Dear Malcolm: Why so threatened?

It’s now clear that the bane of my next year will be questions about the future of the newspaper industry from journalists. I don’t blame them—newspapers are indeed one of the industries most affected by Free (although that’s just one manifestation of their larger problem: having lost their monopoly on consumer attention). And neither I nor anybody else has any good answers, other than the newspaper business is probably going to shrink but not go away, and that the business model will have to change.

But since journalist Malcolm Gladwell has somewhat parochially decided to make the Future of Paid Journalism the focus of his review of Free (which is, ironically, free on the New Yorker’s website; perhaps this is something Gladwell should take up with David Remnick?), I’ll try to respond in a bit more detail.

Gladwell (who, by the way, I both like and admire, so let’s call this an intellectual debate between corporate cousins) writes:

“[Anderson argues that] newspapers need to accept that content is never again going to be worth what they want it to be worth, and reinvent their business. “Out of the bloodbath will come a new role for professional journalists,” [Anderson] predicts, and he goes on:

“There may be more of them, not fewer, as the ability to participate in journalism extends beyond the credentialed halls of traditional media. But they may be paid far less, and for many it won’t be a full time job at all. Journalism as a profession will share the stage with journalism as an avocation. Meanwhile, others may use their skills to teach and organize amateurs to do a better job covering their own communities, becoming more editor/coach than writer. If so, leveraging the Free—paying people to get other people to write for non-monetary rewards—may not be the enemy of professional journalists. Instead, it may be their salvation.”

Anderson is very good at paragraphs like this—with its reassuring arc from “bloodbath” to “salvation.” His advice is pithy, his tone uncompromising, and his subject matter perfectly timed for a moment when old-line content providers are desperate for answers. That said, it is not entirely clear what distinction is being marked between “paying people to get other people to write” and paying people to write. If you can afford to pay someone to get other people to write, why can’t you pay people to write? It would be nice to know, as well, just how a business goes about reorganizing itself around getting people to work for “non-monetary rewards.””

Well, I wouldn’t propose this as the future of all newspapers, but my model comes from personal experience. About three years ago, I started a parenting blog called GeekDad, and invited a few friends to join in. We soon attracted a large enough audience that it became apparent that we couldn’t post enough to satisfy the demand, so I put out an open call for contributors. Out of the scores who replied, I picked a dozen and one of them was Ken Denmead (at right, with Penn of Penn & Teller).

Ken is, by day, a civil engineer working on the BART extension in the SF Bay Area. But by night he is an amazing community manager. His leadership skills impressed me so much that I turned GeekDad over to him entirely about a year ago. Since then he’s recruited a team of volunteers who have grown the traffic ten-fold, to a million page views a month.

So here’s the calculus:

• Wired.com makes good money selling ads on GeekDad (it’s very popular with advertisers)
• Ken gets a nominal retainer, but has also managed to parlay GeekDad into a book deal and a lifelong dream of being a writer
• The other contributors largely write for free, although if one of their posts becomes insanely popular they’ll get a few bucks. None of them are doing it for the money, but instead for the fun, audience and satisfaction of writing about something they love and getting read by a lot of people.

So that’s the difference between “paying people to write” and “paying people to get other people to write”. Somewhere down the chain, the incentives go from monetary to nonmonetary (attention, reputation, expression, etc).

It works great for all involved. Is it the model for the newspaper industry? Maybe not all of it, but it is the only way I can think of to scale the economics of media down to the hyperlocal level. And I can imagine far more subjects that are better handled by well-coordinated amateurs than those that can support professional journalists. My business card says “Editor in Chief”, but if one of my children follows in my footsteps, I suspect their business card will say “Community Manager.” Both can be good careers.

Malcolm, does this answer your question?

[Image at top from The New Yorker. Photo of Ken Denmead from GeekDad.]

Comments

[mwood]

I think the biggest problem with the argument that all content should be free is the assumption that there isn't a difference between the quality of work of a dad who is passionate about technology and a trained writer.

I think that there is a market for both types of writing, especially in the digital age, but in the end, someone is making money off this content, and it's ridiculous to say that the person who created the content you're making money off of shouldn't be paid. That they should just do it because they love it.

The fact is, love doesn't pay the bills and if we as a society want to continue to have engaging, exciting written works, music and other art forms, we need to support the artists that create it.

[Belinda Gomez]

"None of them are doing it for the money, but instead for the fun, audience and satisfaction of writing about something they love and getting read by a lot of people."

So why buy a cow when milk's so cheap? Why not extend this example to teaching? No more unions! Or fire departments? It's fun to drive the firetruck!

IF Wired.com makes "good money" off the ads, why not share that with the writers? Ken's book deal could easily fizzle, and dreams don't pay the bills. This is exploitation. Sweatshops are better, because they're not pretending.

[Chris Anderson]

ARGH! For the thousandth time, the book DOES NOT argue that all content should be free. Many will work for free and some will work for money. The business model that the book focuses on is Freemium which is free+paid.

[Al Billings]

Mwood, then the artists and the businesses around them need to find a model that works. The one used by the newspaper industry clearly doesn't do so.

[alan p]

Who owns GeekDad, ie who is the principal accruing the wealth that these people's labour is creating?

[Aaron Pressman]

The sad problem at the root of many journalists' confusion, including Gladwell's apparently, is that they thought all the revenue and profits rolling in to newspaper coffers in past decades reflected the value of their work when in fact much of it represented the value of the hard-to-match production and distribution chain that could pump out relatively cheap classified ads and Sunday supplements and blanket them all over town. The Internet, as it often does, disintermediated that distribution chain and much of the revenue and profits migrated elsewhere.

[No Name Please]

Chris, you never mention what happened when GeekDad writers were offered a fee (albeit small) if they could bring the site's monthly pageviews up to a certain goal.

As I recall, it really kicked the blog into overdrive. And after the fee was eliminated, several of the original contributors drifted away. Most contributors continue to make some money from their blogging through affiliate links and other opportunities.

Also, strictly speaking, some of the GeekDad bloggers are professional writers. Their reasons for writing for free may include keeping their hand in while trying to figure out how to make a living in this new economic reality.

That new model may include writing a lot more for many different outlets for much smaller fees than in the past.

[Nick67]

The newspaper business has problems--journalism in general has a lot of problems--both monetary and professional. As an earlier poster noted, the disintermediation of the internet is destroying the business model of ALL the old media companies. In fifteen years, they're all going to be dead: the movie studios, the TV networks, the record companies, the cable companies, satellite and FM radio, AND newspapers.

What is going to replace them all isn't clear yet. What is clear is that whatever replaces them will need to serve the same purpose--to unite a media consumer with content that costs and content that pays in proportions that are profitable. The internet has put the media consumer in charge, and THAT is a fact that the existing paradigm is not equipped to deal with.

There is media content I would pay for, there are also ads I would pay to see, there are ads I can be paid to watch, and there is content that I have no interest in. The present media companies bundle all of it in an all-you-can-eat package that fewer and fewer people are paying for. The trick will be to allow ME to pick my content--having me pay for content I want, and paying me to view ads (much better ads than most of the crap produced today, both in humor, style, and content)

One way or another, broadcasting is dying, and unicasting business models don't exist yet

[Chris Anderson]

mwood wrote: "the biggest problem...is the assumption that...there isn't a difference between the quality of work of a dad who is passionate about technology and a trained writer."

Yes, there is a difference. The passionate amateur is often better. See my post here: http://www.longtail.com/the_long_tail/2008/09/a-passionate-am.html

And I say that as a "trained writer" (whatever that means--I trained myself; I didn't go to journalism school or get a writing degree).

I'm a big fan of professional journalist and employ a lot of them. But anybody who thinks that a well-chosen and well-motivated amateur can't do a great job (sometimes a better one) on a subject they know a lot about is either arrogant or not paying attention. As an editor, my problem is that it's hard to find the right such people on any given subject, which is why we use professional journalists, who can be trusted to do a good job on almost anything. But if I encounter a non-journalist with something profoundly interesting to say, I'm happy to run her/him right alongside my pros (and pay, of course).

[Simon]

"ARGH! For the thousandth time, the book DOES NOT argue that all content should be free. Many will work for free and some will work for money. The business model that the book focuses on is Freemium which is free+paid. "

Perhaps your next book should be about the attention-starved dyslexic generation who can read but only comprehend that which fulfills their own inner stereotypes.

The internet is full of them.

[anderS]

Regarding the first comment, the question is this:

Who can write better about a specific subject/niche?
The professional writer with no particular forehand knowledge, or the enthusiast (professional?) who works in that field and likes to write about it in his spare time.

The context here is content and it should be.

We are in an age of information sharing peer 2 peer, with less and less intermediaries. (though not in the age of wiki-surgeries luckily)

The main remaining publisher/organiser function, as Chris points to, is to recognize a need (i.e.Geekdad) bring a community together and distribute both the work and profits on clear, fair principles.

Part of that is still taking risks and making investments, which in the example is done by Wired/ Chris. But that is actually not that fundamental anymore... it could be done by any group properly organized and done either for or not for profit..

What I find very interesting is how far will the Freemium idea reach, beyond online?

In real life we are still facing scarcity everyday, next to misplaced abundance. Most striking is the mismatch between supply and demand..

[mwood]

I went to journalism school, but I have never worked in print. I recognized right away that they way people consumed information was changing rapidly. Publications might give away their content for free to readers, but that doesn't mean they aren't making money. A lot more goes into writing for the web, and you certainly don't need to have gone to journalism school to do it well, but my feeling is that while some amateurs may blossom, it's because they immerse themselves in this world, they learn about what works, how to drive traffic and continually offer up interesting engaging content that brings readers back to that site.

If you find someone, amateur or otherwise, that can do all of these things, they are making you money. And they deserve a cut of it. I don't think anyone who makes a living by writing goes into a project without throwing themselves in 100% - it's never been a high paying career, it probably never will be. But the number of publications demanding free work increases everyday, and that model doesn't work. My hope is just that a balance does emerge, because I love what I do and I want to continue to find ways to do it in a financially feasible way.

[Fritz]

Dear Chris, Why Such A Hypocrite?

Perhaps if you book was published freely on the internet with a few premium insights offered for revenue, I'd put more stock in you ideas.

You're obviously a talented trendmeister, making money on fadd'ish ideas. There's nothing wrong on making a lot of money and a reputation on fads, (i.e. The Long Tail is now widely discredited).

I read Malcom's article yesterday and it is quite good. It took some 'stones to stand up to the massive overweening pride of digital cheerleaders like you.

Nothing personal Chris, but anyone who promotes ideas like "freemium" ought to expect some guff.

[Mattias Lundmark]

Chris,

Like the discussion between yourself and Malcolm (hoping for a response from Malcolm now), it was interesting enough to follow that I now will pick up a copy of the book myself to create my own take-aways. I guess that is the power of Free marketing... ;)

As an employee of Lavasoft, the creators of the anti-malware software Ad-Aware, I can only testify to that the freemium model indeed works and feels great for the employees to run. Word of mouth is huge for us, and that is largely thanks to Ad-Aware Free being #1 in lifetime downloads on download.com - thanks to all the supporters of Ad-Aware and their vocal appreciation of the software.

In my eyes, the freemium model is important enough to the subject of Internet marketing to warrant at least one book - well done in writing one. Maybe Malcolm will have enough to say about the subject to write a second - I sure wouldn't mind.

[Nikki]

Everyone starts off as an amateur writer, but as they get better they may begin to write for money as the quality of thier articles get better. However I do agree with Chris that there are amateur writers that are good enough to become professional and get paid, but may choose to only do it as a hobby.

-Nikki-
selling photography 101

[pwb]

Why are people so obtuse?

It's not that "all content should be free". It's that stuff that's digitally reproducible at near-zero cost will trend towards Free. Chris is not a hypocrite for writing a book that costs money. As he states numerous times, Free is merely a component of his offering and in fact the book and portions of the book are widely available for no/lo cost. It's not that people should not be paid for their work. It's that there is likely someone else willing to do it for no/lo pay or another form of non-monetary compensation.

In short, Chris is right, Malcolm is wrong.

[Peter Rubie]

Forgive me for saying so, but I think the argument about free or not free is a little overblown. There are clear comparisons in other arts, notably painting, opera, and jazz for example, where free and amateur can sometimes lead to professional quality material and certainly without such lovers of the art form it would die out completely, so such people can rightly be thought of as keepers of the flame. But the truth is, for example, that for all the great weekend warrior jazz saxaphone players out there today, there really isn't an equivalent John Coltrane, Charlie Parker, or Stan Getz rising through the ranks and that is because it is harder and harder for musicians to spend all their time working at their craft and fewer opportunities for them to demonstrate it to an appreciative audience. (Sound like the newspaper industry to anyone?) So instead of the next Sarah Vaughan, we get instead (no offense) Diana Krall.

And so it may be with news coverage. It's not just that professional standards suffer because those out there calling themselves professionals do not have the stamina, training or insight of those who went before, but that the objective quality of the information these so-called journalists give us is just poorer. The definition of the enthusiastic talented amateur tends to precludes strong objectivity where it is needed. And when that happens our ability to make decision becomes comparably poorer.

However, a missing element here that may help to redress the balance somewhat is the forthcoming next gen of electronic readers with 12 inch or larger screens, some likely in colour. This may well reinvigorate the subscription model of newspapers and magazines who will not only be able to continue delivering professionally enviable quality material, but will be able to enhance the current newspaper experience with updatable and ongoing coverage of a story that used to be handled by evening editions and 2nd editions of papers thus returning us to something comparable to the heyday of newspaper publishing.

[Jorge Muñoz]

Chris's ideas interest me and seem quite right. Soy de San Rafael Mendoza Argentina and perhaps pay some bucks for the book Chris. Does anyone ever imagine that a person so far away could buy that book? Undoubtedly a part of the long tail in the book mentioned above.
And just because you buy for free learn to achieve the idea of the book, see the reviews of Malcolm included, and occasionally using the google translator to understand the ideas and even write this post. ALL FREE.
And I think that all this is just a description of reality.
Globalization is a result of lower costs of distribution and communication, and in industries where the cost of these services were an important part of the price if the distribution and communication tends to zero the price tends to zero as well.

SALUDOS DESDE ARGENTINA

[Seth Finkelstein]

That's a very blunt description of what I talk about in terms of "Digital sharecropping". The problem is that while it may work for a tiny tiny number of people at the top, basically hucksters, marketers, and owners of electronic plantations, it doesn't work in terms of supporting many people outside that group.

However, it's very difficult to discuss this with the one of the hypesters, since their job consists of coming up with ways of selling it, not analyzing it. That is, if it were wrong, they'd have to find something else to flog.

[Chris Maury]

The disagreement between free content providers and "old school" content providers, publishers, newspapers, musicians, etc. boils down to fundamental differences in how to assign value.

In a system where value is assigned monetarily, providing content for free is not only counter-intuitive, but contrary to unsustainable as a business model; the value of the content provider is inherently linked to the value of the content, thus content cant be free.

In a system where value is assigned by other means, in the case of abundant information, by the number of hits/downloads/retweets and level of diffusion, charging for content becomes a limiting factor in creating value.

Google, Huffington post, Techcrunch, and even Chris Anderson are all examples of the success possible by separating monetary returns from the value of distributed content.

Struggling Newspapers, RIAA lawsuits, and the general decline of physical distribution models for content are examples of problems inherent in the monetary valuation system for content.

[Will]

Chris Anderson wrote: "But if I encounter a non-journalist with something profoundly interesting to say, I'm happy to run her/him right alongside my pros (and pay, of course)."

Except when you don't. As you said, "if one of their posts becomes insanely popular they’ll get a few bucks." I'm assuming you're being casual here, but why share the profit only when something is "insanely" popular? Where does that advertising revenue go instead of the writer and why?

I imagine your answer is *not* "because there are plenty of other writers where that one came from," but that's the specter that's haunting the spaces where you leave things unsaid. There's a curious (or frightening) disparity in the shadows beneath the Free model: that I am not wealthy enough to be a writer because I do not have a lucrative bill-paying first job to fund my nighttime hobby of freely generating content for you to sell. That, at least, is why I feel threatened.

[Charlie Jacoby]

How about this as a short manifesto for the future of 'the media':
* Media delivery is now free
* Media creators need funding and will find it most easily from businesses
* Media creators will disseminate their output through the channels available to them on this new free media network.
* Individual media creators or groups of no more than four (who between them cover the roles of presenter, writer, photographer, techie, fixer, cameraperson, sound engineer, film editor, producer) will replace the 'ant heap' media conglomerations we see today such as TV networks, newspapers and magazines
* Media creation remains a craft not an art

My work is to find a subject suitable for what used to be called a 'feature' and produce an article and TV package about it (including a plug for my sponsors). I then put it out on all of the following: my website, a blogspot site, my Yahoo group, an eShot to my own list of subscribers, my YouTube site, my podcast site and iTunes, a subscription DVD, any magazine in that specialist consumer area, and any national newspaper website and local TV news network desperate enough to run free footage repackaged as 'news'. The only income I derive from this is from sponsors.
I used to edit magazines. I just resigned from my last one because this new model is more profitable. I expect what has happened to me will happen to everyone like me over the next ten years.

[Matt Winchell]

Man, Chris. You got owned. I'm glad you didn't address anything Gladwell said in his article and instead just quoted him summarizing your views and threw out another example of a 'free' or 'freemium' business model to be discredited. Because that's the best way to carry on an "intellectual debate between corporate cousins"; avoid the arguments and throw out non-sequitur examples.

[Ben]

I read Gladwell's review, and there is no way in which it is focussed on the future of paid journalism, as implied in the above post.

Maybe you only read the first page, Chris? There is a next button at the bottom, you see? ;-)

All things considered, it's a very good review of what seems to be a crappy book indeed.

[Alexandra Erin]

@Seth Finkelstein:

The thing that keeps me optimistic about all this is how the same dynamic that allows for "digital sharecropping" also allows for "digital subsistence farming", which can grow into a "digital communal farm".

To ditch the extended farm metaphor: we can acknowledge that it's hard for a solo operator writing or producing other content on the web to produce the kind of money that gets spent on a given newspaper, a given book, a given CD, or any other mass-media production. But that same solo operator isn't splitting the pie fifty different ways with layers of marketers and middlemen. They pay their hosting costs (often low), the cost of any content distribution service they use, any transaction fees, etc., but they're paying those costs out of 100% of the gross instead of taking home an insultingly low royalty.

We shouldn't look at this "digital sharecropping" like it's something shocking and new. The digital part is, but it's the same thing that's been happening forever.

Outside of the breakout superstars, the people producing content have long received the short end of the stick. We've all heard it said, I'm sure, that bands put out albums to promote their tours... they see basically bupkis of the album sales, and then they go out and earn their living doing concerts. Journalism notwithstanding, most "professional authors" (as the term "professional" is defined by professional associations) do not make a living from their writing.

Ms. Amanda F. Palmer, formerly of the Dresden Dolls, recently blogged about her experiences interacting with her fans directly on Twitter. By appealing to her following directly, she grossed $11,000 selling a t-shirt she designed herself. She compares this to what she's received from her latest studio album, which she claims to be $0.

Imagine if instead of selling that album through a big corporation she had a record deal with, she'd given it away. She'd be out no money and have engendered quite a bit of good will. She might have had more people following her on Twitter when she made her spontaneous t-shirt offer.

Now, she had an existing following going into that. One might argue that a "nobody" couldn't just go online and do that. And this is very true. And Amanda Palmer couldn't have done it years ago at the start of her career. She had to work to get where she is now. Who can say at this point whether or not she could have built a similar following if she'd started out with a direct-to-fans model? She would have started out pushing uphill and fighting just to keep her head above water, as most artists do, but given her talent and drive it's likely that at some point she'd become self-sufficient.

At a time when newspaper comic sections are shrinking and smaller newspapers are being forced to cut them entirely, endangering non-syndicated independent cartoonists' livings, the best and highest quality webcomics out there are earning their owners a living. (I know most of them aren't, but if you judge a medium by its failures, we have to look at all the unpubulished manuscripts and unsold articles in traditional media and judge it a failure, too.)

They might not bring in as much money as a syndicated comic strip generates for the syndicate, but it's only being split one or two ways.

Subsistence farming.

Independent creators and solo operators are in a great position to take advantage of the power of Free. While they don't have the deep pockets or the ability to spread loss around after a risk, they've got fewer mouths to feed.

[Terri Vernon]

I have a dirty secret. I have done my share of free art and design work over the years. I have also at times sold and licensed my artwork for a pittance. Why? Lots of reasons. Maybe it’s just cynical middle age creeping up on me, but the more I do this, the less I like it. Maybe I have finally decided that my work, my training, my talent and my time have value and should be treated accordingly

[Galen]

I think Gladwell is making the wrong objection. The problem isn't whether you can get journalists to write for free--you clearly can. There are two crises in the media--one is that there are a lot of people who want to get paid for writing who aren't going to be able to get paid. Too bad for them, but if they can be replaced by people willing to work for free who will do a comparable job there's no real societal problem. The second crisis is that the media _overhead_ costs a lot of money. Maybe you can get your reporter to write for free, but you still have to fly him to Baghdad and pay for his hotel and security. Unless we don't want that kind of reporting, somebody has to pay for it.

It's also worth being clear about the causal chain in the journalism crisis. It wasn't "information wants to be free" so people started pirating newspapers and eventually the industry gave in and started giving the product away for free. It was that thousands of people who were interested in journalism and news decided it would be fun to create their own news content and give it away for free, and newspapers subsequently realized that their potential online readership was happy with the stuff they could get for free and so wasn't willing to pay for subscription content. In other words, the crisis was _caused_ by the fact that you can easily get people to do journalism for free.

[Burak Ozan]

This is a fascinating argument and attracts so many brilliant minds. It is rare to see Seth, Malcolm and Chris talk on the same topic within couple days, an intriguing subject. When you read these three master minds, you know that this is real and hot.

Bottom-line is that Free business model is real and actually already here. You can maybe argue, in which industries it will work best or where in value chain/network it will make a big difference, or which functions within an organization can capitalize on it more than others but not about if it is real or not!

By the way, no one is arguing if there will be only one model or not; Chris already clarified this I believe in Wired's latest edition: "We're good at scarcity thinking - it's the 20th century organizational model. Now we have to get good at abundance thinking, too."

Actually these three posts may be in my opinion the main drivers for selling this controversial book; what can be a better example than this, all free marketing by passionate people and their passionate followers, rather than 30 sec spots, paid reviews or ads...

the question now is, what will you do about it?

and it is time to answer it sooner than later; not just for the people who are threatened with this paradigm shift in business, but rather for everybody ...

[ambrose]

Chris, are you serious about the DweebDad example. I bet you’re having a really good laugh right now. Is that the best you can do? I mean is that what the future holds? Is that the model you’ve been talking about?

The Internet with all its infinite wisdom is plopping us squarely back into the dark ages.

[Fernando]

"If you can afford to pay someone to get other people to write, why can’t you pay people to write?"

I think is very simple.

I would have no problem paying for a book that teaches me how to write. But it would be more difficult for me to pay money to buy a newspaper or magazine to read an article about a new book that will teach me how to write since I knew about the book already from all the free information on the web.

[Michelle Haimoff]

Chris, wondering what you think of this business model for journalism:

http://www.huffingtonpost.com/michelle-haimoff/a-new-business-model-for_b_193011.html

[Joel Hamburger]

@ Alexandra Erin,

Hypothetical case: Amanda Palmer self release budget. For the time being we will assume that Ms. Palmer will NOT be working a full time job to concentrate on finishing her record.

Pre-Production:

Song Writing: 4 weeks x 50 hours/week to write 12 songs (day job really kills the creative process). Rent+Food+Expenses for apt. in Brooklyn @ $1400/mo. 2 more weeks for tracking demos + administration. ($2100)

Rehearsals: 2hr twice-weekly @ $20/hr for 4 weeks ($480)

Administration: 2 days to line up personnel for the recording session and rehearsals. 1 day to tour studios + audition engineers and producers. 1 day to book 3-4 gigs. 1 day to line up string players for 2 songs.

Gigs: $60 in cabs to get from rehearsal studio to gig and back again. $50 per gig for food and beer for the band (they're friends so they are happy to forgo the $50/player "indie" rate... ) add $125 for the date the drummer can't make as his kid is ill and you need to get a ringer. ($565 for the 4 gigs)

Instruments: Amp repair @ reputable center $125. Piano Tuning $80. Sadly the acoustic guitar you love dearly was wrecked at a gig but your friend lends you another... ($125)

Demo recording: 1 week (mentioned above). Upgrade to latest version of ProTools so you can more easily experiment with finding the correct tempo for your song $150.

Pre-production total $3420.

I won't bore you with a line item budget for the remaining phases but here's a rough idea.

Production: $10k (recording studio time, session players, mixing mastering, food at the sessions, 3 weeks total time)

Post-production: $2.5k (graphic design, pressing of CD's to sell at shows)

Marketing: $5k (photo-shoot, website design, social-media marketing, publicity - you need to have your stuff out on the blogs don't you)

Legal fees: $1k (small distribution deal, one placement in a corporate industrial)

Touring: $8k (van rentals, payment of musicians, hotels, food, gas for a 3 week east coast jaunt)

TOTAL FOR ONE RECORD: $35k

This is a realistic all-in indie budget, you can be sure that RoadRunner spends more on their artists.

How can the "freemium" business model be sustainable for Ms. Palmer ? $11k in T-Shirts are not going to cut it.

Mr. Anderson's thesis possibly holds water with regards to mostly solitary, non-collaborative and non-technically intensive modes of production.

possibly..

In the meantime I look forward to downloading my copy of free. I also enjoyed the copy of the long tail I borrowed from a friend a few years back.

[Account Deleted]

I am very pleased with the thought and don’t feel like adding anything in it.

Corporate Business

[Account Deleted]

I am very pleased with the thought and don’t feel like adding anything in it.

Corporate Business

[Test]

Test

[Fernando Emmanoel Borba]

@Fritz
"Dear Chris, Why Such A Hypocrite?

Perhaps if you book was published freely on the internet..."

Dear Fritz, this is not hypocrisy, this is his strategy. Look at 37Sginals guys... they wrote an awesome free book (Getting Real). But, you can buy it. They got huge free publicity because of this book.

It's just a matter of strategy.

[Matthew T. Grant]

As some of mentioned here and Stowe Boyd points out on his blog, Gladwell's main criticism is that even as things tend towards the immaterial ("made of ideas") there are still very real costs associated with distribution infrastructures, etc. Energy "too cheap to meter" requires plants and grids too expensive to ignore; videos too numerous to count and too "bad" to sell still require bandwidth costing in the millions to access.

Anyway, Gladwell's piece seemed both empassioned and compelling.

[Gab Goldenberg]

Chris,

You might want to clarify to Malcolm that the whole book isn't arguing that everything will be free. That was the impression I got from Malcolm's article and was not rebutted in your response. Malcolm may also have misunderstood.

To the point of free and your example from Geekdad: You're generalizing from the specific in a way that doesn't necessarily work. There may have been other factors that made you able to sell ads profitably on GeekDad, such as a desirable demographic (for advertisers) that largely overlaps Wired (so that advertising on both lifts ad retention rates, as I've written in my Poor Man's Retargeting articles on advertising).

Regards,
Gab Goldenberg

[Mike Mella]

Chris, I feel the need to comment on Gladwell's article, but since his does not allow reader comments, I hope you don't mind my doing so here.

Gladwell says:

Generating and distributing electricity, however, requires a vast and expensive infrastructure of transmission lines and power plants—and it is this infrastructure that accounts for most of the cost of electricity. Fuel prices are only a small part of that.

There's a serious flaw in this argument, and that is the assumption that although evolving technology might reduce the production cost of an item, it will not affect any other part of that item's economy.

To use a music example, it's not that the cost of pressing CDs has become so cheap that musicians can give away CDs for free. If that had happened, Gladwell's argument (and Gordon Dean's I guess) would indeed apply: There's still a heavy cost to package and ship those CDs around the world, get them into stores and so on, so it's not practical to give them away for free even though it's cheap to make them. What has in fact happened is that a new means of producing recorded music has emerged (mp3s) but a new distribution channel has emerged as well (the Internet).

Gladwell seems to be willing to accept that technology can reduce production costs of an item, but unwilling to consider technology's affect on other aspects of that item's economy.

[Steven Royster]

Plenty of business models can be built off the simple idea that all of us have worked from the "bottom-up" throughout our careers/lives/chase-of-a-dream.

"Freemium" theorizes the advantages of distributing the products/services of those "hungry" for success to the masses, in exchange for the opportunity to get paid on the next endeavor, or the "back-end". So the person that Anderson hires to run "Geek Squad" will use the opportunity to create another opportunity.

The smart and diligent will understand their value at any given time and work to increase that value through their contributions.