Wednesday, July 8, 2009

Information wants to be Free, until it Doesn't.

Some people think the Internet is infinite. The Internet it not infinite; but it's infinite up to a point. But where is that point? The model for the Internet is much like the model we have of the universe, that it's currently expanding. But this model for the universe foresees a time when expansion will cease.

Just as the rapid expansion of the universe created clusters of matter, the Internet's expansion will slow to create systems of content and content providers. And as these masses form, and we can quantify the useful, habitable, areas, the smaller bits of stuff will drift off to become virtually non-existent.

I think the proliferation of smartphones and netbooks and web apps and gadgets will help to create these masses and force the content creators to charge. Up to now, Internet browsers have been free for laptops and desktops, but what about smartphones? All these apps that download specialized content aren't free. For example, why should Apple make money selling an app that downloads content from my site while I provide that content for free? Or while Google provides the site for me to provide the content that the iPhone users enjoy.

People believe that you can always make more Internet. But for what reason? Will it make money? If so, when? The Internet is free because very few people are making money by charging for it. But I see a time very soon (5-10 years?) when all that free will be gone.

Look at Geocities. Yahoo! bought that with some long-term profitability in mind. But it never happened, so Geocities is getting wiped. Thousands of homesites scattered into electrons.

What about Blogger? Google has never forced Blogger users to pay a fee. But what happens when technology changes? What happens to all the free stuff when Google finishes its own OS and and Google's netbooks and Android phones are as popular as Apple products? What happens when Apple and Google become the Coke and Pepsi of the Internet? Sure, we still have RC Cola and Faygo, but Coke and Pepsi influence all soft drink pricing. Coke is never on sale the same week as Pepsi. Is there collusion in price controls? Dunno, but did you ever notice just how crappy the third-tier soft drinks taste, like Wal-mart cola? Like there's an industry-wide conspiracy of mediocrity to keep Coke and Pepsi on top? Companies are on top for reasons which go beyond the product. How hard could it be to copy a cola flavor? Or a hamburger? (I was going to add Microsoft, but then my Coke-Pepsi analogy would have to change to a McDonald's, Burger King, Wendy's analogy, and I was too lazy to do the rewrite.)

I think newspaper syndicates and information providers and social networking sites will begin charging for content soon. As soon as they all agree that it's time. Consolidation, price stabilization, these things will force the free out of business.

It's like the historic American West when land was free for the taking, as long as the government moved the Indians away. Remember that much of the Internet is just like land. It's land that we work and make productive, but we don't own it. I don't own my Facebook page or my Blogger blog or my Twitter account; I just work it and try to produce something that makes those companies some money. I work the land. And for now, it's still the land of the free.