free for ALL?

I recently picked up the latest WIRED mag to find that Chris Anderson is at it again.  His article was published as the cover story.  This time, he wasn’t dishing on the Long Tail… Chris stepped into to new (yet familiar) territory. 

The article discusses the power of “free”.  We experience free services every day when we search the internet.  Sure, Google is free to use… but how many ads do you see when you use it?  Anderson’s article makes the case that people want FREE.  We like FREE.  So, if companies make their products and services free, then how do they get paid?  Anderson’s answer is that they get paid by third party.  Meaning, while I might surf Google for free, someone else might be purchasing an item from a company that is advertising on Google.  Therefore, Google eventually gets their money.  Here is a chart from the article that describes this relationship:

I liked how Anderson explored the interconnectedness of the internet.  It got me thinking about the chain of events that happens in our money market.  What I decide to purchase could in effect pay for some advertising on Google, who pays Google to support the ad. 

Here is an excerpt from the article:

As much as we complain about how expensive things are getting, we’re surrounded by forces that are making them cheaper. Forty years ago, the principal nutritional problem in America was hunger; now it’s obesity, for which we have the Green Revolution to thank. Forty years ago, charity was dominated by clothing drives for the poor. Now you can get a T-shirt for less than the price of a cup of coffee, thanks to China and global sourcing. So too for toys, gadgets, and commodities of every sort. Even cocaine has pretty much never been cheaper (globalization works in mysterious ways).

Ever since I first read The Long Tail, I have been impressed by Anderson’s “freakonomics” way of looking at industry.  This article did not disappoint.  Keep it up!

-Lindsey