Comments on: Freeconomics – maybe people will start paying for things http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/ Nic Brisbourne's view from London on venture capital and exploiting change in technology and media Sat, 11 Feb 2012 20:08:00 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Finance Geek » The eocnomics of free and consumer internet startups http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-5499 Finance Geek » The eocnomics of free and consumer internet startups Mon, 06 Jul 2009 09:17:08 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-5499 [...] with the basic arguments of ‘Free’ then I have written about them before, most recently here, and Alan Patrick has a very useful take [...] [...] with the basic arguments of ‘Free’ then I have written about them before, most recently here, and Alan Patrick has a very useful take [...]

]]> By: Next big thing: paying for content « Opencast Project - a blog http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4977 Next big thing: paying for content « Opencast Project - a blog Tue, 07 Apr 2009 17:20:05 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4977 [...] to zero is very different then them being zero see… Someone’s got to pick up the tab, see Nic Brisbourne’s post, and I [...] [...] to zero is very different then them being zero see… Someone’s got to pick up the tab, see Nic Brisbourne’s post, and I [...]

]]> By: Three Reasons Free Will Eat Itself | redcatco blog http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4976 Three Reasons Free Will Eat Itself | redcatco blog Mon, 06 Apr 2009 21:00:45 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4976 [...] zero is very different then them being zero see… Someone’s got to pick up the tab, see Nic Brisbourne’s post, and I [...] [...] zero is very different then them being zero see… Someone’s got to pick up the tab, see Nic Brisbourne’s post, and I [...]

]]> By: Finance Geek » Google to buy Twitter? - I really hope not http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4948 Finance Geek » Google to buy Twitter? - I really hope not Fri, 03 Apr 2009 10:14:52 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4948 [...] plus the cost of delivering the service is much less than YouTube (which now accounts for 10% of the internet’s bandwidth) - but to be fair I would probably have said something similar about YouTube back in 2006 when [...] [...] plus the cost of delivering the service is much less than YouTube (which now accounts for 10% of the internet’s bandwidth) – but to be fair I would probably have said something similar about YouTube back in 2006 when [...]

]]> By: Google to buy Twitter? - I really hope not | The Equity Kicker http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4947 Google to buy Twitter? - I really hope not | The Equity Kicker Fri, 03 Apr 2009 10:12:07 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4947 [...] Freeconomics - maybe people will start paying for things [...] [...] Freeconomics – maybe people will start paying for things [...]

]]> By: Charlie Blake-Thomas http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-6290 Charlie Blake-Thomas Thu, 02 Apr 2009 17:16:02 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-6290 Nic, good to see you again last night and to be on the panel. One of the points I was making (yes over and over again) is that free has a place. Free in itself is not a business model. It is one part of an offering and companies would do well to understand where it fits in to their overall offering. In my view, “free” should not be a cynical package designed to suck you in and upgrade you. Free should be a version of your product service that works for a subset of people that need to consume your product but who can never pay for it or who will use it to evaluate your product prior to paying for it. If you profile user bases and understand the value points to each segment you define, you can quickly identify what is useful/relevant to one segment that another will not need/care about. In our case, we understand why we have a free package, who it should be used for and what these value points are that mean that it offers just the right type of fuctionality for our “free” segment and means that our “Paid” segment understand why it will not work for them.<br>It is not always about giving more of the same when you pay either. If you truly understand how your target segment will use the service you are targeting at them then you will understand what it is they will pay for and what they won’t.<br><br>The other point I’d like to make is just because the marginal cost of supply has fallen to £0, that doesn’t mean that the VALUE has. It just means that a company can be more profitable. I don’t buy in to the argument that if marginal cost of supply = £0 then that should be passed on in its entirety. Web businesses are businesses and deserve to make money. They provide employment, valuable services, tax revenues etc. So with that in mind, companies whose sole offering is “free” should think about how they will make money from whatever it is they do. This takes time and is complex and in itself is a barrier to entry but is well worth figuring out in advance.<br><br>Finally, looking at newspapers, will we see the broadsheets becoming hardware manufacturers as a vehicule to distribute their new digital papers and to own the end user? Will all of them club together to go entirely online and cut out huge costs of production from their bottom line…<br><br>Thanks for listening. Nic, good to see you again last night and to be on the panel. One of the points I was making (yes over and over again) is that free has a place. Free in itself is not a business model. It is one part of an offering and companies would do well to understand where it fits in to their overall offering. In my view, “free” should not be a cynical package designed to suck you in and upgrade you. Free should be a version of your product service that works for a subset of people that need to consume your product but who can never pay for it or who will use it to evaluate your product prior to paying for it. If you profile user bases and understand the value points to each segment you define, you can quickly identify what is useful/relevant to one segment that another will not need/care about. In our case, we understand why we have a free package, who it should be used for and what these value points are that mean that it offers just the right type of fuctionality for our “free” segment and means that our “Paid” segment understand why it will not work for them.
It is not always about giving more of the same when you pay either. If you truly understand how your target segment will use the service you are targeting at them then you will understand what it is they will pay for and what they won’t.

The other point I’d like to make is just because the marginal cost of supply has fallen to £0, that doesn’t mean that the VALUE has. It just means that a company can be more profitable. I don’t buy in to the argument that if marginal cost of supply = £0 then that should be passed on in its entirety. Web businesses are businesses and deserve to make money. They provide employment, valuable services, tax revenues etc. So with that in mind, companies whose sole offering is “free” should think about how they will make money from whatever it is they do. This takes time and is complex and in itself is a barrier to entry but is well worth figuring out in advance.

Finally, looking at newspapers, will we see the broadsheets becoming hardware manufacturers as a vehicule to distribute their new digital papers and to own the end user? Will all of them club together to go entirely online and cut out huge costs of production from their bottom line…

Thanks for listening.

]]> By: brisbourne http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-6289 brisbourne Thu, 02 Apr 2009 17:13:16 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-6289 Sorry Charlie - I thought I had Sorry Charlie – I thought I had

]]> By: Charlie Blake Thomas http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-6288 Charlie Blake Thomas Thu, 02 Apr 2009 17:10:55 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-6288 Can you approve the comment?! Can you approve the comment?!

]]> By: Charlie Blake-Thomas http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4937 Charlie Blake-Thomas Thu, 02 Apr 2009 11:16:02 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4937 Nic, good to see you again last night and to be on the panel. One of the points I was making (yes over and over again) is that free has a place. Free in itself is not a business model. It is one part of an offering and companies would do well to understand where it fits in to their overall offering. In my view, “free” should not be a cynical package designed to suck you in and upgrade you. Free should be a version of your product service that works for a subset of people that need to consume your product but who can never pay for it or who will use it to evaluate your product prior to paying for it. If you profile user bases and understand the value points to each segment you define, you can quickly identify what is useful/relevant to one segment that another will not need/care about. In our case, we understand why we have a free package, who it should be used for and what these value points are that mean that it offers just the right type of fuctionality for our “free” segment and means that our “Paid” segment understand why it will not work for them.<br>It is not always about giving more of the same when you pay either. If you truly understand how your target segment will use the service you are targeting at them then you will understand what it is they will pay for and what they won’t.<br><br>The other point I’d like to make is just because the marginal cost of supply has fallen to £0, that doesn’t mean that the VALUE has. It just means that a company can be more profitable. I don’t buy in to the argument that if marginal cost of supply = £0 then that should be passed on in its entirety. Web businesses are businesses and deserve to make money. They provide employment, valuable services, tax revenues etc. So with that in mind, companies whose sole offering is “free” should think about how they will make money from whatever it is they do. This takes time and is complex and in itself is a barrier to entry but is well worth figuring out in advance.<br><br>Finally, looking at newspapers, will we see the broadsheets becoming hardware manufacturers as a vehicule to distribute their new digital papers and to own the end user? Will all of them club together to go entirely online and cut out huge costs of production from their bottom line…<br><br>Thanks for listening. Nic, good to see you again last night and to be on the panel. One of the points I was making (yes over and over again) is that free has a place. Free in itself is not a business model. It is one part of an offering and companies would do well to understand where it fits in to their overall offering. In my view, “free” should not be a cynical package designed to suck you in and upgrade you. Free should be a version of your product service that works for a subset of people that need to consume your product but who can never pay for it or who will use it to evaluate your product prior to paying for it. If you profile user bases and understand the value points to each segment you define, you can quickly identify what is useful/relevant to one segment that another will not need/care about. In our case, we understand why we have a free package, who it should be used for and what these value points are that mean that it offers just the right type of fuctionality for our “free” segment and means that our “Paid” segment understand why it will not work for them.
It is not always about giving more of the same when you pay either. If you truly understand how your target segment will use the service you are targeting at them then you will understand what it is they will pay for and what they won’t.

The other point I’d like to make is just because the marginal cost of supply has fallen to £0, that doesn’t mean that the VALUE has. It just means that a company can be more profitable. I don’t buy in to the argument that if marginal cost of supply = £0 then that should be passed on in its entirety. Web businesses are businesses and deserve to make money. They provide employment, valuable services, tax revenues etc. So with that in mind, companies whose sole offering is “free” should think about how they will make money from whatever it is they do. This takes time and is complex and in itself is a barrier to entry but is well worth figuring out in advance.

Finally, looking at newspapers, will we see the broadsheets becoming hardware manufacturers as a vehicule to distribute their new digital papers and to own the end user? Will all of them club together to go entirely online and cut out huge costs of production from their bottom line…

Thanks for listening.

]]> By: brisbourne http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4931 brisbourne Thu, 02 Apr 2009 11:13:16 +0000 http://www.theequitykicker.com/2009/03/31/freeconomics-maybe-people-will-start-paying-for-things/#comment-4931 Sorry Charlie - I thought I had Sorry Charlie – I thought I had

]]>