Differences Between Free and Five Cents

There’s a big difference between free of charge and any charge, no matter how small. That’s on observation often made about e-business. When it comes to the web, part of the difference arises from difficulties with micropayments. Another part arises from the way we think about costs; this part applies to even to the most tangible and familiar of objects.

Consider, for example, the plastic or paper bags given away by many stores, including supermarkets. They are no longer given away for free in Montgomery County, Maryland, where I live.

Montgomery County passed legislation… that places a five-cent charge on each paper or plastic carryout bag provided by retail establishments in the County to customers…

Montgomery County’s legislation, similar to Washington DC’s Bag Law, is designed to create an incentive for the public to reduce use of disposable bags by bringing reusable bags.

Will it work? I have evidence that it does. And by evidence, I mean anecdote: stories of my own behavior, and conversations at cash registers. I have gone back into the house to get shopping bags as I am about to drive to the store, then remembered that I’ll be charged if I get new bags. I am trying to keep a stock of bags in the car for the inevitable occasions on which I forget to grab bags from the house.

This effect isn’t due to the size of the difference: the five-cent difference between free and a nickel is bigger than five cents. Moreover, the directions of the five-cent difference matters. The local Giant supermarkets used to give five cents back for every bag a customer brought in. But the gain of five cents per bag wasn’t enough to make me bring bags to the store.

So there are two five-cent differences involved here. The loss of five cents per bag used affects my behavior, while a gain of five cents per bag rarely did. Those familiar with the concept of loss aversion shouldn’t be surprised. That said, I’ve been familiar with the concept for years, and I am surprised at how effective the five-cent penalty seems to be.

WordPress Winning By Being Free as in…

In the future of blogging, “the winner will be WordPress.” That’s the way it seems to Philip Leigh, writing at MediaPost (via WordPress Publisher Blog). Philip goes on to imply that blogging will be an important factor in the future of media.

He identifies two reasons for the success of WordPress: it’s free, and it’s free. He uses open source rather than free, or free as in speech, or GPL’d, to describe the second cause of success. The first cause is free as in beer, gratis, cost of zero, etc.

I refer to the MediaPost article, not just to quote it – it’s been fairly widely quoted already – but to remark on some of the questions it implicitly raises. In particular, consider the following.

WordPress is not merely a blogging tool. It’s a platform that can lead to an explosion of new media properties capable of text, video, audio, music, animation, interactivity, online merchandising, podcasting, and even social networking.

WordPress isn’t the only such platform. It isn’t the only such platform that’s both free and free. Drupal and Joomla spring to mind. So what is it about WordPress that will make it the winner? Is it the trajectory from simple blogging tool to rich publishing platform?

Social Media Thanks

Who or what are you thankful for in social media? asks Mashable Ben. I’m thankful for sharing, which is vital to social media in so many ways.

So much of the software is free/open source. So many of the web services are free as in freemium. So much of the content is shared via creative commons. So many people share their knowledge to help others via support forums and other channels.

The Free Bestseller

The bestseller in question is Free: The Future of a Radical Price. It’s by Chris Anderson, whose earlier book, The Long Tail, I posted about a couple of years ago.

Chris recently posted that Free made the New York Times bestseller list (number 12 on the nonfiction charts, to be specific). That of course means that there have been rather a lot of copies of the book exchanged for money. People seem willing to pay money in order to read about things being available at a price of zero.

There are ways of obtaining Free itself for free, within limitations of time and space.

The ebook and web book will be free for a limited time and limited to certain geographic regions as determined by each national publisher; the unabridged audiobook will be available free forever, available in all regions.

Whereas the unabridged audiobook is free, the abridged audiobook isn’t. Audible.com presents a “time is money” argument for the abridged audiobook being worth $7.49: it gives you the good stuff in half the time (3 hours rather than 6).

This may arouse the suspicion that the full Free is padded. My experience has been that business books often are. On the other hand, I found The Long Tail to be a book with a book’s worth of book.

So I’m going to read Free. The questions are: when? in what form? at what price? In a sense, I started reading Free over a year ago. I also started writing about it: one of the more successful posts on this blog applies Chris’ framework about free to WordPress.com.

I expect that Free will come out in paperback some time next year, with a new chapter or afterword. At that point, I’ll probably buy the paperback, just as I bought The Long Tail paperback.

Hardback publication is seen as perhaps the major event in a book’s lifecycle. In terms of my reading of Free, it’s the halfway point in a process that spans more than two years. No, that’s not because I’m a slow reader. It’s because the two most interesting publication dates are that of the Wired article (in 2008) and of the paperback book (in 2010?).

In case it isn’t already obvious, I find the Free project interesting in many ways, including its subject matter and publication process. And I like those old-fashioned things that tend to cost money: books.

Freedom and the Cloud

Cloud computing is a trap, warns GNU founder Richard Stallman. I advise reading the whole (shortish) interview-based article at the Guardian’s site. It’s less important to read my thoughts; be warned that they start in the next paragraph.

The trap is that, when you use cloud computing (e.g., WordPress.com, where this very blog lives, or gmail, where the andrew at changingway dot org mail actually lives), you have no control over the software you’re using. This is the loophole in GPL version 3, a project on which rms (Richard MathYou Stallman) and others expended a lot of time and other resources.

As 2008 goes on, that loophole becomes more and more significant as an attribute of GPLV3. So does the Affero variant on GPL.

What Does “How big is the free economy?” Mean?

The question was posed and addressed by Chris Anderson. By free, he means free of charge: that’s the focus of his book in progress.

Glyn Moody is more interested in free as in free/open source software (and genomics, and…). He points out that most of the free (of charge) economy is also part of the free (open source) economy.

What struck me is the extent to which the ecosystem that has grown up around GNU/Linux dominates everything else in this admittedly back-of-the-envelope calculation: $30 billion out of a rough $50 billion. Which confirms the extent to which open source continues to be the bellwether in this area – the first and still best example of how to make money by giving stuff away.

Both Chris and Glyn use money, and in particular the US$, as the measure of size. I’d be interested to see other measures of the free economy: person hours, people affected, etc.

Two Four-Letter Words: Spam and Free

Spam is, for many of us, the worst aspect of Web 2.0. The threat of spam of course creates an need, and hence an opportunity, for spam-fighting services. Last week, I compared four of them: Akismet, Defensio, Mollom, and TypePad AntiSpam. The comparison was prompted by the launch of the last of these (the list, like the comparison table in the previous post, is in order of launch date).

TPAS is interesting, not just because it is the most recent, but because it has claims to be the most free. I use the plural claims because TPAS seems to make that claim with respect to each sense of the word free: free of charge (gratis) and free (libre, open source) software.

In this post, I’ll extend the comparison between the four services with respect to each sense of free. First, free of charge. The last two lines of the comparison table refer to this kind of free. The first of these lines shows that each of the four services is free for personal use.

The last line of the table asks whether each service is free for commercial use. It answers “Yes” for TPAS, and “No” for each of the other services. Following some email exchanges and some thinking, it seems that the pricing issue needs clarification.

Akismet has multiple levels of commercial API key. For example, a problogger key is $5/month. Given that a problogger is defined for this purpose as one who makes more than $500/month, the cost seems reasonable (but then, I’m not a problogger). That an enterprise key starts at $50/month also seems reasonable (but then, I’m not an enterprise).

Defensio is free for commercial use up to a limited amount of traffic. That’s a paraphrase of an email. Defensio.com is down at the moment. I don’t know whether that means that the service is down.

Mollom currently describes its future pricing model as follows.

The basic Mollom service will be free… but it will be limited in volume and features… Our goal is to make sure that the free version of Mollom goes well beyond meeting the needs of the average site…

For large and mission-critical business and enterprise websites, we will offer commercial subscriptions. We are currently working out our commercial pricing scheme for access to more advanced features, unlimited traffic, enhanced performance, reliability and support.

TPAS, per its FAQ, “is free, and will always be free, regardless of the number of comments your blog receives.” The FAQ also addresses how Six Apart will support the service; the firm “may choose to provide enterprise-class services on top of TypePad AntiSpam at some point in the future.”

TPAS is the outlier on this “free as in beer” issue, but I now think that it’s closer to the others than I first thought and implied. Like the other three, it seeks to make money from enterprise clients (and I don’t see anything wrong with that). The difference is that it doesn’t attach the price tag to AntiSpam itself.

TPAS is also the outlier on the free software, or “free as in freedom,” issue. As I remarked in the earlier post, “while the TPAS inference engine is open, the rules are hidden.”

I wouldn’t be at all surprised to see Akismet, Mollom, or both move to a similar model. I base this on the following assumptions.

  1. Spam-fighting software has the classic intelligent system split between inference engine and rules base. In particular, Akismet and Mollom already have this architecture.
  2. The action is in the rules, which are specific to the domain of spam-fighting.
  3. Following from the above, you don’t give much away to spammers or to competitors if you free/open-source your engine.
  4. The people behind Akismet and Mollom don’t want to cede the “free high ground” to TPAS.

With respect to this aspect of free (libre), as with respect to the first aspect (gratis), I may have exaggerated TPAS’ outlier status. TPAS does have a legitimate claim to being more free than its competitors in each of the two senses of free. But the gap between TPAS and, say, Akismet, may not be as great or as durable as might at first appear.

That conclusion is, of course, my opinion. Comments (or email: andrew at changingway etc.) would be a good way of telling me that you draw a different conclusion or that my conclusion is based on faulty premises or reasoning. I’d welcome other relevant comments. For example, you might know of a spam-fighting service other than the four I’ve focused on.

Free Tags While Awaiting Semantic Web

MiracleTo start, we need to describe the semantic web. Definition: an evolving extension of the World Wide Web in which the meaning of information and services on the web is defined. When confronted with that, my brain flees to the comforting world of comics and to comfort from Sidney Harris. Thus calmed, it might be able to cope with video of someone far more semantically sage than I am: so I append a video of Tim Berner-Lee to this post.

For a concrete example, consider the word free. The languages and tools of Web 2.0 (or whatever number we’re up to now) are blind to the distinction between ‘zero price’ (gratis) and ‘freedom’ (libre). So the web itself cannot resolve the ambiguity.

The semantic web is the miracle that occurs between using the word free and having the web understand it. It’s the miraculous (to me) thing in some future cloud that enables me to write, without laborious distinction-drawing, one post about WordPress being free because it costs me no money to blog using it, and another about WordPress being free because I have the right to read, modify and distribute the source code.

One of the things I can do while waiting for the semantic web is to tag my posts. For example, when I’m writing about WordPress as free software (free as in freedom, free as in libre, etc.) I can use the tag opensource. Yes, I am aware of the argument that “Open Source” misses the point of Free Software. But opensource is effective because people looking for blog posts or other web content on free software may well, however grudgingly, search for the term/tag.

When it comes to the other sense of free (as in beer, as in gratis), I wish there was a tag likely to be as effective. I would welcome suggestions for a tag to indicate that I’m posting about free in this sense. And no, I’m not offering a cash prize for the best suggestion.

Now, to top off the tasty multimedia semantic sandwich, here’s Sir Tim.

Word of the Year: Free

It’s not yet March (check time: yes, we have another 23 minutes of this extra day of February, or at least, we did when I started this parenthesis), but I will state that the word of the year for 2008 is free. That’s free, not as in freedom, but as in $0.00.

Chris Anderson has just published an article in Wired explaining Why $0.00 Is the Future of Business. It’s a preview of the book he’s writing. As I’ve previously noted, the book won’t be out until 2009. I don’t know what the word of 2009 will be.

So back to the word of 2008: free. That’s how much I’ll charge you for these links.

Much though I consider Harlan and Alex to be worth reading, I find my own views to be closer to those of Neil and Chris.

Better Than Free

Kevin Kelly’s post Better Than Free has received much linkage. Nothing new here, sniffs Glyn. I think that’s a little harsh.

Kevin identifies and discusses eight things that are better than free (gratis, free of charge, that is, not free as in freedom). For example:

Patronage — It is my belief that audiences WANT to pay creators. Fans like to reward artists, musicians, authors and the like with the tokens of their appreciation, because it allows them to connect. But they will only pay if it is very easy to do, a reasonable amount, and they feel certain the money will directly benefit the creators.