Free! Why $0.00 Is the Future of Business
 

http://link.brightcove.com/services/...tid=1813637601

Interesting stuff :pimp

I like the thought the problem for me is the author is a cheap theif check out http://www.fastcompany.com for an article showing how he ripped his book off of wikipedia.

Must be time for the monthly post on the, "the internet should be free", shtick by some blah blah with a light bulb over his head, or behind him.

The web already tried this in the late 90's early 2000's. It did not work then, and it will not work 10 years later, nor 10 years from now when this comes up again.

Some people need to open a history book.

:2 cents:

HAHAHA I love his example, "google is most successful company and everythign it does is free". little bit simplified there dumbass

Edit: I'll hit you up

Yeah actually i read that last night on a blog, it's a shame because he also wrote the book the "Long Tail" which was a pretty big hit from what i understand? I'm going to download the Long Tail audiobook tonite (and pay for it LOL!)

free drives a lot of traffic and the people that can make that model connect with the costs are the kings.

google se
gmail
pornhub

or the hope is the technology is gets there or enough innovation to connect

Strange, I give everything away on my network and yet I still make money... go figure.

:1orglaugh wow

Google is free to USE, but they make their money from advertising. This seems to be the way a lot of sites are moving towards now. 2-3 years ago I was making $10+ CPM on a b2b site, now it pays like $3 CPM.

More people are finding this trend and killing the revenue for larger sites who's traffic is actually viable, and advertisers are paying less because the traffic is converting at a much lower rate. I met with a guy a few months ago who had 50+ sites that he was driving traffic to and just selling ad space on a CPM basis. More and more people are becoming the middle man between the middle man :1orglaugh

Check him on that too i liked it but i think its a little bit at odds with his current theories. I like "Meatball Sundae" by seth godin and "blink" by Malcolm Gladwell in terms of things you can take from them to change your thoughts on your business.

yup good idea! I'm going to lower my prices to $0.00 right now! :1orglaugh NOT!

Free submit passes! Free banner spots! Free gallery spots!

It's all free already!!! Just give us your credit card for "age verification" purposes. ;-)

:1orglaugh :1orglaugh :thumbsup

I guess he missed the article write by the owner of Plenty of fish" whom essentially said free sucks.

Traffic alone is not sales.

See Facebook, MySpace, YouTube among countless other social networks trying to break even, or having trouble with their ad models not converting into sales for advertisers. It has been well written about for some time.

Enough said.
:2 cents:

I guess the grass is always greener on the other side ;-)

Check out this article

http://www.wired.com/techbiz/it/maga...f_facebookwall

i think he's doing ok for himself.

internet is not for free

That guys has actually had some interesting interviews. I have heard him on ShoeBitch's show, as well he has been in a few magazines. He has some new concepts, or ideas on a lot of things online, including dating.

However, what he's been saying for years has yet to come out as predicted. Dating is still a big money maker.

That said, and kinda taking a step back. There is not going to be any hard fast rule for the net on EVERYTHING should be free. Nor will there be any 'across the board' sweeping generalization. Online, like any business, does not work that way.

We see it now in online adult. Most mainstream porn sites are going to have to learn to offer more value or drop their price points or new technology because there is such an insane glut of content. However, niche providers can still command a premium on their content and sites.

That is just one, of endless, examples where there is never going to be one hard rule for everyone and everything online or off. Yet every month some new dude comes out with an article like the O.P.'s link citing the same shit from the guys before, or from last year, or 10 years ago.

Have already read it.

I have also read a lot of mainstream boards that talk about how social network sites offer branding, and high traffic but few sales or conversions.

I am in this business for sales champ. Not for non-buying clicks. It is the same reason I do not advertise on mainstream hardcore porn sites. While they can get me a million impressions a day. Most of those people are not going to buy my softcore fetish wares.

Business is about sales. Not about Alexa and traffic e-penis.

How many people are on this board daily, with killer traffic and alexa rankings and yet still converting at 1:1000, 1:10,000 or when from $2000 a day to $200 a day? Yeah, guess all that traffic is really paying off for them right?

These threads are on this very board daily. Yet people still want to play that traffic epenis horn? As I said previously. There is not 'absolute' business model. However, this board alone has easily proven traffic, and free, is not king.

i think this is relevant here

what this board has also learned is that if your trying to sell something that somebody else is offering for free, its harder to sell

everything else equal, humans respond to "free" and knowing that, if you can make money off of it, even the better

just because facebook is not profitable yet doesnt mean they are not doing it right, when they allowed developers to use fb to release their apps, many made a ton of money,millions even (mafiawars), fb could have figured out how to get a % of the income without bothering the users.

GFY is free to use, and you and i are on here, posting, making money off of the traffic, and gfy is likely one of the few profitable divisions playboy has

dont hate against free ;)

Not hating at all BROmance. :)

You are right. FB will get it right before the others do.

I also agree with you on the GFY/PB. :winkwink:

:thumbsup

Free = low quality in most cases.

That's sort of the problem with the internet.

If you have a good idea for something that people will actually happily pay for, some jackass will come along and offer it for free just so he can make 1% of what you could have made. Craigslist makes a few million, but he killed a near billion dollar industry to do it.

For example, giant tube sites make decent money, but other non-tube sites with the same Alexa rank are valued close to the billions. Pretty shitty business if you ask me.

Don't get me wrong, it's the way it is these days and I totally accept it, but to tout it as smart business and good business is a bit silly.

suck on a fat one

I still like to put a little credo in the old adage - you get what you pay for.

I look around at the freebie content in our fetish niche market (talking still pics here)...and the vast majority of it is regurgitated, moldy shit from years gone by.

Some folks are still willing to shell out for the newer, unique quality stuff.

"Gift" economy? People working for free??

Pffff... Yeah, right.... Looks like that editor read quite a lot of Marx....

Amen toe dat shit.

great post, well said

Yeah but these things are irrelevant. The market was headed there anyways, and if it hadn't been Craigslist it would have been someone else.

Being pissed off at these people is a waste of time, crying for what used to be or might have been is a waste of time. Spend your time trying to figure out where things are going, and be there waiting for it to show up.

Do we cry about how many bank teller jobs were lost because of ATMs? How many clock and watch repairmen were put out of business by digital timepieces? How many blacksmiths went out of business when people traded their horses for cars?

Do AT&T executives sit around and cry about the days when they could charge $1 per minute for international calls? That's something that people can do today, over the internet, for free, but AT&T is still in business, because it evolved.

To beat a dead horse, "adapt or die", is just the way it is.

Another good article on the topic:
http://www.wired.com/techbiz/it/magazine/16-03/ff_free
:thumbsup

I never cried about it. I wrote that's just how it is and I accept it.

Anyway, the examples you used were based on new technology phasing out older technology which is not really an apt analogy. The computer replacing the typewriter is not the same as someone giving away hundreds of thousands of dollars worth of free content so he can make a few thousand a month when before he started giving it away for free, he could have made tens of thousand a month with that same content that he has now devalued. The market didn't devalue it, the businessman did. If it's smart business these days to devalue your own product yourself, then I may need to go back to business school.

My point again in case you missed it. I accept the way it is, but to claim it's good business or smart business is pretty stupid. What these authors are actually describing is a SHRINKING economy. If the readers believe that there is more opportunity in a shrinking economy, then they need to brush up on their economics.

i want to breakfree!

The computer and typewriter aren't good analogies, which is why I didn't use that analogy.

I used an analogy of AT&T getting as much as $1 per minute for long distance calls in the past, and today people being able to make long distance calls for free. But AT&T's market cap and yearly profits are much higher today than they were back then, because they were willing to CHANGE with the times.

That's as close to a perfect analogy as there is, you just don't want to accept it. Or you say you "accept it" but you think that it's bad.
So is it bad that long distance calls don't cost $1 per minute anymore? Is it bad that banks give out free checking accounts now instead of charging $10 per month for them?

You're standing so close to the tapestry that you can only see a few strands of thread. I'd like to invite you to step back and see the whole picture. :2 cents:

Just to be clear, this is just a friendly discussion, I don't want you to think I'm trying to attack you or anything and I respect your arguments.

But as far as "accepting" it, yes I totally do and that doesn't mean I'm whining. I can say something is a bad thing and still accept it. I feel that war is a bad thing, but I still accept it as a reality. I also have defense stocks, so I can profit from it as well. Even though I think it's bad in the long run.

Same with this mad dash towards free. It's a bad thing in the long run because like I said, it causes the economy to get smaller, not larger. The examples you made in your first post leave out a critical point which actually proves my point. Yes, the blacksmith was put out of work by the auto industry, but the auto industry was hundreds of times larger than the industry it replaced, in this case the horse and carriage industry.

This is the total opposite of what is happening in this push towards free. Large industries are being replaced by tiny ones with a fraction of the value. How is that good?

As for the ATT example, the cost of long distance came down because ATT was serving pictures and videos along the same lines that just carried voice before. ATT didn't just start giving away nearly free phone service so it could make a fraction of the money it did by offering some other service instead.

Just like with the PC industry, the cost of PC parts came down but the industry itself became larger and larger. In the free economy, industries get smaller and smaller and that's the problem I have. I guess I'm just not wise enough to see how shrinking industries is good for everybody and creates opportunity and wealth. But I guess we'll all find out soon enough.

But I don't want you to think I'm one of these guys crying for the old days. I got into adult when tube sites were pretty much at their peak so I don't really know any other market environment (as far as adult goes). I've been growing pretty much since day one so I have yet to see downturn due to free content, so I don't have a grudge a personnel vendetta against free.

haven't people been hollering about this forever now?

Well here's the thing, we're still really early in the game, so nobody really knows what's going to happen.

BTW, AT&T didn't drop long distance prices because they were serving pictures and videos on the same lines. They dropped prices because MCI and Sprint did to them, what Craigslist did to newspapers.
They took a far far lower profit margin to offer the same service.

At the time, most people didn't foresee internet service or cellular service or whatever, there were just new players trying to break into the biz, and the competition and innovation that followed over the years was astounding.
Is telecommunications a larger industry today or a smaller industry today than it was when AT&T was basically the only game in town?

Now, while there is no perfect analogy, the adult internet space is going through something similar. Margins in the early days were astronomical. Not because of any great business savvy on the part of the players, but because they were the only ones there.

Now the delivery technology has improved, the costs associated with delivering the product are a fraction of what they used to be, and there are many more competitors in the marketplace.

So now, today, the winners are the consumers, and the losers are the business owners who don't innovate.
Today you can get a membership to Brazzers for $100/yr. They're offering full HD videos and have an insanely large library that's updated multiple times a day.
For $25/mo you can get a membership to Naughty America. They have a similar content library plus offer several hours per day of live interactive content for free to their members.

These products are 100 times better than what Cybererotica was charging $50 a month for 10 years ago.
Obviously, their margins are tiny compared with what sites like Cybererotica and Karasxxx made in the early days, but that's true of any maturing industry. The internet and adult internet are no different in that regard.

They won't be "smaller industries" by any stretch of the imagination, but they will be "smaller margin industries". That's just the nature of the marketplace though, it's inevitable.

I highly recommend it. Great book.
After listening to it and a couple of other things, I finally "got it", and stopped bitching about the way things were going and started working on getting ahead of the curve.

One of my favorite parts is where he talks about what the Sears catalog did for small farmers, and how it crushed the little general stores in small towns that were gouging those farmers on the price of supplies.

Very similar to what Ebay did to the jewelry and watch business.

I agree that it is still early so we will have to wait to see how it all turns out.

Yes, the ATT analogy isn't perfect. But I was trying to say that the price came down because of natural market forces, same with PC prices. Not because someone came in and offered it for free because they were happy making .001 percent of what the original providers were making.

We'll have to agree to disagree on this one as far as the long term implications. But either way it will be fun to watch everything play out.