The Pros and Cons of Offering Free Content Online

Sunday, November 4, 2007 at 4:59am by Site Administrator

Popular bands such as Radiohead are now offering free (or pay-what-you-can) music online. Because of this, it’s been speculated that record labels are amongst the businesses facing extinction, along with newspaper publishers and possibly even desktop software producers.

The Internet has of course gone a long way in being a platform for delivery of such content. And with software that runs in a browser, what need will there be for paying for desktop software? Text and other media content also gets distributed from torrent sites, mostly illegally, in violation of copyright laws. So, whatever type of content you produce, you might be wondering whether you can go on charging for it.

Now, only the most immature of people believe that content producers as individuals (programmers, musicians, artists, writers, etc.) should not get compensated for their productivity. But when it comes to reality, not all content consumers behave this way. It’s easier to feel like you deserve to take free content from some big bad company that traditionally made millions/ billions – whether or not they’re now suffering financial losses.

So what do you do if you’re a startup without a financial history? Before I answer that, let’s look at some of the pros and cons of offering free content online, from the viewpoint of the producer.

Pros:

  1. Makes your target market happy, thanks to the freebies.
  2. Gets them talking, passing on the word – the makings of being viral content.
  3. Viral content can generate massive amounts of web traffic.
  4. Brings you to the attention of people that might not otherwise know you.

Cons:

  1. Brings you to the attention of people that’ll take your free content and never buy anything.
  2. The extra web traffic could boost your site hosting bill, and if you have no sales to show for it, you are not going to last long if you’re bootstrapping.
  3. Those who sample your free content might henceforth expect free content, all the time, and when it’s not free, might violate copyright and distribute it themselves (after they’ve purchased a single copy).
  4. Free content might alienate those without Internet access (about 3/4 of the world’s population), causing them to stop buying your “offline” product.

These may not be the only pros and cons, though they’re the ones that have been most prominent in my mind, as a retired programmer, an amateur composer, and a hopeful future filmmaker. The existence of free content on the Internet potentially impacts my livelihood.

Now, despite being a long-time Star Trek fan (but not a Trekkie), I don’t believe we’re going towards any sort of “free” model globally, for everything. At least not anytime soon. It’s far too complicated to get into that financial model across the world, even with about twelve years of the Internet’s (public) existence behind us. It simply goes against a thousand years or more of human thinking, with many unanswered questions to boot.

That means that for a quite a long time ahead of us, there will be people who will expect to pay for content, and even desire to pay for it. So back to my question: how do you deal with the current atmosphere of free content online, especially if you’re up against content producers who might be doing it for free?

This is a question I hope to explore here in the future.


If you enjoyed this article, please bookmark it at del.icio.us »

AddThis Social Bookmark Button

No Comments »

No comments yet.

RSS feed for comments on this post.

-->

Leave a comment