Reviewed by Al Erisman
Free: The Future of a Radical Price by Chris Anderson. New York: Hyperion, 2009. xi, 274 pp.
Chris Anderson is the editor in chief of Wired magazine and the author of a best-selling book, The Long Tail. He was also the U.S. business editor for The Economist.
What would happen if an early prediction that electricity would be too cheap to meter, made at the time of the successful splitting of the atom, had come true? How would our economy look different? As a thought experiment, this would be a great exercise, though we know it did not happen.
But Anderson argues that another fundamental technology is rapidly approaching this point: bandwidth, processing power, and storage have dropped, and continue to drop, so significantly, that we might see the day when these are regarded as too cheap to meter. When products can be created digitally and can be distributed over the Net at virtually no cost, this changes the economics of many things.
It is not just computing that is impacted. Anything that can be put in digital form such as books, newspapers, and other media, also face very new economics. How do you run a business when the manufacturing process (digital copying) and the distribution process (over the Net) cost basically nothing?
It is this world that Anderson explores. He looks at why these things are true, and then looks at numerous business scenarios to see how they have been or might be transformed. How do you manage costs when a key resource is “free” is just one of the questions he explores. The usual process of saving and economizing is replaced by freely wasting that resource, as he urges us to do.
I was disappointed that he did little analysis on what went wrong with the dot-coms and the “new economy” from the 1990s. Because that era was proposing a version of Anderson’s free economy.
That said, however, this is a fascinating read. Even when you find yourself disagreeing with Anderson on his predictions, it is important to consider his arguments, because this is an area where almost every business must engage, at least at some level. Non-technology people in particular should engage in the ideas of this book because they are, by traditional standards, a radical departure from the old world. At least the questions he raises need to be considered.
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