Sunday, November 22, 2009

All The News That's Fit To Print for ME!

There is an innovative and simple solution to the collapse of the business model of traditional media. The question is whether the old media incumbents will see it and adopt it before they fully collapse or if it will be new entrant players who see it first and take the leap of offering it. The solution is coming it's just a matter of time and who see's it and implements it first. So what is that solution? 

Simple: Give me EXACTLY the information I want, EXACTLY when I want it and I WILL PAY YOU FOR THAT. The future is all about custom/personal information filtering and delivery. Clay Shirky's now famous statement in his, "It's not information overload, it's filter failure." presentation sums up the problem and points at the solution. 

So why is nobody rushing to give me that solution? I'll tell you why. Because it's scary for the incumbents to fundamentally change how they gather and distribute information and it's expensive for new entrants to build and migrate people over to a world-changing information delivery solution. This is always the greatest wall holding back any fundamental change that needs to happen.

But, make no mistake,  this is an idea whose time has come. News media companies are in panic and Information overload has already reached a point where many people are suffering info exhaustion. Given the chance, many will now pay some amount for a service that effectively filters the "info-verse" in a custom way and delivers it to them in a custom way. I know I would. Between Email, IM, RSS, Twitter, Facebook, LinkedIn, Foursquare, Pearltrees, TV, Radio and yes, the occasional newspaper, I am drowning in too much information. What I want is a single, one-stop service that delivers me "All the News/Blogs/Tweets/Music/Videos/Friends That Are Fit To Print/Show/Stream/Deliver/Introduce for or to (Roger Toennis)". 

I WANT TO PAY for a service that Data-mines the web continuously getting, prioritizing and spoon-feeding to me all the info relevant I need to be "dialed in to the what's happenin' on the web and in the world" without me having to do all the work of setting up and tweaking the filters. I also want the service to mine the people networks and find people I need to meet based on my networking goals and and make the introductions for me(us).

In addition I want an option to pay extra to have a real, live, breathing, human person who works for this service to send me personalized voice/video/text notes telling me why I need to read certain articles, watch certain YouTube videos, TV shows or movies. They would also tell about people I should meet and then introduce me to them perhaps even in a live call or video chat when the other person agrees to meet me. When this service is available I will pay up to $200 a month for it, maybe more, if it includes the live-personal-assistant-like features.

Help me surf the information tsunami and hang ten on that wave with style and I WILL PAY YOU FOR THAT!!

Eventually almost everyone will pay as they realize it's the ONLY WAY FOR THEM TO STAY RELEVANT AND COMPETE and be successful in this new "Information and Social Connection" economy.

Wednesday, September 30, 2009

Twitter is Woodstock. Facebook is a Garden Party

Twitter and Facebook are fundamentally different. Facebook is an invitation-only garden party for your friends in your own backyard(garden). Just like Ricky Nelson song "Garden Party". "I went to a garden party to reminisce with my old friends. A chance to share old memories and play our songs again. When I got to the garden party, they all knew my name...." 

Twitter on the other hand is a Woodstock-like festival experience for anyone who shows up at Yasgur's Farm. Like Joni Mitchell sang later.. 

"I came upon a child of god, He was walking along the road And I asked him, where are you going, And this he told me Im going on down to yasgurs farm, Im going to join in a rock n roll band, Im going to camp out on the land, Im going to try an get my soul free, We are stardust, We are golden, and we've got to get ourselves back to the garden"

Joni wrote this because she regretted canceling her appearance at Woodstock. Her agent put her on the Dick Cavett show instead. Yikes, talk about wrong place at the right time! Twitter is like Woodstock in another way; the Twitter promoters (Twitter founders), just like Woodstock, decided to cut the fences down before the day of the concert (Public posting of comments) and spend the money building the stage instead. The human experience of being on FB versus Twitter is also very different. 

With Facebook, conversation is easy because you know everyone at your garden (FB Wall). With Twitter your party doesn't get going until all the Woodstock fence-jumpers have decided you and your tent in the field are worth hanging around and partying with. Which involves getting down and dirty dancing in the mud. ;-)  With Twitter you have to "let go" and mingle with your inhibitions left behind. Just like Woodstock.

So what kind of party do you like? Muddy psychedelic Woodstock? Or civilized and private Garden Party?

Me? I tend to go to most parties I'm invited to. But I really have fun at the ones where I'm a "crasher" . :-)

Monday, September 14, 2009

Avaya/Nortel - Traditional Enterprise Telecom Market Moving Toward Disruption

It was announced this morning that Avaya(TPG/SL) has won the stalking horse auction for Nortel's Enterprise division. Avaya made this move mainly for the channel expansion and market-share growth. They will now look to aggressively churn the Nortel base into buying Avaya solutions.
As economy recovers and large enterprise starts buying capital equipment again it’s very feasible that Avaya could easily gross an extra $900M in the course of 12 to 18 months as a result of the acquisition of the Nortel base and Nortel VAR channel partners. This is what smart private equity buyers do. The attempts by Gores Group (Seimens Enterprise Telecom Division owners) to acquire Nortel mean they saw the exact same value prop as TPG/SL.
The $15M set aside as a “retention” fund for Nortel employees likely is really more a “severance” fund. This is a “spoonful of sugar” to be used in softening the blow for Non-US workers who all have severance requirements built into employment contracts via unions and/or non-US govt regs. US-based Nortel workers are going to have a very rough go of it. It’s mostly a non-impact for Avaya workers or a slight positive.
Also in a more strategic sense this suddenly makes Avaya a lot more attractive in relation to a future liquidity event for TPG/SL. Whether they decide to IPO and relaunch Avaya as a public company or sell it, it’s now a more attractive property. Selling it now may be somewhat more complicated because if it was sold to Cisco or another major telecom player now you truly would have a non-competitive market situation from US FTC/DOJ perspective. So the ideal private sale for TPG/SL would be to Microsoft. That would give at least a duopoly of Cisco versus Microsoft in the Enterprise Telecom market. Another possibility would be a sale to a major telecom carrrier like Verizon; notice VZ complained to DOJ about Nortel/Avaya merger.
In a much broader scope, the Enterprise Telecom/UC market is being set up for a disruption by solutions like Google Voice/Wave. Eventually the future version of traditional “Hosted Telecom” that the RBOC carriers deliver(ed) is going to be replaced by something I call “Cloud Telecom”; or more appropriately “Cloud Collaboration”. F500 companies are going away form big corporate campuses with thousands of people at one site toward a very distributed employee model. Employees more and more are scattered around in small offices domestically and overseas and also lots of people working from home/virtually. So big iron CPE boxes at corporate sites become less and less relevant. Instead all that is needed is for an employee to be able to reach those corporate resources at a network connected datacenter via SSL VPN over broadband. So why not then just outsource the datacenter instead of using inhouse datacenter and IT?
That is where an offer like Google Voice, enhanced with perhaps an Avaya CMS call center supporting virtual agents, becomes very attractive on a variable cost (subscription) basis.
This will disrupt both traditional hosted voice AND customer premise telecom businesses as they currently exist. Even very large multisite companies will be able to go fully to Cloud Collaboration, even in the call center. In call center the traditional equipment will hang on for a long time but now in a hosted/subscription model versus as a capital purchase for the enterprise.
However, It’s going to take about 5 years to 7 years for this disruption to happen and before it becomes clear this is coming, TPG/SL will sell Avaya or relaunch Avaya as a public company and get their money back.

Friday, September 04, 2009

The "Blue Ocean Collaboration" Replacement for Distributed Personal Computing

The period from (1985-2010) is/was a technology/market era that was focused almost exclusively on the mechanics of enabling "Independent Personal Computing(IPC)". The goal was all about faster processors, bigger disks and more RAM to run ever more complex locally deployed PC applications.

That era is coming to an end. 

We now are transitioning from that IPC focus into an technology/market era that will be focused almost exclusively on maximizing the productivity of what I call "Interpersonal Realtime Collaborations" (IRC). IRC is a hybrid value proposition that results from merging the value proposition of communications technology with the value proposition of computing technology. This IRC value proposition will be important in the professional marketplaces as well as the consumer marketplace. 

The reason for this is, 'computing power' is now becoming both ubiquitous and inexpensive, (true both for distributed as well as Cloud-based computing). With computing power reduced to a commodity it can no longer be the primary/exclusive value focus for computing technology companies who want to build and market premium-priced technology products, software, services. 

A similar disruptive process is happening to traditional voice/video/text communication solutions as standalone "Customer Premise" solutions. They also are commoditizing rapidly and traditional communications companies like Avaya, Cisco, Nortel, Mitel, Shoretel, Ericcson, Seimens, NEC, etc. are seeing that erosion in profitability. 

However, the seamless combination of communication technology and computing technology delivered over ubiquitous broadband pipes, that delivers a premium IRC experience, is currently not available widely. But it is something people are starting to demand. Those companies who provide it first will be able to take the initial high margins in this new market. Google is about to launch a big initiative in this area with the Google Chrome OS running on lightweight "netbook" devices.

So what does this mean? The companies (PC manufacturers, Telecom equipment manufacturers, Software companies and others) that refocus most effectively on enabling IRC vs IPC will win the profitability and the marketshare battles. They will win because the best IRC solutions will have the highest customer demand and therefore deliver the highest margins on sales of everything that supports the IRC experience. With realtime communication being elevated in this new era to be a much more critical value proposition the visionary companies have opportunity to to be significant players/leaders in this new IRC marketplace. 

This "IRC marketplace" is an attractive and exciting Blue Ocean into which manufacturers must willing dive head first. 

Monday, August 31, 2009

The Ultimate Collaboration Technology Coming Soon! The HUMAN HIVE MIND! A Force For Good...Not Evil.

Jeremy Epstein has a cool blog post today on an innovative communication social networking activity he came up with called Rolodex Roulette

The basic idea is go to your cellphone contacts and pick one name from your list from each of the letters of the alphabet and call those 26 people.  Odds are you will connect live with maybe 1 of 4 people you call. So maybe 6 conversations. Jeremy had 8. 
Now you may think this is a weird leap for me to make but....I think Jeremy's idea is another tiny step toward the coming of the "Human Hive Mind (HHM)". HHM will be the Ultimate Human Collaboration technology.

Now before you "run" screaming off into the "internet woods" in horror banging yourself into virtual trees, let me reassure you, I think this is a good thing to happen for humanity. Here's why...

I believe we all deeply crave a deeper and more meaningful and positive mental connection with our fellow "man"(gender non specific). So I'm developing a theory that says as we approach the technological singularity point, and we overcome our fear of connecting fully with our fellow human beings, we will hyper-network our brains into a hive-mind-like construct that we will be able to jump in and out of like a swimming pool.  

Game theory says that positive cooperation among human actors produces optimal, 'mutually beneficial' results. This means unless society collapses, and prevents the technology from being developed, the human race is on an inherently natural path to construct and participate in ever more rich "hive mind" collaboration environments. Virtual collaboration worlds like WOW, Second Life, Twitter, Facebook and others are early examples of this direction. Imagine what will happen when in addition to voice, video and text as channels of communication we start to add things like mood to the communication. 

I believe that the majority of the thoughts we have, and the most powerful thoughts, are positive thoughts and I think when we start setting up hive minds that our positive thoughts will be the most self-reinforcing. I believe a logical outcome of this is our society will rapidly start becoming more moral, ethical and philanthropic that we are today. I know this concept scares a lot of people for reasons of privacy, individuality and fears of evil hive minds, such as those depicted in science fiction literature and film, (Star Trek:TNG's "Borg collective").  

But what will really emerge is not this "boogeyman-esque", all-encompassing, mind-numbing version of a hive mind. Instead I think it will be something more akin to what is described in the Star Wars series. There the experienced Jedi are connected via "the force" into being able to feel an overall understanding of the fabric of the collective state of mind other living beings in that society/universe.  

Can you imagine being able to at your own will jump in and out of feeling connected, at a level you find comfortable, to the whole of the human race and it's state of mind? To participate in and contribute to that state of mind? Like anything, if done poorly, it could be damaging to have a hive mind. 

For example; imagine a hive mind being used to exclusively connect only those people who are racists and exclusionists. It could be used by these angry, disenfranchised people to be more effective in causing damage to society. But this danger exists with any new technology. The technology is certain to be used much more often to proactively engender positive interactions between people. I think that ultimately the positive uses of new tech usually outweigh the negative. 

Consider even the positive outcomes of Nuclear science and technology versus the negative outcomes. It's been almost 65 years since the nuclear bomb was developed and yet despite all the massive war strife and anger since then we as a race someone have yet to wipe ourselves off the planet. That tells me something. It says that as a human race, despite our differences, we really do want to survive.
So I think hive mind technology will be no different from when printing, gunpowder, photography, the automobile, aviation, film, radio, nuclear power, TV and internet arrived on the scene of humanity. Some will fear the technology. Some will seek to use the technology for antisocial purposes. But many more will use it to for the purposes of improving the positivity of interactions between people.  

All the previous communciation technology steps that are precursors to hive mind technology (printing, photography, film, radio, TV and internet, etc) have all made significant positive impacts for humanity leading to more freedom, peace and harmony between people. Certainly our 24/7 news outlets focus on the reality that we have lots of war, strife, anger and hatred in todays world. But I think the communication technology improvements over the past 500 years in communication and collaboration technology were crucial to our society advancing.  

Communication technology in the form of printing is what stopped the dark ages death spiral of European society and started it on this ever increasing slope toward positive outcomes for humanity. I think the spike in pain and strife we see coming out now is not a sign of growing overall negativity in the human race. Instead I think it is just a lot of previously hidden resentment, anger and hatred being leeched at a ever more rapid pace out of our collective consciousness by the ever more frictionless nature of our ability to communicate. Communication/collaboration is getting more and more frictionless and affordable.  

Cisco is one company working hard on building affordable, full-body 2D video presence solutions. 3D holographic presence is the next step. In fact in the recent movie I took my sons to, "GI Joe:The Rise of Cobra", Cisco has it's brand splashed all over a bunch 3D, holographic collaboration solutions that exist in the futuristic setting the movie portrays. Now think about later when hive mind solutions start to emerge in concert with that. I think these solutions will accelerate the leeching of hatred, anger, war and negativity out of human society.  

As Yoda said in SW-I ""Fear leads to anger, Anger leads to Hate, Hate leads to Suffering." The path back the other direction from suffering, that inverts this direction, starts with rich and regular communication. Yoda also should have instructed Qui Gon Jin and Obi-Wan Kenobi in regard to the young Anakin Skywalker..."Endeavour always to constantly speak, interact and communicate with your Padouin learner. Communication leads to understanding, understanding leads to collaboration, collaboration leads to fellowship, fellowship leads to trust, trust leads to peace."  

Do not fear the coming of the human hive mind(s). Embrace this evolution, encourage it, participate in it to contribute your positivity. Like the printing press it will be a tool of trust and understanding far more than a tool of ignorance and fear.

Friday, August 28, 2009

Is Google Chrome OS a rival for Microsoft Windows? Or Something else?

In this blog post on the Chomium OS Central blog there is a discussion of whether Chrome OS will be a rival to Windows.

Quotes in that blog from Phil Balmer and Bill Gates indicate where they stand on this question. Summed up they have Alfred E. Nueman's "What Me Worry?" viewpoint. (Bill kinda looks like Alfred doesn't he? :-) )

So clearly Phil and Bill don't get it.

It's not about whether the computing technology is new or not. Disruptive technology rarely is NEW technology. Thats why they call it "Disruptive" versus calling it simply "NEW".

The key enabler for the broad adoption of a truly thin OS with focus on cloud based apps (Chrome OS on netbooks) is all about the availability and adoption of broadband. As the fast internet connection becomes fully available to you pretty much 24/7 everywhere you are, your use of web apps becomes dominant.

Just ask yourself: When is the last time I spent even 30 minutes working on my computer or laptop doing productive work for my job with no internet connection?

Likely it was when you were last on a plane. But at any one time in the US there are about 5000 commercial planes in the air carrying maybe 100 people on average per plane. Thats 50,000 computer users max at any one time who can't do web apps work. Not a big deal really. Plus now airlines are rolling out internet connection on flights. So even that is not a blocking problem.

Chrome is certainly NOT a rival for Windows. It's an alternative for a growing segment of the computing user population!!

And that is the heart of what makes (Chrome OS + Ubiquitous Broadband) a disruptive technology to an incumbent and currently dominant technology provider like Microsoft.

Every dog has it's day. Microsoft has had 25 years worth of days as top dog. All things pass into history and now MS must change to play a new role of it will not be relevant in the future.

What do you think? I want to hear your comments.

Monday, July 27, 2009

Liquid Media LLC is Hiring Software Developers

My company Liquid Media LLC is looking for part-time to full-time software developers. Compensation initially is equity-only with potential to transition to salary/equity combination as the company grows.

Keep your day job for now and get started working in a startup on the side. Then when we achieve full funding we'll have fulltime/salaried positions.
Contact me if you are interested and forward this description to anyone you think might be interested.)

Job: Senior Agile SW Developer(s)

- Do you have a passion for creating quality software?
- Are you sick of people saying their agile only to find out they don’t even know what it is?
- Have you ever wanted get involved with a software startup at the beginning and do things the "right way"?

With the economy down there is NO BETTER TIME to make your mark in the early stages of a startup.

This is an opportunity to be an early key player on the technical team of a Boulder/Denver startup company in stealth mode. We have a "hosted services" concept/solution that business customers are willing to pay for and they are waiting for us to get the product ready for their use. This is a not a "give-it-away-for-free-and-pray-we'll-someday-be-able-to-make-it-up-in-pay-per-click-advertising" startup.

Frankly those companies mostly suck because they are mostly doomed to crash and burn.
This company/solution is positioned for rapid growth as the economy stabilizes and begins growing again in the next 12 months.

The Team/Technologies:
The team actually practices eXtreme Programming instead of just giving it lip service. That means TDD, aggressive refactoring, pair programming, automated unit and integration tests, stories, iteration planning, etc.
The technologies we are playing with are: Java, JPA, JSF, SEAM, Richfaces, REST, JMS, Junit, Mockito, Eclipse, Postgres, etc

Job requirements:
· Proactive and Flexible Self-Starter comfortable working in a Startup
· Comfortable working in an agile software development environment
· Perform software design, development, testing and documentation.
· Understand OO principles
· Worked with James Gosling on Oak
· Never broke the build … ever
· Have a sense of humor :-)

To learn more about the company/concept and founders send inquires to "".

Tuesday, July 14, 2009

The Pied Piper Stole All My Subscriber's Attention and Money!!! what Verizon, T-Mobile and Sprint are thinking to themselves as they start to finally wake up to the impact that Apple and the iPhone is having on their business models. Alec Saunders has an extensive blog post today on Verizon trying to put the iPhone genie back in it's bottle.

The problem is this move by Verizon is a combination of "too little" and "too late". The iPhone has been out for over 2 years now with 2 significant upgrades to it's HW and 2 for it's firmware and with 30,000+ apps in the store;

There is also some "how to lose friends and amuse enemies" in this. RIM and other handset vendors whose devices ride on Verizon networks have already started or are starting their own app stores. They see the move by Verizon as competition to their app stores. They see Verizon in it to corner the lion's share of the profits from App sales and control what apps are allowed on their devices.

Where does this lead?

Most likely what will happen is, when the ATT and Apple exclusive contract ends next year, Verizon and Sprint will become compelled to add the iPhone to their networks on Apple's terms. The wildcard in this is the chance that ATT will negotiate with Apple to extend the exclusive contract beyond 2010. If that happens Verizon and Sprint will be in serious trouble.

In either case, if Verizon and/or Sprint commits to a specific handset maker, such as RIM, being the "store manager" for their app store, and then gives RIM control, revenue share and handset subsidies similar to what ATT gives Apple, Verizon just might develop a competitive mobile apps ecosystem as they still have 80 million subscribers.

But if they try and create their own Carrier-controlled and device-independent app store I think they are doomed to failure. Carriers are just not agile enough to pull off supporting a community of fast-moving app companies and device vendors would rather try and build their own, carrier-independent app stores that be controlled by Verizon.

Sunday, July 12, 2009

Are You in Denial About How Much Privacy You Have?

I read an interesting blog article today by Brooke Crothers of CNET titled "Comfort Zones: Windows vs. Linux".

Like many articles lately this one is pondering the impact of Google announcing the Google Chrome OS that is being targeted for use in low cost "Netbooks".

Brooke says Chrome, and other Linux based OS's, always struggle because consumers go with brands they know. Like MS or MacOSX. But a funny thing about us humans is that statement is true right up until we as consumers decide we no longer like a brand. As they say "Familiarity breeds contempt". We're a fickle race.

But the key decision isn't really Windows vs Linux Vs OSX is it? That debate is an uninteresting red herring focused on an inane, "strawman" of a popularity contest over people's favorite "distributed fat OS" brand. The important debate is over hosted/cloud computing from a thin client vs distributed thick computing on a thick client (but really mostly thin from a browser anyway).

Suppose a hosted computing provider offered thin computing to people and allowed them to choose, and alternate between, a Windows XP experience, a Vista experience, a Windows 7 experience, a Ubuntu experience, a Mac OSX experience or some new flavor like Chrome; or maybe CUSTOM? If choice of the look and feel and familiarity of a favorite OS experience remained, but it was all done thin, how many people are truly going to be so paranoid over privacy concerns that they will turn this down? Not many.

If Google leaks my data they are a big fat target with a big fat bank account I can sue if they violated the EULA "End User License Agreement" they agreed to with me. By comparison, if some browser malware on Windows IE 8 steals my data, I'm screwed. No one to blame and Thick OS vendors like MS have indemnity against data theft in the T's and C's.

Sure the paranoid conspiracy theorists come out of the woodwork when you talk about cloud computing. OH THE HORROR!! SOMEONE WILL STEAL MY PRECIOUS DATA!!!! But they are in denial if they think they have anything today but an illusion of privacy in most of what they do. Well, unless they are hoarding cash in their underground bunker instead of banks, don't use any credit/debit or loyalty cards of ANY kind, have no internet connection and never go anywhere that has video monitoring cameras. Unless they do all of that, which if they do means they are a "wingnut", they don't have true privacy anyway.

I mean look at the use of all the browser-based email clients! Lets be real. Most people aren't in general overly worried about the privacy of the data on their computer. If they were and they were smart they wouldn't have ANY data on a computer they consider especially sensitive. If people were so worried then Yahoo, Hotmail, gmail and AOL wouldn't together have 100s of millions of email addresses being used daily. Once you take out the "brand favorite" problem of what your UI looks like, people will flock to hosted/thin computing.

The other thing the anti-cloud crowd wails about is "offline computing". But just look around you right now at the wifi coffee shop hotspot you are at. How many of the people sitting around you with laptops aren't logged in and connected to the net? Anyone? Bueller? Bueller?...... The fact is virtually no one does any significant amount of computing work on their computer (say >10% of their time), without being connected to the Internet these days?

Cloud computing is an inevitable outcome of computing evolution. So get over it folks. If you think in 20 years, or even 10 years, that you'll be running a powerful, local, multi-core processor crunching on a big fat hog of a local OS you are in denial or just aren't paying attention. Lots of people in 1910 said they would never, ever own a car and nothing was as reliable and safe for transportation as a horse and/or horse & carriage. By 1920 the buggy whip makers, carriage manufacturers and blacksmiths were, shall we say, worried.

100 years later we have a similar transition happening from fat, distributed OS's to cloud computing. So why fight cloud computing for ridiculous reasons like what your UI experience feels like; or because you want to pretend you can live under a rock and have "early 20th century"-style privacy and anonymity? The only way that kind of privacy comes back is if we get a global collapse of the modern technological society. If that happens you'll get your thick computing and privacy. But it will be a Pyrrhic victory as you'll spend all your time trying to feed yourself growing and hunting food. Data privacy and Computing UI choice will not be relevant anymore.

"Thin" is almost "in" for good this time. Are you prepared for it?

Monday, July 06, 2009

Father Guido Sarducci on the Free" versus "Paid" Internet Debate

At Fred Wilson's "A VC" blog over the weekend Fred posted a long post on the recent Chris Anderson book Free: The Future of a Radical Price.

In the book Anderson argues that...

"Free is emerging as a full-fledged economy" and ..."There is, presumably, a limited supply of reputation and attention in the world at any point in time. These are the new scarcities — and the world of free exists mostly to acquire these valuable assets for the sake of a business model to be identified later."

This book is causing a bit of a firestorm of interest and argument over whether this "Free" approach to commerce on the internet is truly as viable and as likely to succeed as Anderson seems to propose.

I'm in general agreement with Fred Wilson's position that "I don't believe everything will be free on the Internet. There will be plenty of paid business models." Instead of the purely "Free", Fred talks about the idea of "Freemium" where providers on the internet make some services free, while others have a price.

However Fred also seems to gloss over a bit an important point I think needs to be considered.

Does Free, or even Freemium in it's current "give-it-away-for-free-for-a-while-then-a-miracle-happens-and-you-can-charge-for-something" model actually scale enough to be emerge as a "full-fledged economy"?

An old Saturday Night live skit I think applies here is one from way back in the 70s where Father Guido Sarducci, in his "5 minute University routine" boiled Business down to something that still applies. He said “Business? 'Itsa' very simple. You buy something…you sell it for more. ("See him do this bit in standup routine on Youtube at 1:54 mark of this clip.)

The barebones problem with Free and even the current Freemium model is this:

Until grocery stores start giving away food for free, houses/apts are free and dept stores give me free clothes and shoes, I need to earn a salary to feed, cloth and house my kids…and so do you and so does every other responsible adult. That means I, or my employer, needs to get paid enough so I can feed my kids. That means my employer, who pays me, can’t operate unless someone pays them for products and/or services..

Now certainly Google and a dozen, or a hundred, other companies are using “Free” and some are even making enough money off the Pay-Per-Click or other ad-based models to sustain operations.

But here’s the problem. A “Free” based economy can’t scale. Even if 1,000 US companies could survive using “Free”, and pay lets say an average of 10,000 people a piece a living wage of some level, that is still only 10,000,000 jobs that perhaps can feed/clothe/house an average of 2 adults and 2 kids per salary. That’s only 40,000,000 people getting 3 squares and a place to sleep. With manufacturing largely gone form the US and white collar corporate job migrating overseas also, what about the other 260,000,000 people in the US? And in reality, in the long run, what about the other ~5.75B people on the planet?

The reality is there is no way that even 1,000 companies with 10K employees per company are going to be able to be money-making concerns for any significant length of time on “Free”. “Free” simply doesn’t scale.

The reason is, there aren’t enough ads being impressed today on internet users, nor will there ever be, to generate enough money to allow Free to be a viable foundation for any significant portion of the economy. In fact people are getting better every day at ignoring and not responding to advertising on TV, Internet and everywhere else. Sure there are still, for a while at least, going to be a handful of companies who can reach a critical mass using Free and ad-based revenue. But it will never be enough to support a significant number of people with food/shelter/clothing.

So this whole argument over whether Free versus Paid is a bit of a tempest in a small teapot. The future of the internet, for the long run, is in “paid” services. This current transition period from 1999 to 2009 is merrely that, a transition period.

In 1999 I desperately needed access to a LOT MORE information of all kinds. So I was willing and eager to immerse myself fully in the full stream of info available on the internet and web. But in 2009, I desperately need LESS total information access because the full stream is way to big for me or anyone to handle on their own. So 1999 to 2009 has been a blip in time where ad based revenue works because everyone had to wade through the flood on their own and therefore we’ve been susceptible to the internet advertising that has made Google and some others quite rich.

But today? Things are changing. Today, I desperately need to get ONLY the information from the internet stream that I NEED to achieve the goals I have set for myself. Other than that I don't even want to get the least “wet” from the rest of the information in the stream. It is already nearly impossible for each of us to sort through the immense flood of data to find the best and specific examples of information we each want/need.

So, going forward; The main thing people will pay for is personalized/customized filtering of the internet information tsunami that continues to grow exponentially. If there are 30 companies all offering me Free service in every possible category then I have a BIG dilemma. Which free service do I choose so I don’t waste all my time trying Free services? I will eagerly pay to have someone point me at the “RIGHT” Free service for ME. Then I likely will be willing to also pay for the services I choose to make sure the quality remains acceptable over time. I don’t have the time/attention to spare have to be switching services to the “NEXT BIG THING” every 6 months.

To dig a bit further though; Why is this true? What is the fundamental concept that requires that economies operate “for pay”, in this universe we live in?

The core problem is a combination of having no unlimited, even virtually unlimited, source of free energy and a law of physics known as the "Second Law of Thermodynamics". This law of physics says that in this universe “things tend to disorder” (a.k.a. Entropy). Right in line with this concept, the proliferation of Free services on the Internet is causing massive disorder and increasing the waste of people's energies trying to keep up. Services come and go constantly and we have to continuously expend energy just keeping up with all the random changes happening every day. Eventually we will all lose patience with Free because its a big mess that takes too much time to wade through. Paid services will emerge that help clean it up for useful consumption.

People have always and will always, until we discover a free and virtually unlimited energy source in this universe, pay extra for cleanliness, quality and leisure time.

As the Internet stream devolves from enjoyable dip in a clean and invigorating stream that most people can handle into; an overwhelming, near-drowning experience in a tsunami of toxic waste and dangerous sharks; you’ll start to see “for pay” services emerge. These services will distill the toxic, fullstream Internet flood into something that is again not only consumable, but actually more enjoyable and more useful to the mainstream of Internet user.

Eventually every “Wild West” has to be tamed. The Internet Cowboys will all mourn as the "Open Range" of the "1995 to 2010" Internet evolves into an internet fenced farms, ranches, city planners and where you have to pay for "real estate" instead of roaming around and squatting wherever we see a nice piece of land. But such is life.