More Blathering About The Beauty Of Free

James L. McQuivey, Ph.D. is a Vice President and Principal Analyst at Forrester Research. His recent op-ed on Mashable about the end of scarcity is interesting, if somewhat unintelligible.

What happens if the economics of scarcity are exchanged for the economics of plenty? For those industries that provide information or experience as a primary good, scarcity is rapidly evaporating. The media business is undergoing a similar change with the rise of citizen journalists, bloggers, and YouTube performers — all of which circumvent the traditional systems that once dictated production norms and processes. Most of these companies have sought to restore order by reinstating scarcity rather than celebrating its passing. It’s not a good sign of things to come.

…The best ideas, no matter how small or underfunded, have the largest potential impact, and a company that gives its value away may stand to gain more value in return. As a result, companies like Facebook and Google are writing the book on how to manage the economics of plenty, even if they don’t know it.

I respect the idealism in this thinking, but practically speaking, I’d like to know much more about “the company that gives its value away” coming out on top. I do understand how a company can amass a large audience by offering a free service–it’s the model Google, Facebook and Twitter (to a lesser degree) have used to build their highly profitable ad-based businesses. But an ad-based online offering will need massive scale to succeed. Without that scale, the business needs another way to make money.

I’d like to know more about the concept of scarcity, as well. I know there are many who would say that what we do here is a commodity, that it can be had elsewhere, so we’ll never be able to charge for it. I might be totally delusional on this topic, but I don’t see it that way. The work that writers and editors do–if it’s any good–is never a commodity. A unique point of view and a distinct voice are, by definition, the opposite of commodities.

About David Burn

I wrote my first ad for a political candidate when I was 17 years old. She won her race and I felt the seductive power of advertising for the first time. Today—after working for seven agencies in five states—I am head of brand strategy and creative direction at Bonehook in Portland, Oregon.