Chris Anderson – Mr. Long Tail, editor of Wired Magazine – makes a great decision: assuming that everyone in the audience has either read The Long Tail or knows the argument, he gives a different talk: “What Happens When Things Get Free?” (It covers much of the same ground as the book, but draws a different narrative through many of the same examples.)
He starts with a photo of Dr. Carver Mead. Mead started thinking about what happens as semiconductors get cheap to the point where they’re free. The answer is, “you should waste them.” This insight led to VLSI – Very Large Scale Intergration – chips that included thousands of transitors, not just single ones.
Alan Kay figured out what you might do with these plentiful, free transistors – be wasteful on the screen. If processing power is abundant, you can make pictures on the screen – icons – instead of forcing people into the command line. This helped make computers beautiful, fun and useful to many more people.
We’re moving from economies of scarcity to “abundant economics”. Hard drive storage has become abundant to the point where GMail is able to give users 2 gigabytes of mail, instead of the 2 megabytes Hotmail used to give you. “Your mailbox is full? What was that about?”
Broadcast media is a product of scarcity. Since there’s a limited set of channels, you have to be very discriminating about what gets out, releasing only things that have a very broad appeal. The emergence of YouTube and others shows what happens when there’s an infinite set of channels available.
3D printing means that, for the first time in history, complexity is free. “What beautiful, extravagant, and unnecesarily complex things will we make now that we can?”
Chris runs through a quick set of examples of the move from economies of scarcity to economies to abundance: Walmart’s ability to offer three colors of Kitchenaid blender, versus 57 on the Amazon site; Blockbuster versus Netflix; Tower Records versus iTunes and peer to peer networks.
He compares broadcast television to lonelygirl15 – no one focus-grouped it, no one greenlighted it – it was a project by indie filmmakers in their apartment, who did it because they could… and it now gets more viewership than some broadcast tv shows.
Chris walks us through the most linked sites on the Internet according to Technorati, pointing out that the four “punks” behind BoingBoing are now more influential than Fortune, Reuters or the Chicago Tribune. (He doesn’t mention that they’re more influential for the small set of bloggers, not for everyone on the planet…)
Conde Nast, which publishes Wired, is all about the economy of scarcity – Chris tells us he’s trying to produce “a perfect faberge egg of a product” – ad pages are expensive, printing and shipping are expensive. As an editor, Chris needs to bet on what’s going to be popular and immortalize those decisions on dead trees for 650,000 people. He’s excited by the idea that the Wired website might work like Digg, letting people “scramble the eggs”, picking what’s most exciting and moving those stories to the top.
He walks us through some of the business changes that happen as we move from scarcity to abundance:
– In the past, we built business cases based on ROI. Now we build it and build the business afterwards.
– In the past, “everything is forbidden unless it’s permitted.” Now everything is permitted unless forbidden.
– Scarcity is about paternalism, a decision that an editor knows what’s best. Abundance is about egalitarianism.
– Scarcity is top-down, abundance is bottom-up. Instead of command and control, it’s out of control.
Chris tells us that he’s trying a new management philosophy – “I do whatever my interns tell me to do.” This is leading him towards carrying out book signings in Second Life. He doesn’t know if it’s really a good use of his time… but it’s what the grassroots are telling him to do.
He closes with an excellent viral video, The Day of the Long Tail – always a good thing when you coin a term successful enough that folks will make videos for you.