furtherandfaster

More on Free - Seth Godin steps in

With reference to my post yesterday on the subject of Free - here's Seth Godin stepping in to take sides. You can read it for yourselves. He adds the delicious point that if you really want to find out what Chris Anderson is saying about everything is going free then you have to buy his book. Um. Yup.

I want to unpick a couple of aspects of this very fat word FREE. Because I strongly suspect it is being used in different ways and people are talking at crosspurposes.

Free is a promotional tool. It is a tipover offer. Where something which has a perceived market value suddenly costs me nothing.  In which circumstances a lot of people (but by no means all) will accept the offer.  But this aspect of free is linked to the psychological reward of getting something for nothing. The value doesn't necessarily extend beyond the transaction. If I offer you a free book, you will probably say yes. But it doesn't mean you will read it. All the arguments about getting attention ought to be arguments about getting people to do something with what they are being offered. It is pointless offering whitepapers which get accepted but never read. At one point one of my published articles was being downloaded from my site 200 times a month for a couple of years. The alternative was being a subscriber to WARC where it was avaialable. So it was a freebie. But I don't believe all of those who downloaded the article ever got around to reading it.

The reason why I read Gladwell's review of Anderson's book was not because I was trying to avoid reading the book. It was to find out if the book was worth reading. If Gladwell tried to charge for the review then he wouldn't get many takers. But unless some people were willing to go and buy the book there's not a lot of point in writing the review. Someone has got to want to spend some money somewhere. But we can kid ourselves with the tipover version of free that there has been great takeup. Buy one get one free offers are problematic because the retailer wants high stock turnover but doesn't have to worry about whether the product gets used. The manufacturer does. The feeding frenzy of the free offer is all about shopping not using.

The second aspect of free I want to reference is about processes. I don't pay to search Google so the answers appear to be free. Though in reality they are paid for by advertisers - even the free listings.  Amazon let me read the first chapter sometimes but they don't let me read their titles online as an alternative to buying them.  we are strongly habit forming as a species because we are mostly too busy to set up spontanesous processes. I could find an old paper pad round the house or get one off a friend for free. I could go up to the woods nearby and collect firewood. I pay for the convenience of having somebody provide these things because I can't be bothered to do it myself. It seems to me there is a fast track and slow track. If you want to get something done fast then pay for it. Otherwise the price drops. The big problem at present is that so much content is available for free that we may decide to stop paying for anything. Which is taking the slow option. What is needed is new processes which are easy for the customer to participate in which make clear how the content is funded and who is paying for it.  Youtube needs a process by which it gets paid and we still get the content we want off it. Charging me $0.25 per use is an unusable way of getting the funding. Charging me $5 a week may be better but not much better.

Direct Debit has worked fantastically well at getting large amounts of money out of people which they can switch off anytime they wish but making it a hassle to set up and not impulsive to switch if off. Direct Debit is a process for getting payment which the customer accepts and finds cheaper than the alternatives - paying cash for each issue of a magazine for instance. 

The word Techno-utopian is been bandied around. And for good reason. There is more than a whiff that everything ought to be free. Or that changing the business model is in itself progressive. So good. At the other extreme there are others who thing that anything free must be stolen or rubbish.  We need to keep moralising away from the free issue. It isn't helpful.

state of play - JG under the kibosh

Just to clear up any confusion of the last few days. There are bound to be rumours and having lots of different social media channels doesn't help. I had planned to fly to Romania today to run 3 days of training which were postponed from last week when I had the emergency operation.

I went for a medical checkup yesterday and to keep it simple. They won't let me get on a plane this week. Really disappointing - I'm very sorry. I feel bad for letting people down but was warned by the medical people that if I don't take it easy now that I could risk health problems and a much longer convalescense.

So here's what is on the job sheet at present.
The doctor has said that as long as I take it easy and behave myself that it is OK for me to fly to Romania next Wednesday to participate in the IQ ads conference.

I shall also be running a research project -in the UK focus groups eh? Sitting and talking to people ;-)
So still active but not necessarily on my feet for long periods.

I am in the process of rescheduling the lost training days for Septemeber. When I am next back in Romania to speak at an The RODirect conference on Sept 9th. The plan is to run them then when I expect to be back to my usual stamina levels. These include the Advertising School for the IAA, account planning training, and a course about running internet research.

 

Free: The sting in the long tail - or Anderson versus Gladwin

A terrific war of words has started up which anyone with the least interest in the future of media (whether advertising or what the advertising pays for) should pay attention to.

Chris Anderson, author of The Long Tail has a new book out entitled Free which in a nutshell says that the price of originating and distributing content is falling towards zero. When things are free people behave differently - a lot more get involved for starters. Free is one of the most powerful words a marketer can use. Therefore he argues we need to develop new business models to make money out of the bit which we can no longer charge for.

Malcolm Gladwell author of the Tipping Point and Blink among others is a journalist. Whose livelihood is directly threatened by the idea that whatever he writes has zero value and has to be given away, so he has to recoup some other way.  Part of Anderson's response is an ad hominem argument that his professional reviewers are being paid to review him so are of course going to be hostile to their very future as professional writers. Which kind of stirs things up a bit - not very helpfully. Gladwell's argument is that what Anderson is proposing is nonsensical. If you can't make money providing something then a lot of commercial providers are going to stop providing it. Even aggregating vast audiences is pointless if in the end you lose money. As Youtube has done through its entire life.

This is Gladwell's review of Free. Which by the way you can read for free. Something Anderson points out.

And this is Anderson responding to Gladwell. Specifically on the issue of whether you need journalists or community managers who find good writers who will do it for nothing. 

What Anderson doesn't respond to is Gladwell's challenge to his quoting of Levi Strauss from early in the 20th century when we were promised free electricity. That's what nuclear power offered. What  Levi Strauss didn't factor in was infrastructure. It costs quite a lot to build and maintain a national distribution network. Which is what your electricity bill largely takes account of. The point is that free power has not meant zero electricity bills. Nor have free roads eliminated the need for road tax (or road metering). And free universal healthcare has not meant that nobody has to pay for it. We are charged in other ways.

This is probably the central debate in business. Want lots of customers? Give it away. Want to make money? Sell your business to someone who thinks they can make money out of all those people. Want to run a sustainable business which doesn't cost your customers anything? Well we're still working on it.
Based on the revenue Apple are making from the appstore they could give the Iphone away. Based on the Star Wars merchandise that Spielberg sold he could afford to give away the cinema tickets for nothing. There are 2 opposing questions. Why should my customers pay for anything? And why shouldn't a business make as much money as it can?  Apple are making money from handsets and from content. It is now possible to reshape the value chain in such a way that chunks can be given away. But it can't all be given away. Otherwise there will be no business to run.

Giving a moral impetus to the notion that if something can be free that it OUGHT to be seems to me to be thoroughly peculiar. Isn't that what got us into our present environmental crisis. Because there was no one there to price environmental degredation out of reach - companies and nations simply helped themselves.

The trouble with free is that it makes contracts pointless. I get offered lots of free stuff. And of course I say yes. But strangely enough if I have enough freebies around it doesn't put me under any obligation to consume/use what I have been given for nothing. If I have had to pay for something I am more likely to use it because it has cost me. If it fails to perform I ask for restitution/repair of some kind. The price of content is falling towards zero. Which means we are either sitting around like kings with unimaginable wealth (true) or we are sitting around in a junkyard full of stuff that we don't have time to look at, which we are unable to evaluate and prioritise (also true).

There's a story about the city of Babylon which was so wealthy that it was reguarly attacked and taken. But the invaders found the wealth was too heavy to carry away so they just sat on top of it until the next lot of invaders arrived. We need a better driver than free - Something you get a return from. Free isn't enough. Free is junk.  

Anderson is going to be speaking at the RSA tonight in case any of you are a) in range and b) lucky enough to get in.  This one is going to run and run. And run!

Verbatim.. overheard in hospital last week

1st speaker : I've had a run of bad luck with my health.

Twenty years ago I had a car crash, really bad, went into the tunnel and everything. But they brought me back. My eyes were bandaged but I just knew I had lost an eye.

Then last year I got bit by a dog. A Staff (staffordshire bull terrier) bit me in the ear and I got a blood glot there the size of my fist. It was while I was rolling on the ground and the dog was biting me that I felt the crackhead's knife go right into my neck and out the other side. That was touch and go.

And then I hit this bloke at a club last Saturday and now my hand has got poisoned and its spreading down my fingers and up my arm so my doctor sent me in to get it looked at.

pause of several seconds which the listeners digest this catalogue

2nd speaker: Mate you've obviously been put on earth for a reason because there's no other way you'd still be on it.
  
 

Choice... is a good thing. (that's less choice)

POPAI briefing pointed to a Wall Street Journal article about how Wallmart and other major US retailers are reducing the number of lines on offer by up to 15%. The number of grocery lines in the US got to 48,000 in 2008 which is ludicrous. The reason for the proliferation of so-called choice was that it gave the retailers bargaining power to drive their supplier costs down it wasn't for the customers' benefit. But the result of having to much to choose from is the need for more education more signage - and it makes purchasing more complicated and eventually slower. Customers make mistakes and don't necessarily clutter up customer service by demanding refunds. All that has come from the economy of more than enough. Now we have entered the economy of making do. And retailers will be slashing their inventory because it increases the risk of writedowns, outofstocks and clutter which they can't pass back to suppliers.

So here's the top tip as we enter the second half of 2009 when media companies are running out of scares to hit us with to try to boost circulations, and politicians are spending less time making reassuring noises because they're rumbled and they haven't got any more idea than we do about how the next 2 years is going to play out (except that it still looks rather like the Great Depression - all over again). 

MAKE DO. Simplify. Buy things you believe will continue to be available whose quality you trust- because you already made the investment in checking. Don't waste time looking for bargains because no one has been manufacturing surpluses, the stockrooms are being run down so there really aren't a lot of bargains out there - just products which you are welcome to haggle over if you think you can put pressure on retailers/manufacturers' fears about cashflow. But whatever else you do start adjusting to a way of life that doesn't involve proliferation and may not do so for many years.

A different kind of labyrinth

Stuck in my bed all day Sunday I was reminded of the fingerprint labyrinth which Maggie Dawn linked to last week. Labyrinths became very fashionable fin de siecle (1999) and were reconstructed in various cathedrals and festivals as an aid to prayer. The big 'un is in Chartres Cathedral, dates from 1200 and is laid into the floor.  Basically you walk to the centre of the labyrinth reflectively - and then walk out again. Using a fingerprint is a great update and  moves away from tendencies to pomp and theatricality.Its a funny time at the moment. Our public spaces are up for renegotiation. But so are our private spaces too. Enjoy. 

Music and the art of listening

There was a full blown row in our household about whether Michael Jackson was Mozart. Or Beethoven. Or neither. And whether it would have been a news story if he hadn't just sold three quarters of a million tickets at the O2. So what better way to pour oil on troubled waters than to have Evelyn Glennie talk about music at TED? And silence us all. Thanks to solobass Steve Lawson for this link.

I love the way she takes the freak aspect of being a deaf musician full on to claim that deaf musicians are changing the way we think about sound. Just brilliant. Pin back your ears - if you need them.

Better to be nice than talented

a musician reflects on MJ and global stardom- Steve Lawson blogs

brief apology

By now I was expecting to be running training in Romania. What got in the way was discovering rather at the last minute that my gall bladder was a liability so I spent much of the week in hospital. I shall now attempt something of a thematic backfill since wifi and broadband are still not considered as part of patient support. I'm now out of hospital with lots of keyholes recuperating at home.

The escape committee

4 of us in a ward with 6 beds. Of similar age. With jobs and homes and families. There was a plasterer with a suspected stroke. A commercial gasfitter with a shattered pelvis who had fallen off the roof of his thatched cottage. A bus mechanic with a hernia. And me with (and without) my gall bladder. We formed an immediate support group. I'm still wondering why it was so easy to do so - being very different people. Each of us had a separate family support group - each with a different style of support. But the visitors for each patient on the whole interacted with the other patients as well. I was offered food to be brought from home and a charger for the mobile. I hadn't expected that level of warmth and generosity. And it was all the more welcome coming at a difficult time.  We all managed to escape on the same day as well. Which was nice.