Free: The Future of a Radical Price by Chris Anderson (2009)
Goodreads Summary: The New York Times bestselling author heralds the future of business inFree. In his revolutionary bestseller, The Long Tail, Chris Anderson demonstrated how the online marketplace creates niche markets, allowing products and consumers to connect in a way that has never been possible before. Now, in Free, he makes the compelling case that in many instances businesses can profit more from giving things away than they can by charging for them. Far more than a promotional gimmick, Free is a business strategy that may well be essential to a company’s survival. The costs associated with the growing online economy are trending toward zero at an incredible rate. Never in the course of human history have the primary inputs to an industrial economy fallen in price so fast and for so long. Just think that in 1961, a single transistor cost $10; now Intel’s latest chip has two billion transistors and sells for $300 (or 0.000015 cents per transistor–effectively too cheap to price). The traditional economics of scarcity just don’t apply to bandwidth, processing power, and hard-drive storage. Yet this is just one engine behind the new Free, a reality that goes beyond a marketing gimmick or a cross-subsidy. Anderson also points to the growth of the reputation economy; explains different models for unleashing the power of Free; and shows how to compete when your competitors are giving away what you’re trying to sell. In Free, Chris Anderson explores this radical idea for the new global economy and demonstrates how this revolutionary price can be harnessed for the benefit of consumers and businesses alike.
This was a book, like Rework, that I also found on the Top 10 Best Business Books for Entrepreneurs. The title itself sounded quite intriguing because it almost seems against common sense to be able to make money by giving things away. But that’s exactly what this book is all about and, it’s becoming more and more common for businesses to thrive by doing just that.
The author goes into the history behind this, how it got started, and why it’s taking off so fast and becoming so successful. Basically he argues that technology is helping things along because information is so easy and cheap to store. Plus, a new generation has grown up expecting digital services and content to be free. After all, you can’t touch it and it doesn’t really cost to distribute it, so why shouldn’t it be free?
There are a lot of examples about how companies give certain things away to draw customers in, only to charge for other things. He talks about the music industry giving away songs but charging for tickets to concerts. There was also a little bit about the book industry and piracy.
At the end of the book there are listed many different ways to use free for business, along with examples for each strategy. I found this book really fascinating and unique. But I wouldn’t say it really gives a clear outline as to how to implement these things. That information can be inferred by going through the examples and reading between the lines, but that’s not what the book is all about. Still, it was an interesting and enjoyable read.
I’d definitely recommend it if you’re interested in the “free” economy and behind the scenes of certain companies and how they work, or if you’re particularly fascinated by the idea of giving things away to make money. It’s a quite short book and very readable, not dry or boring in the least.
My Rating: ★★★★☆