Over the past decade, we have built a country-sized economy online where the default price is zero -- nothing, nada, zip. Digital goods -- from music and video to Wikipedia -- can be produced and distributed at virtually no marginal cost, and so, by the laws of economics, price has gone the same way, to $0.00. For the Google Generation, the Internet is the land of the free.
Which is not to say companies can't make money from nothing. Gratis can be a good business. How? Pretty simple: The minority of customers who pay subsidize the majority who do not. Sometimes that's two different sets of customers, as in the traditional media model: A few advertisers pay for content so lots of consumers can get it cheap or free. The concept isn't new, but now that same model is powering everything from photo sharing to online bingo. The last decade has seen the extension of this 'two-sided market' model far beyond media, and today it is the revenue engine for all of the biggest Web companies, from Facebook and MySpace to Google itself.
In other cases, the same digital economics have spurred entirely new business models, such as 'Freemium,' a free version supported by a paid premium version. This model uses free as a form of marketing to put the product in the hands of the maximum number of people, converting just a small fraction to paying customers. It's an inversion of the old free sample promotion: Rather than giving away one brownie to sell 99 others, you give away 99 virtual penguins to sell one virtual igloo. (Confused? Ask a child: This is the business model for the phenomenally successful Club Penguin.)
With physical stuff, samples must be doled out sparingly -- there are real costs to be paid. With bits, the free versions are too cheap to meter and can be spread far and wide. That's why so many people businesses (expensive!) are turning into software businesses (cheap!), which is why your cranky tax accountant has morphed into free TurboTax online, your stockbroker is now a trading Web site and your travel agent is more likely a glorified search engine.
All this worked well in a rising economy, where non-monetary riches such as attention (Web traffic) and reputation (Google PageRank, which determines how high your site will appear in a search) could be turned into cash with the wave of a venture capitalist's wand or a well-timed acquisition. But this year, for the first time since 2001, the overall tide of investment and advertising won't rise. Indeed, it will almost certainly fall. Venture capital has dried up, Google is killing products rather than buying them, and Yahoo can barely support itself, much less look for others to fund. What does that do to Free as an economic model?
From a consumer perspective, it should only help. After all, when you have no money, $0.00 is a very good price. Expect the shift toward open source software (which is free) and Web-based productivity tools such as Google Docs (also free) to accelerate. The cheapest and coolest computers today are 'netbooks,' which sell for as little as $250 and either ship with free versions of Linux or super-cheap old versions of Windows. The people who buy them don't load Office and pay Microsoft hundreds of dollars for the privilege. Instead, they use online equivalents, as the netbook name implies, and those tend to be free.
These same consumers are saving their money and playing free online games, listening to free music on Pandora, canceling basic cable and watching free video on Hulu, and killing their landlines in favor of Skype. It's a consumer's paradise: The Web has become the biggest store in history and everything is 100% off.
What about those companies trying to build a business on the Web? In the old days (that would be until September of last year) the model was pretty simple. 1. Have a great idea. 2. Raise money to bring it to market, ideally free to reach the largest possible market. 3. If it proves popular, raise more money to scale it up. 4. Repeat until you're bought by a bigger company.
Now steps 2 through 4 are no longer available. So Web startups are having to do the unthinkable: come up with a business model that brings in real money while they're still young.
This is, of course, nothing new in the world of business. But it is a bit of a shock in the Web world, where 'attention' and 'reputation' are the currencies most in demand, with the expectation that a sufficient amount of either would turn into money someday, somehow.
The standard business model for Web companies that don't actually have a business model is advertising. A popular service will have lots of users, and a few ads on the side will pay the bills. Two problems have emerged with that model: the price of online ads and click-through rates. Facebook is an amazingly popular service, but it also an amazingly ineffective advertising platform. Even if you could figure out what the right ad to serve next to a high-school girl's party pictures might be, she and her friends probably won't click on it. No wonder Facebook applications get less than $1 per 1,000 views (compared to around $20 on big media Web sites).
Google has built an enviable economic engine on the back of its targeted text ads, but the sites on which they run rarely feel as flush. Running Google's Adsense ads on the side of your blog, no matter how popular it may be, will not pay you even minimum wage for the time you spend writing it. On a good month it might cover your hosting fees. I speak from experience.
What about the oldest trick in the book: actually charging people for your goods and services? This is where the real innovation will flourish in a down economy. It's now time for entrepreneurs to innovate, not just with new products, but new business models.
Take Tapulous, the creator of Tap Tap Revenge, a popular music game program for the iPhone. As in Guitar Hero or Rock Band, notes stream down the screen and you have to hit them on the beat. Millions of people have tried the free version, and a sizable fraction of them were ready and willing to pay when Tapulous offered paid versions built around specific bands, such as Weezer and Nine Inch Nails, along with add-on songs. (The Wall Street Journal is pursuing a strategy of blending free and paid content on its Web site.)
At the other end of the business spectrum there's Microsoft, which now has to compete with the free word processors and spreadsheets of online competitors such as Google. Rather than complain about the unfair competition (which would be ironic), Microsoft created Web versions of its business software and offered them free to small and young companies. If your firm is less than three years old and under $1 million in revenues, you can use Microsoft's software without charge under its BizSpark program. When those companies get bigger, Microsoft is betting that they'll keep using its software as paying customers. In the meantime, the program costs it almost nothing.
But extracting a business model from free is not always easy, especially when your users have come to expect gratis. Take Twitter, the fantastically popular (and free, of course) 140-character messaging service where people update the world on what they're doing, one haiku-like snippet at a time. After taking over the world, or at least the geeky side of it, it now finds itself having to actually make enough money to cover its bandwidth bills. Last year it hired a revenue guru to try to find a business model and has announced that it intends to reveal its strategy early this year. Speculation as to what that will be ranges from charging companies to have their 'tweets' recommended to consumers (which is a bit like 'friending' the Burger King on Facebook) to certifying identity to avoid impersonation. The revenue officer has his work cut out for him.
Mirko IlicMeanwhile YouTube is still struggling to match its popularity with revenues and Facebook is selling commodity ads for pennies after its effort to charge for intrusive advertising led to a user backlash. And news-sharing site Digg, for all its millions of users, still doesn't make a dime. A year ago, that hardly mattered: The business model was 'build to a lucrative exit, preferably in cash.' But now the exit doors are closed and cash flow is king.
Does this mean that Free will retreat in a down economy? Probably not. The psychological and economic case for it remains as good as ever -- the marginal cost of anything digital falls by 50% every year, making pricing a race to the bottom, and 'Free' has as much power over the consumer psyche as ever. But it does mean that Free is not enough. It also has to be matched with Paid. Just as King Gillette's free razors only made business sense paired with expensive blades, so will today's Web entrepreneurs have to not just invent products that people love, but also those that they will pay for. Not all of the people or even most of them -- free is still great marketing and bits are still too cheap to meter -- but enough to pay the bills. Free may be the best price, but it can't be the only one.
此外，同样的数码经济学也让一些全新的商业模式应运而生，比如“免费-收费模式”(Freemium)，即付费版本支援免费版本。在这种模式中，免费版产品成为一种行销工具，使更多用户接触到这种产品。企业在产品推广过程中会试图将部分免费用户转化为付费用户，从而获取收入。这是对以前那种免费赠品推广模式的颠覆：商家不是给出一块试吃蛋糕，希望把剩下的99块卖出去；而是送出去99只虚拟企鹅，以图卖出一栋虚拟小屋。（摸不着头脑了吗？可以找个小孩子问问：企鹅俱乐部(Club Penguin)的巨大成功， 靠的就是这种商业模式。）
谷歌通过对消费者提供有的放矢的文字广告，建立起一个令人 慕的赚钱机器，但依赖谷歌运作的网站很少有这种好事出现。如果你在自己的博客上放置Google's Adsense广告，不管广告点击率有多高，你能挣到的钱，都不及你撰写博客所付出时间能获得的最低报酬。在好的月份里，收入也只够支付主机托管费。这是我的经验之谈。
举例而言，Tapulous公司运营着一款为iPhone开发的热门音乐游戏《Tap Tap Revenge》。在《吉他英雄》(Guitar Hero)和《摇滚乐队》(Rock Band)游戏中，音符从手机萤幕上方涌出，让你按照节奏击打它们。目前已有数百万用户使用过该游戏的免费版，其中有相当一部分人准备并且也愿意购买该游戏的付费版。付费版与免费版的主要不同在于能提供特定乐队的音乐，如Weezer乐队和Nine Inch Nails乐队等，而且还附有歌曲可供选择。（《华尔街日报》也在其网站上推行同时发布免费和收费内容的做法。）
在免费基础上建立一种商业模式并非易事，尤其是当你的用户已经吃惯了免费大餐。以Twitter为例，这个超级流行的（当然也是免费的）短资讯平台可以让用户发送不超过140个字元的短消息，告诉别人自己正在干什么事情，一条资讯说一点。在横扫全世界、至少是世界上的前卫群体后，现在公司发现自己的收入不足以支付宽频使用费。2008年，公司聘请一位财务大师，希望找到一种可行的商业模式，并表示将于2009年初公布其发展战略。人们对它可能采用的模式有种种猜测， 其中包括让做广告的企业向消费者发送“悄悄话”（有点像让Burger King速食店建立一个Facebook档案），以此向公司收费；以及给予身份认证，以防假冒。这位财务大师的任务艰巨。