemented new ad placement ideas and are beginning to get the idea that Anderson is preaching.

It seems strange to me that some papers, especially well-respected ones like the Boston Globe, still don’t get it. They have delusions that many people will have no problem paying for an online edition just like they did for the printed copies. But we have seen time and time again that this is not true. Unless the Globe implements some new business model when dealing with its site, people will go elsewhere. They need to utilize the idea of free content to attract a loyal following of readers who see them as a premium news source and will become reliable audience for online advertising.

2.)What kinds of things can sites like Twitter do to increase their profits? Obviously they would lose many users if they charged for accounts but is online advertising the key to keeping sites afloat?

Social networking sites like Twitter can obviously not charge people for its services because they will lose a large amount of users who do not see it as a crucial part of their life. However, Facebook has proved that by practicing Anderson’s ideas about providing ‘free’ products they still find great success. Twitter has tried to implement sponsored tweets but these are often met with hostility because people don’t like to have their news feeds broken up by commercials.

However, there are still ways to monetize the site without directly charging for the product. I have seen companies use popular celebrity “tweeters” to casually mention their products. Also, twitter can offer premium ad-ons such as desktop Twitter apps for small fees. The key to adapting a ‘free’ business model is to think outside of the box. It seems that, so far, they are on the right track.

Tags: anderson, Chris Anderson, free