Skin in the Game: 5 Reasons the Free Economy Doesn’t Work For Me
As we approach the end of October and I look back on 2009 I think there is one lesson that stands out from the rest for me: The “Free Economy” has its drawbacks.
I’m not speaking specifically about the web here, though you certainly see many examples of the Free Economy on the Internet. This is a more general statement about how we interact with each other, the value we give things and the commitment we make to others (and the commitment we accept from them).
From my experience, here are five examples of ways the Free Economy generates a less than stellar exchange:
1. It’s too easy to join
Quick, how many Social Networks, newletters, websites and ‘exclusive societies’ do you belong to right now? I’m guessing you’d need at least both hands to count them. You probably didn’t even think twice about joining them or ask yourself what real benefit you’d gain once you did. Now most of these emails just clog your inbox, you probably don’t even open many of them anymore, you just delete them. And when was the last time you made a real contribution to that group you were so excited to join on LinkedIn nine months ago?
2. It’s too easy to quit
Which of course leads us to the flip side – it’s too easy to quit. Maybe you realized that the group you joined would require some effort on your part. Or you get tired of automatically deleted all those emails. So finally, one day, you decide to take the time to unsubscribe to all these things. As you do so you think to yourself, “I know there was a reason I signed up for these in the first place.” But without any financial connection, it was just too easy to let things slide.
3. Free creates weak communities
When it’s free to join and free to participate communities become weak. This happens in a couple of different ways. As noted above, it’s too easy to join and you end up with people who aren’t really committed to the cause. They are joining on a whim. Soon you’ve got a lot of dead wood, look at all the people who join Twitter, and then never tweet. The next phase then is quitting which is easy as well, and soon you have a community filled with people flitting in and out, not contributing to the cause, yet still taking up administrative resources.
The other drawback is that it creates an environment for trolls. Take a look at popular YouTube posts, or trending topics on Twitter. They are filled with spammers and trolls mucking up the system. If these people had to pay $5 every time for the privelage of writing, “Get rich using Twitter, ask me how [insert link]” we’d see a lot less of that type of stuff. In this case it may not even be a matter of money. A simple username and password system can be enough of a ‘cost.’
4. Free devalues the product
On a couple of occasions this year I’ve asked friends for a “favor” that included they provide me with a good or service that is part of their livelihood. Maybe I offered some sort of weak barter in exchange, but in retrospect, shame on me. If I valued their talent, I should have offered to pay them the going rate for their services, and if they demured I should have insisted. Once you ask for a “favor” you relinquished all your rights as a consumer. If it isn’t quite what you were looking for that’s too bad, you can’t ask for revisions, they are doing you a favor. Are they not meeting your deadlines? That’s too bad, they are doing you a favor after all.
It works in the other direction as well. If you are asked for the favor, sure
Ok, yes, some things should be free
you want to be a nice guy and say yes, even if it’s not quite up your alley. Then, a couple of days later you realize this isn’t a project you really want to work on, or you have other paying gigs that take precedent. Pretty soon you start dreading this “favor’ you agreed to. Now everyone is a loser as you aren’t going to do your best work, and your friend isn’t going to get what he wants either.
5. Free creates work of lesser quality
It’s very easy to fall into the thinking of, “Hey, nobody’s paying for this, it doesn’t have to be perfect.” When you create something, whether a community, a good or service, when people aren’t paying for it, you as the creator have an out. It’s going to be hard for people to yell at you regarding the quality because you can always fall back on the ‘you get what you pay for’ retort. Expectations – of yourself, and from the consumer – are lowered in a free transaction. It can work if it is something you are wildly passionate about, but otherwise the quality will suffer.
I’m not some sort of arch capitalist who thinks every last dime needs to be squeezed out of every opportunity, but putting up even some small economic barriers can address many of these issues. I hope that in 2010 I’ll be more thoughtful when it comes to the type of things I decide to participate in and how I ask others to participate in my efforts.
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