Free for how long?
Posted by bmackay on July 7, 2009
This just in. I love youtube. But is the youtube business model really sustainable? I’ve heard conflicting reports but my understanding is that the bandwidth costs alone of youtube exceed $1 million/day. That doesn’t include the cost of servers and the petabytes of storage required for all those videos.
I’m probably not alone in saying that few people click through the ads in youtube or facebook. Twitter doesn’t have any ads to click on. But youtube and twitter are really great things. Perhaps in the future they will need to be funded like public television? Just a thought…
Even the heavyweight pundits of all things Web 2.n are weighing in on the debate. Malcolm Gladwell (Blink, Tipping Point etc.) thinks that the free model in practice is unsustainable whereas Chris Anderson (The Long Tail, Free: The Future of Radical Price) thinks that content will remain free. While Anderson’s book is on my reading list at first glance I’d have to side with Gladwell on this one. I remember talk 10 years ago in the dot com boom that business models that had actual revenues and profits were obsolete. I don’t buy that. I’m not even convinced about the validity of Anderson’s concept of “Long Tail Ecomomics.” Most people the world over frequent only the same handful of sites each day (see Alexa.com) Heck because of the Internet, it would appear that people are choosing from a pool of fewer and fewer names for their babies.
And free or not free, youngsters aren’t even using facebook as much as they used to as facebook’s drop in growth rates in the high school and college cohorts shows:
