- By Jyotsna Pattabiraman

Malcolm Gladwell reviews Chris Anderson’s book, “Free”, in his review titled “Priced to Sell” for the New Yorker. As a premium content site, our money is quite definitely on Gladwell. To quote from the review,

“The only problem is that in the middle of laying out what he sees as the new business model of the digital age Anderson is forced to admit that one of his main case studies, YouTube, “has so far failed to make any money for Google.”

” So how does YouTube bring in revenue? Well, it tries to sell advertisements alongside its videos. The problem is that the videos attracted by psychological Free—pirated material, cat videos, and other forms of user-generated content—are not the sort of thing that advertisers want to be associated with. In order to sell advertising, YouTube has had to buy the rights to professionally produced content, such as television shows and movies. Credit Suisse put the cost of those licenses in 2009 at roughly two hundred and sixty million dollars.”

One needs to keep in mind that content creators need to be rewarded, too. If there is no incentive for them to make great films or serials, then all we are left with are “pirated content and cat videos”. As hard as it may be to believe, sometimes the spirit craves for something more than cat videos. We go in the opposite direction, believing the great challenge of our time is to reward content creators by making their content available for the right price to the right audience.

That’s not to say that free content has no role. Snippets of premium content, like trailers and songs, are among the most watched videos on the web. Like free samples, these types of snack content can serve as a “try before you buy” inducement, a clear statement of good faith and goodwill. But to say that the future of content itself is premised on this consumption pattern is going a bit too far.

One needs to go no further to refute Anderson’s argument than verifying the price of Anderson’s book, which is <gasp!> not free, but selling on Amazon for $17 and change. In fact, you won’t even get free shipping, unless you buy another book.

Update : oooo ! Web rock star Jason Fried thinks along the same lines as moi. Free is ..”the wrong direction for this industry”.  Check out his talk ( and text) via Carsonified at http://carsonified.com/blog/business/make-money-off-your-by-products/