Jack Covert Selects - Free

Free: The Future of a Radical Price by Chris Anderson, Hyperion, 288 pages, $26.99, Hardcover, July 2009, ISBN 9781401322908 In 1954, Lewis Strauss, the head of the Atomic Energy Commission, declared the dawn of a new era. Diseases would cease to exist. Travel would be effortless. And electricity would become "too cheap to meter." Strauss's vision has yet to become reality, but Chris Anderson, in his new book Free, asks us to take a mental leap and imagine for a moment that electricity were free. All of our buildings would be heated by electric coil. Everyone would drive electric cars. Deserts would be turned into fertile fields with the water produced by massive desalinization plants powered by an energy source with no cost. Everything that electricity touched would be dramatically altered. Free electricity may be just a dream, but Anderson points to another area where free has become reality—bits. Moore's Law and its many corollaries describe the phenomenon that processing power, memory and bandwidth keep getting cheaper and, in fact, have already reached a point where they are too cheap to meter—the effects of which we are only beginning to see and feel. This is merely one sightline made apparent in Free. Anderson gathers history, economic theory, and thought-provoking examples from around the world to make one powerful point: Free is all around us. The free sample at your local bakery is just a cross-subsidy to encourage your purchase. The magazines sitting on your coffee table wouldn't get there on twelve-dollar subscriptions. Third party advertisers heavily subsidize their production and delivery (and your payment merely acts as a qualifier of your interest). The fastest growing model online is "freemium," in which software companies entice customers with a no-cost version of a product, adding more valuable features for those willing to pay. My favorite personal example of this is Prezi, an outstanding presentation tool that works completely inside your web browser. The service is free to use, but if you need more storage or the ability to present without an Internet connection, you'll pay a fee. Free needs to be on your summer reading list. Entire industries are in the process of being changed and, in the extreme case, destroyed by Free. As Anderson puts it, "Once you switch from shipping atoms to transmitting bits, Free become inevitable." How will the flow of free bits affect your business? Or, how can you use Free to help it prosper? Pick up Free by Chris Anderson and start figuring it out.