I’ve talked a bit in the past about the economics of free, and anyone who reads TechDirt knows that Mike Masnick has long been a proponent of these “new economics”. Mike recently gave an awesome presentation at mesh08 presentation called the The Infinite Good on this subject, making the case why free is not a bad thing and how it can actually make you more money. The video is available at rabbletv. Unfortunately, they allow you to embed but not link to a specific video. To watch, select “On-Demand”, choose “mesh Conference 2008″, then select Mike’s presentation. (via Rob, who also happens to be a co-founder of mesh).
When dealing with infinite supply, artificial scarcity is not the answer – limiting a resource shrinks the market. On top of this, infinite goods are much more prevalent in our digital world. The trick is to figure out how to use the infinite goods (i.e., the music that can be easily copied) to make the scarce goods that you control (i.e., the artist, the concerts) more valuable.