Jesse James -( the custom motorcycle maker, not the 1800's outlaw)- has a tattoo on the palm of his hand which reads 'Pay up Sucker' around a $100 bill. Why? because even in his small specialized client base there are people who want his services for free. When viewed from the perspective of individual businesses against an industry the effect appears insignificant, take a macro view and free can be a killer. Philippe Bradley (who writes in sheer genius form) made me aware of the 'freevirus' concept in a post on Fred Wilsons blog in a post entitled "Triangulating For Insight"
Using Darwinian evolution as a metaphor for Venture Capitalists’ role in developing startup companies, Mr Bradley introduces the concept Freevirus coming about when startups who have a building subscriber base get attacked and usually destroyed by 'competing' services who offer free what the startup charged for. Once the virus is let loose it usually takes down all around it and in fairly short order begins to run out of hosts. If a freevirus upstart manages to destroy or weaken the original hosts it must find something to sustain it - usually ads. The end result is less choice as the startups who had financial backing and an economic model for sustainability and innovation are killed off and the FV upstarts are thinned due to lack of sustainability. (I cannot do the original post justice you must go read it).
And yet, it is the freevirus's action which brings in the mass market acceptance, draws in those beyond first adapters. As a service transitions from niche tool of the uber chic to general ubiquity the freevirus version suffers through the invigoration and stresses of meeting the demands and criticisms of users. New tools are developed and added as suggestions and demands are stated. So, freevirus can often act in a symbiotic manner - for a short time. As my wife is fond of stating, "Oh Honey, nothing really comes for free...".
Can freevirus be harnessed into a benign catalyst? Prior and current examples are inconclusive,
Microsoft floated the idea for a way to prop up the struggling Zune platform, with the expected backlash.
No Ads on my Zune please:
http://news.cnet.com/8301-13526_3-9948849-27.html
.
One model is to provide services or content which the freevirus cannot match or have available.
Frustrating the Pirates:
http://www.nytimes.com/2008/05/17/technology/17online.html?partner=rssnyt&emc=rss
.
What does it mean when even the uber techies -(many of them VC's who struggle with this question)- balk at paying for the much heralded Twitter?
Will the Tweets pay for their Tweets? Nope.
http://news.cnet.com/8301-13505_3-9950085-16.html
Even large infrastructures cannot find the funding to keep subsidized toplogies up and running.
Say goodbye to Muni-Fi
http://www.infoworld.com/news/feeds/08/05/16/Say-goodbye-to-Muni-Fi.html
Why are we so averse to advertising which can subsidize content, keeping the cost low or free? The legitimate Question of whether advertisers could have any direct control of content is a serious one. (No more clear channels please!).
Why do so many insist that all content should be their right not a privilege to obtain?
Why are you a freevirus carrier ?
No comments:
Post a Comment