Malcolm Gladwell Disses Chris Anderson: Free Smackdown!
The battle of pop sociologists just got a lot more interesting: in the latest issue of New Yorker magazine, Malcolm Gladwell does a fisking of Wired editor Chris Anderson’s new book “Free”, the book about the future of pricing and the value of IP (and by definition business models) in a digital world. Anderson’s iron law: “In the digital realm you can try to keep Free at bay with laws and locks, but eventually the force of economic gravity will win.”
Gladwell’s main take: that free isn’t what everything is moving towards, and building a business on it is not as simple, due to other factors involved. “There are four strands of argument here: a technological claim (digital infrastructure is effectively Free), a psychological claim (consumers love Free), a procedural claim (Free means never having to make a judgment), and a commercial claim (the market created by the technological Free and the psychological Free can make you a lot of money). The only problem is that in the middle of laying out what he sees as the new business model of the digital age Anderson is forced to admit that one of his main case studies, YouTube, ‘has so far failed to make any money for Google’.” Because driving pricing economics multiplied by exponential audience growth still makes up a very large number. That plus the real economy just took out the bottom out of the “free” economy.
