In this time when all musicians should be engaged in the struggle to define a future model for career sustainability, I can’t help but fear that the FREE business models, ubiquitously held to be the future of music, media and just about everything else, will be an embarrassing footnote in recent industry history. Worse yet, I fear musicians and artists themselves, the willing subjects they always are (yet rarely the financial beneficiaries) will be no farther along in their pursuit of a security with their art.
In the late 90’s we had the Dot-Com Bubble. Hundreds, thousands of businesses all started in a Dot-Com gold rush. Few had any vision for how they’d be profitable. Most of my friends worked at these places, and they were caught up in it as well… stock options, initial public offerings, etc. They could collect a paycheck, a GOOD ONE, for a couple years, but only because of a misguided venture capital trend. When the whole thing came crashing down, they all lost their jobs, and the stock they hoped would be their retirement was worthless.
Flash forward, 2003 - 2007: The Real Estate Bubble. I watched my own home’s “value” quintuple, as did many of my friends in Philadelphia, particularly in Fishtown where I live. But “asking prices” weren’t any indication of true value; they were just a future bane for people who were unfortunate enough to pay these prices. ‘Another bubble, this time fueled by a misguided, criminally lax, even “predatory” credit market.
Our cultural appetite for all things FREE comes from the behaviors and attitudes of the aforementioned era. Paying with credit… It was pretty much like not paying at all. The economy ran on home equity loans and lines of credit, something far too few of us understood and it all came crashing down. The mad rush to start new businesses that run on FREE (and the equal frenzy to retrofit the old businesses to get in on the action) is just all of us clinging to this old behavior. It’s a cultural attempt to keep that spirit of (apparently) “inconsequential” hyper-consumption alive, in a brave new world where we can no longer run up credit to our hearts’ content.
So here we are: 2009, The FREE Bubble.
Most FREE business models will give away products and services with the hope of generating site traffic and advertising revenue. IF advertising proves effective - that is, IF people pay for advertising and, more importantly, IF the advertising WORKS over time, then everything will be fine. But the latter, especially, is one humungous “if”. I know I don’t see advertisements when I look at my desktop. People more sophisticated than I can block the stuff that really gets in the way, and as for the things in the corner, the things that look like advertisements? Our eyes don’t even focus on them. We just don’t see them.
God forbid, if this thin path to revenue fails, then what?
To entrepreneurs caught up in the hype, FREE is quickly becoming the new, apparently “necessary” cost of doing business, and it is driving up a specious, perceived value for businesses by the dozen. In a year… two years?… Will FREE businesses work, or will this simply be another bubble? Only time will tell. If it is, this one is on the backs of musicians, artists, and the value of their work. As always, they are the perennial, willing test subjects, but in almost all industry models, they remain the last ones in line.
