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Pierre M

Congratulations America

“we will extend a hand if you are willing to unclench your fist”

Wow!

Congratulations America.

Pierre M

The Case for Free Payment

the-case-for-free-payment

First of all, I want to insist on what Free Payment is not. Free Payment is not about charity, kindness or generosity.

For the consumer of Free, it is first and foremost a selfish business act. The consumer pays to secure his future happiness. Because he loves the product and he is wise enough to understand that he needs to contribute if he wants the producer to make more for him to enjoy.

For the producer of Free, accepting free payments is not panhandling. Free payments are deserved remunerations for the producer’s work, even more merited since the consumer freely chooses to pay. It is a sign of approval and an encouragement to pursue.

A free payment is a business transaction. It is a transaction based on love, passion, wit, and above all, freeness, but a business transaction nonetheless.

This being said, I want to elaborate on the staggering advantages of a Free Payment culture for consumers, producers and societies.

For the consumer of Free:

  • The consumer is free to choose which producer to pay, and which not to pay, whatever his reasons are. And in all cases, he can still enjoy the content or the service freely.
  • The consumer chooses to pay only for what he values from the maker. He can choose to pay for a copy, a performance, a service, for a future product or for the overall work of the producer.
  • The consumer is free to choose how much to pay. He can pay a suggested price, according to market value or according to his own perceived value. He is free to take into account his own capacity to pay.  For any reason he might have, he can choose to pay less, or more, with no need for justification.
  • The consumer is free to pay any time he wants. He is free to pay now, later or never. He can choose for example to postpone payment until he can afford it, or spread out payments in time.
  • The consumer can choose to pay for his own reasons. Because he loves the product or because he respects the maker. It may be a way to congratulate or to encourage him, or because he feels the producer’s work is important for him, for the community or for the world.
  • Through a community, the consumer gains the power of life and death over the destiny of the producer of Free. With Free Payment, he acquires the ultimate tool to exert its power and influence over its economic space. It opens up endless opportunities for consumers willing to get involved into the producer’s business.
  • The consumer will gain an almost unlimited choice of contents and services. Because Free Payment greatly contributes to a profitable Long Tail economy, the consumer will benefit from unparalleled market diversity.

For the producer of Free:

  • Free Payment is by far the easiest and cheapest business model to implement on the Internet. It allows for a very low market entry cost. A producer can post his writing on a blog, his video on YouTube, his picture on Flickr, his music wherever, and get payment from PayPal. Minimum up front investment required. Minimum overhead.
  • Free Payment gives the producer the opportunity to eliminate middlemen from his business process. Since Free Payment allows for a direct link with consumers, it enables the producer to optimize its cost structure and provide the lowest cost content and service to his community.
  • The Producer is free to make his work available under copyleft licenses, and thus fully embraces the Free Culture ethos. With Free Payment, the producer of Free does not need to care about copyright infringement, DRM or other legal and technological protection for his work.
  • Free Payment allows for a much more leveled field of opportunities for all types of businesses and products, even the more specialized one. With the enormous Internet market, a producer can hope for decent revenues even if his product is located far out in the niche end of the Long Tail.
  • The producer gains the resources of a committed community of True Fans. A community of people who care enough to freely contribute to his work. Properly nourished and fostered, such community of dedicated fans can provide real value in ensuring the producer’s business growth and prosperity.

For the society:

  • Free Payment is an opportunity to eliminate valueless activities from business processes. Since Free Payment favors direct transactions between producers and consumers, it can greatly contribute in optimizing supply chains for digital goods and services.  This means a more efficient economy, less resources consumption and lower environmental cost. Free Payment together with the Free Culture is an environmentally sound economical model.
  • Free Payment can contribute to a better distribution of wealth. Because people are less likely to pay someone perceived as “rich enough”, it will enable consumers to reroute their consumption budget toward more marginal producers. Free Payment is an opportunity to have fewer millionaires but more people able to get a decent living from their work.
  • Free Payment business model can greatly contribute to fight poverty and help developing countries. Because of its very low market entry cost, it offers more equal opportunities to a much greater part of the world population.

Finally, for the rebel minded people, it is a way to short-circuit an economic system often seen as unfair and inefficient, a system mostly at the hand of an overpaid privileged corporate elite. To use Saul William words, it’s a way of check-mating capitalism.

Surely, this economic system is based on integrity and wisdom. These qualities must be common enough through the Internet community for Free Payment to be a successful model. I strongly believe they are. The best proof is that there is already a thriving Free Culture out there. Wikipedia, Linux, Firefox, they are all very successful products of this ethos. And Free Payment is already playing an important and growing role in this culture, almost unnoticed. Call it donation, patronage or sponsoring, it’s the same fundamental idea. It only needs to be further fostered and promoted.

Free Payment is the key to the realization of a sustainable gift economy of Free in the digital world. It is often said that, in a gift economy, people are judged less on what they own and more on what they give. This is quite an exciting and promising new paradigm to explore for our societies.

Pierre M.

The Process of Free: The Missing Link

(translation in French here)

As it is now common practice to clarify when talking about such subject, this text is about free as in speech, not free as in beer. But, since the Free (as in speech) of the internet has a strong tendency to become free (as in beer), it often also applies to the latter.

From the beginning, the internet has been struggling to find its economic raison d’être. By allowing digital goods to be copied freely and at merely zero cost, it gave a blow to traditional business models, mostly based on selling copies. Since then, no alternate economic model seems to be able to fill the gap.

Advertising has long been thought to be the solution. It was the first model to emerge and to achieve a significant success. And it has been since then the main economic propeller of the web.  But as impressive advertising revenues growth are, this model alone is in no way able to fulfill the economic needs of the current internet planet, much less to be a guarantor of its future. The quantity of contents produced by “amateurs” who cannot or do not seek monetary gratification is already huge and it’s growing extraordinarily. It is impossible for the advertising model to sustain such growth and diversification.

Other business models have been used with some success. Like the Freemium model (a few people pay for the enhanced product, subsidizing the many others who get the basic product for free).  But again, like other models based on selling some sort of copies, it is inefficient, unless you restrict the ability of your product to be copied.

The internet is a complex animal whose metabolism is based on Free. Any attempt to restrict freeness is condemned, if not to failure, to hopelessly squander resources to fight the natural tendency of the Internet of Things to revendicate this freedom. This is why all efforts to enforce copy protection have proven difficult, when not impossible. DRM and other copy protection mechanisms are dead ends in the digital world because they go against the fundamental nature of the internet, the free circulation of data.

The internet is the realm of the Free.

But, as economists like to say, there is no free lunch, not even in Cyberspace. So, how can you make money with Free stuff?

There are many promising solutions currently being explored. Kevin Kelly’ texts Better Than Free and 1,000 True Fans are the best reflections on the subject I know of. He defines 8 “generative” values that can be exploited in a world of Free. Most of them are already being used to some extent, like “findability” (iTunes, Netflix), others are barely exploited.

But so far, none of these models seems to possess the potential to successfully propel the internet into the much announced new digital economy era.

Wait, maybe there is one.

In another life of mine, I used to do consulting work in business process reengineering. The first step when one wants to examine a process is to chart it. So let’s chart the economic process of Free.

If you look at this diagram, there is one clear conclusion. In order for this process to be economically viable, you need to close the loop and provide some kind of value exchange from the Consumer of Free to the Producer of Free. This is obvious and only restates our original problem: how can we close the loop and give a smile back to the producer?

Some might argue that since a Producer of Free is almost certainly also a Consumer of Free, he gets some payback by taking advantage of other’s Free contents and services.  Like in a Gift Economy. It is all true and good, except that this doesn’t put more money into his pockets (although it may help).

If you look again at the diagram from a very high perspective, there is one obvious label for the missing link that readily comes into mind.

Free Payment or payment libre. A payment that the consumer is free to make, or not to make. A payment free of any mandatory value. A payment libre of any constraints.

The Free Payment model is an intuitive, natural, elegant and simple solution to the Free Culture economic dilemma. So much that it’s already all over the place and used since the origin of the internet. It is called patronage, donation or sponsoring, but it’s exactly the same idea. And it’s growing steadily, almost unnoticed.

Because people want to pay.

Those arguing that people will never pay for something they can have for free, grossly underestimate humankind intelligence and common sense. Because it is only common sense to pay for something you use and enjoy. This way, you make sure there will be more in the future. You secure your future happiness. It is the clever thing to do, in a selfish way. Doing otherwise will end up inevitably killing the creation of Free, and people are wise enough to understand it.

But Free payment is above all a question of passion and love. Love for an artist, for a writer, passion for a community. It is “a way of connecting, a sign of approval, a vote, it indicates an allegiance with the maker, and it feels good to the payer“.

I strongly believe that Free Payment, together with “Better Than Free” generatives, represents a solution, if not the only solution to the economy of Free. Because it respects and reinforces the ethos of the Free Culture and of the internet. It is a way to concretize the promises of the Long Tail. A way to give hope and relief to the countless creators of the web. A way to sustain and defend the unprecedented explosion of creativity and inventiveness triggered by the internet. It is at everyone’s interest, producers of Free and consumers of Free, all Netizens.

And it just needs to reach a critical mass of participants to become a real economic revolution.

For this to happen, the culture of Free Payment only needs to be marketed and fostered, because the seeds are already there. Many people give their time, talent, creativity and money into the economy of Free. It is called Open Source, Web2.0, Online Communities, Blogs, Wikipedia… and Free Payments, all part of the Free Culture revolution.

Free Payment might be the missing link toward the realization of a thriving and sustainable Gift Economy of Free. Because Free Payments are truly gifts.

Some might say that gift economies are pure utopias.

I know of a bunch of utopian people who, once a year, create an amazing gift economy society, out in a remote desert of Nevada. And they build pretty incredible things. It is called Burning Man.

They know and I know that utopias are quite often very possible futures. It only depends on us.

Pierre M

See also: The Case for Free Payment

Digg!

Cloud Computing, an opportunity for the environment?

One of the hottest topics these days on the internet technology front is the irresistible raise of Cloud Computing. There is not a week that goes by without some  kind of news on the subject.  For those who still don’t know what this new buzz word is all about, Cloud Computing is essentially a new paradigm where data and software do not sit anymore on the end user computer, but reside in a “cloud” of servers somewhere in the network.

Several major industry players started to place their pawns on this foreseen huge emerging market and a new breed of start-ups is jumping on the wave. Mega data centers are being built and cloud applications are already common, more and more ready to replace good old Uncle Bill’s stuff and to do much more.

One of the many possible impacts Cloud Computing may have on our digital consumption habits will be on the kind of devices needed to access data and applications in the Cloud. Full fledged all mighty computers won’t be essential anymore. Simple devices, with high-speed communication, display and input interface, a bit like the terminals of the mainframe era, will be very much enough. And this kind of devices is already coming stronger and stronger into the market.

Not only we would not be forced anymore to invest ridiculous amounts of money on computers which capacities are most of the time barely exploited, but more importantly we would be a lot less the hostages of the technological obsolescence that has been the norm since the first IBM PC. You know, the kind of planned obsolescence which forces us, digital consumers, to change computer every few years just to keep up with technology’s “improvements”?

With Cloud Computing architecture, it is the Cloud that has the pressure to sustain the technological pace. As long as a “Cloud Terminal” is able to communicate, display information and interface with the user adequately, it is all that the consumer needs to use Cloud Computing. It is a lot more conceivable to design such device with good provisions against technological obsolescence than with the traditional PC paradigm. The industry only needs to agree on few standards that will be suited for several years. This might not be easy but it is nonetheless feasible.

Some might say that I’m excessively optimistic and that big evil corporations will still find ways to force consumers into constantly changing and upgrading their cloud computers? This is most probably true. Still, it is an opportunity.

It is an opportunity for consumers, and maybe more importantly, an opportunity for the environment. Our consumption society made a lot of progress towards recycling which is very good. But it is far more efficient to try to solve the problem at the source, and stop using hardware, full of toxic and unrecyclable waste, that has to be systematically thrown away after a few years only.

Like it or not, Cloud Computing is here to stay and its future looks bright, for the best and for the worst. By allowing consumers to be set free from the insane obsolescence pace of the traditional computer market, Cloud Computing offers a rare opportunity to make a small but significant step towards a more sustainable economy.

I really hope our society will seize this opportunity. For the good of our planet and for the good of our future.

Pierre M

The Hidden Power of the Web

The real power of the web can only be unleashed if we embrace its apparent inconveniences.

The full potential of the internet revolution our society is currently experiencing, and above all the untapped potential that we are still unaware of, can only be realized if we completely let go and embrace the apparent disadvantages that come with it. By “potential”, I refer not only to the technology, like the eluding Web2.0 or the much talked about Semantic Web, but above all the usefulness that can be achieved with these technologies.

As web citizens, we will have to accept some compromises, or what seem now like compromises, in order to get the full benefit of this revolution. Some of these compromises will be more difficult to accept than others, like the ones regarding our privacy. But it is the price to pay, and we will manage it just like we did in the past. We may not realize it, but regardless of the internet, our so called private life in our modern, centrally managed and closely controlled society, is a lot less private then it used to be not very long ago. Our great-grandparents would probably have been very uncomfortable with the kind of private life we claim to have these days. Along with this apparent erosion of privacy, institutions and watchdogs were created to ensure that our private data was used in a manner ethically acceptable to most of us. We managed and got used to it. Now it is natural. And that is what we need to do with the internet revolution: embrace the change but harness it. I’m confident that most people will agree at the end of the road that it will have been worthwhile.

Because the internet can change our society in a more profound and beneficial way than we can imagine. I deeply believe that it can help us make this world a better place. How exactly? I’m not sure. What I do know is that information and knowledge gives power. And, since the internet means more information and knowledge, the internet ultimately gives more power to the people. The web possesses the potential to profoundly change the economic and political balance of power in societies.

Furthermore, it will help us grow along the way. It can help us, as a society and as individuals, to become more mature and wise. Because we all need to become wiser in order to thrive in this new communication era. The internet is not for dummies. Among other things, critical thinking toward information, responsible digital consumption and digital community involvement need to become second nature to future web citizens. It is at these conditions only that this technology will be beneficial to humanity.

I realize that this scenario is far from being the only possible outcome. Countless pitfalls lay ahead. We may not succeed in becoming wiser; ruling classes may take control of the technology for its own profit; and the web could become just another tool of repression and alienation to the human race, and a powerful one indeed.

For one of the rare time in human history, we have at our disposal a tool enabling us to exert considerable power over the outcome or our future. It is up to all of us, web citizens, to seize this extraordinary opportunity.

Pierre M



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