Free And Paid
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Perhaps you think that Twitter today is a really cool and powerful company. Well, it is. But that doesn’t mean that it couldn’t have been much, much more. I believe an API-centric Twitter could have enabled an ecosystem far more powerful than what Facebook is today.Dalton Caldwell: Announcing an audacious proposal
Contemplate for a moment how scary a theoretical purely ad-supported Dropbox would be.Fred Wilson: In Defense Of Free
This post is in reaction to the idea that services should be paid to ensure that they are appropriately focused on the consumer/user as opposed to the marketer/advertiser/sponsor..... Think about the Super Bowl, the World Cup, the Olympics, the Oscars, the Presidential Debates, the news coverage of important events. These things are ad supported ..... The fact that at its base level TV is free does not mean that all TV has to be free. Free TV does not commoditize paid TV. They co-exist nicely. But we had free TV well before we had paid TV. Free is the foundation that creates a paid tier. ..... Why is over the air radio still the most popular way to listen to music? Because it is free. ..... let's look at servces where the users provide all the value. Wikipedia, Craigslist, YouTube, Flickr, Instagram, Facebook, Twitter, Tumblr, Wordpress, etc, etc. There is no value to any of these platforms if the users don't create the content. The users create the service, curate it, and make it what it is. I do not believe it makes sense to charge users to create the value. ...... When scale matters, when network effects matter, when your users are creating the content and the value, free is the business model of choice.Dalton Caldwell: Fred Wilson is wrong about “Free”
Companies like Facebook and Twitter have actively encouraged companies to think of their APIs as “platforms”. They want people to base their businesses on top of them. If you unpack that word, they are saying that you should think of the APIs they provide the same way you think of an operating system like Linux, or a hosting platform like Amazon Web Services, or a programming platform like Ruby on Rails......... Building on top of a platform is a foundational risk, and if your platform decided one day that it doesn’t like what you are doing, or likes what you are doing so much they want to compete with you, it’s Very Bad. ...... My arguments are that platforms should not be ad-supported. I never said that “free” is the wrong business model for everyone. ..... The vast majority of innovations created by digital music startups will be crushed because the labels have a fundamental financial incentive to do so. .... Attempting to create a huge platform business that is at its core about controlling and monetizing “bits” is a fool’s errand..... The propagation of “content” through our pipes is just the side effect of providing an amazingly useful service. In other words, content is not king– it’s just bits passing through our system, at the behest of our customers..... In my view of the world, digital “services” are valuable/easy to monetize, and digital “content” is not. If we think of Twitter and Facebook as communications platforms, rather than media/entertainment sites, it seems that their business models are on the wrong side of history.