Migiwe

As it is now common practice to clarify when talking about such subject, this text is about free as in speech, not free as in beer.

From the beginning, the internet has been struggling to find its economic raison d’être. By allowing digital goods to be copied freely and at merely zero cost, it gave a blow to traditional business models, mostly based on selling copies. Since then, no alternate economic model seems to be able to fill the gap.

Advertising has long been thought to be the solution. It was the first model to emerge and to achieve a significant success. And it has been since then the main economic propeller of the web.  But as impressive advertising revenues growth are, this model alone is in no way able to fulfill the economic needs of the current internet planet, much less to be a guarantor of its future. The quantity of contents produced by “amateurs” who cannot or do not seek monetary gratification is already huge and it’s growing extraordinarily. It is impossible for the advertising model to sustain such growth and diversification.

Other business models have been used with some success, such as the Freemium model.  But again, like other models based on selling some sort of copies, it is inefficient, unless you restrict the ability of your product to be copied.

The internet is a complex animal whose metabolism is based on Free. Any attempt to restrict freeness is condemned, if not to failure, to hopelessly squander resources to fight the natural tendency of the Internet of Things to revendicate this freedom. This is why all efforts to enforce copy protection have proven difficult, if not impossible. DRM mechanisms are dead ends in this digital world because they go against the fundamental nature of the internet, the free circulation of data.

The internet is the realm of the Free.

But, as economists like to say, there is no free lunch, not even in Cyberspace. So, how can you make money with Free stuff?

There are many promising solutions currently being explored. Kevin Kelly’ texts Better Than Free and 1,000 True Fans are the best reflections on the subject I know of. He defines 8 “generative” values that can be exploited in a world of Free. Most of them are already being used to some extent, like “findability” (iTunes, Netflix), others are barely exploited.

But so far, none of these models seems to possess the potential to successfully propel the internet into the much announced new digital economy era.

Wait, maybe there is one.

Let’s chart the economic process of Free.

If you look at this diagram, there is one clear conclusion. In order for this process to be economically viable, you need to close the loop and provide some kind of value exchange from the Consumer of Free to the Producer of Free. This is obvious and only restates our original problem: how can we close the loop and give a smile back to the producer?

Some might argue that since a Producer of Free is almost certainly also a Consumer of Free, he gets some payback by taking advantage of other’s Free contents and services.  Like in a Gift Economy. It is all true and good, except that this doesn’t put more money into his pockets (although it certainly helps).

If you look again at the diagram from a very high perspective, there is one obvious label for the missing link that readily comes into mind.

Free Payment or payment libre. A payment that the consumer is free to make, or not to make. A payment free of any mandatory value. A payment libre of any constraints.

The Free Payment model is an intuitive, natural, elegant and simple solution to the Free Culture economic dilemma. So much that it’s already all over the place and used since the origin of the internet. It is called patronage, donation or sponsoring, but it’s exactly the same idea. And it’s growing steadily, almost unnoticed.

Because people want to pay.

Those arguing that people will never pay for something they can have for free, grossly underestimate humankind intelligence and common sense. Because it is only common sense to pay for something you use and enjoy. This way, you make sure there will be more in the future. You secure your future happiness. It is the clever thing to do, in a selfish way. Doing otherwise will end up inevitably killing the creation of Free, and people are wise enough to understand it.

But Free payment is above all a question of passion and love. Love for an artist, for a writer, passion for a community. It is “a way of connecting, a sign of approval, a vote, it indicates an allegiance with the maker, and it feels good to the payer“.

I strongly believe that Free Payment, together with “Better Than Free” generatives, represents a solution, if not the only solution to the economy of Free. Because it respects and reinforces the ethos of the Free Culture and of the internet. It is a way to concretize the promises of the Long Tail. A way to give hope and relief to the countless creators of the web. A way to sustain and defend the unprecedented explosion of creativity and inventiveness triggered by the internet. It is at everyone’s interest, producers of Free and consumers of Free.

And it just needs to reach a critical mass of participants to become a real economic revolution.

For this to happen, the culture of Free Payment only needs to be marketed and fostered, because the seeds are already there. Many people give their time, talent, creativity and money into the economy of Free. It is called Open Source, Web2.0, Online Communities, Blogs, Wikipedia… and Free Payments, all part of the Free Culture revolution.

Free Payment might be the missing link toward the realization of a thriving and sustainable Gift Economy of Free. Because Free Payments are truly gifts.

Some might say that gift economies are pure utopias.

I know of a bunch of utopian people who, once a year, create an amazing gift economy society, out in a remote desert of Nevada. And they build pretty incredible things. It is called Burning Man.

They know and I know that utopias are quite often very possible futures. It only depends on us.

This entry was posted on Tuesday, August 31st, 2010 at 23:47 and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.