Hugh Garry

SXSW: Chris Anderson on 'The Power of Free'

The final keynote of SXSW09 saw Alltop founder Guy Kawasaki sit down with Wired Magazine editor Chris Anderson to discuss the power of ‘Free’. Following the Sarah Lacey debacle last year Kawasaki was brilliant in extracting some interesting insights into financing models for the 21st century. 

Anderson talked through a range of subjects including the power of 'freemium', publishers facing the some problems as record companies and what China can teach us about capitalism. Quoting French mathematician Joseph Louis François Bertrand, Anderson claimed that in times of recession market prices naturally gravitate toward margin price and the internet is a massive driver in making this happen.

On his book?

“The digital forms with marginal costs should be free. Free is the best way to maximize your reach. If you believe in physical books people will buy the books, even if it’s for someone else.”

“I reserved the audio book rights to myself.”

“Writers and publishing companies might have a similar relationship in future to what is happening in the music industry with record labels and artists.”

“Each one of us has to figure out our own way to convert our reputation into money.”

“It is easier to achieve popularity than to monetize popularity?”

On free models

“Free will be the predominant pricing model in the future.”

“Twentieth century free meant you were going to pay sooner or later e.g. buy one get one free.”

“Twenty first century is really free. It’s based on the economy where they more you sell the cheaper it gets. It’s really free because the costs are close to zero.”

“If you can convert 5% of your users to pay then you’ve covered your cost. Everything else is profit.”

“Thanks to the internet  this is the first truly competitive market in history and first market where the price is falling to the marginal cost.”

“Barriers to entry in digital economy are so cheap. Free becomes the natural price for things.”

“Online video games are the best example of fermium users. They let you play the games then charge you for various bits you want to add.”

"Once you install a price you find out how much "stickiness" there is.”

“Paper still matters. Some paper adds value to the internet.”

On Piracy

“The music industry is fine apart from one small part of it, the sale of recorded music.”

“If you do not make your product free piracy will do it for you.”

“Don’t expect to make money off your CD. Monetize the celebrity you make from the piracy.”

“Chinese pop stars make money, not off music sales but from making personal appearances, starring in advertisements, etc.”

“What can we learn from China? Ironically China will teach us capitalism.”

Trusting Free

“In the physical world people might be suspicious of free. In the digital world people aren’t.”

"In the digital space waste is a good thing because it has zero cost. You don't think less of Google because it's free.

“Your expectation of free is based on your last interaction with it.”

“Open-source is free as in kittens: you have to look after them. A lot of the free stuff we have is because we support it communally.”

“New York is driven by institutions, San Francisco isn't driven by institutions, it’s driven by individuals. Driving start-ups. People don't seem as threatened as in New York.”

MIT Working on a SIXth Sense

Before you even ask about uses for this just enjoy it for what it is... Bloody marvelous.

Designed by MIT's Pattie Maes SIXth Sense attempts to create a new digital sense for humans. The fantastic device augments the physical world around us with digital information using natural hand gestures to deliver and shape how the information is viewed. The framing of a view using only your fingers can capture a photo to be viewed on any surface, whilst the outlining a circle on your wrist will deliver a digital watch... Awesomeness.

It works by using a camera and a tiny projector mounted on a hat. The camera sees what you see and projects any surfaces or objects you are interacting with. The prototype uses an ordinary webcam and a battery-powered projector, connected with an internet enabled mobile phone. Apparently this prototype costs less than $350.

What excites me about SIXth Sense is that it pulls together multiple technologies to create something quite spectacular, the true definition of creativity. In the last couple of years we have been wowed by technological advances such as QR codes, augmented reality and Microsoft Surface and now along comes something that combines elements of each in a brilliant way.

It's all very Tom Cruise in Minority Report, futuristic, full of possibilities and probably closer to a reality than you might think on first viewing. Whist the idea of walking around with a projector on your hat may seem unthinkable one of the more talked about additions to the handset in mobile at this year's Mobile World Congress was a phone with a projector in it.

Lyddle House on the Prairie

When Russell came up with the brilliant idea of crowdsourcing a model village of the future (2050 to be precise) I thought it would be a great opportunity to get my fingers sticky with some UHU and the Hornby Terminus Office Building he kindly popped in the post.

Naturally my early thoughts centered around internet connected appliances and eco friendly structures. But in 1988 Talking heads released their last studio album, which had this brilliant track on it.

David Byrne's tongue in cheek vision of not being ready for a green future shaped my thinking around Lyddle End 2050, spinning my thoughts into a much deeper and darker direction than is natural for such a positive guy like myself.

The first bit of construction was building a Spotify playlist that would help me shape my vision. Thanks to the brilliant collaborative nature of their playlists everyone can add a track to the playlist. Feel free to chip in regardless of how different your vision of Lyddle End 2050 is from mine. It will be interesting to see how it ends up

So... as I said, it all gets a bit dark from here on. We all dream of a green future, but what if it was forced upon us at a rate we weren’t ready for or willing to accept. What if factories started vanishing before our eyes regardless of their economic health. High street names we know and love started disappearing, not because of a financial collapse but because they were forced out of business by the new green police for not adhering to extreme government policies. 

"This was a Pizza Hut. Now it's all covered with daisies...I miss the honky tonks, Dairy Queens, and 7-Elevens... And as things fell apart nobody paid much attention"

Planes are grounded, car production brought to a halt, roads replaced by fields, alternative energy sources failing under the weight of demand. As the song says “If this is paradise, I wish I had a lawn mower”

Here's a glimse of my house in Lyddle End 2050. The solar panels on the side of my house haven’t worked since the riots of 2035 and the metal fronting on the front is protection against the looters and The Green Police. The collapse of the IMF, and the subsequent closure of the world’s banks, prior to The Environmentalist Party taking power leaves us living in a Mad Max like lawless state.

Everyone carries a gun. Everything is locked down. Everything has to be taken by force. In Lyddle End 2050 nipping next door for a cup of sugar takes on a whole new meaning. If you’re not fighting off The Green Police for imposing a 1 child per family limit you’re shooting your neighbor for stealing apples form your tree. We asked for a green future and we got it.

As for fully connected appliance and the internet of everything... well... The internet in 2050 no longer exists as we knew it. Our faith after the first 5000 days was somewhat misplaced. This article in Wired about the man who 'broke the internet' coupled with the vulnerability of 'The Cloud' made me think about how totally insane the whole idea of the internet is in the first place.

"It was the ultimate hack. He was looking at an error coded into the heart of the Internet's infrastructure. This was not a security hole in Windows or a software bug in a Cisco router. This would allow him to reassign any Web address, reroute anyone's email, take over banking sites, or simply scramble the entire global system"

We were one good hack away from surrendering all our secrets and the great hack of 2045 gave one man more power than all the superpowers combined. As a result our fully connected world disconnected piece by piece faster than you could say "Can I have an Oyster Card please". Fibre optic cables were ripped from under the floors and we couldn't smash RFID enabled possessions quickly enough. TVs, gaming systems, fridges, cookers, phones, items of clothing, bank cards, doors, windows, clothes, toothbrushes...

We spent 45 years teaching everything we owned to talk to servers without ever giving a second thought to what it would be like if those servers fell into the hands of one man. He knew our every move... and I mean our every move. He controlled the internet, he controlled what was left of the banks and he controlled our houses remotely. We couldn't brush our teeth without him knowing how many stokes it took and we couldn't put food in the fridge without him knowing the fat content of each item. Once again paranoia took hold and the only way to deal with it was to destroy everything.

So, my Lyddle End 2050 house is an unconnected steel structure, a hollow shell surrounded by over grown trees and fields, protected by guns and free from possessions. Still, it has a wicked soundtrack. Can't wait for the street party.

The Quite Wonderful Dr Horrible

 

I must say I've been loving Dr Horrible's Sing-Along Blog and now it's gone I feel there is a hole in my life normally only felt when either the football season has ended or when the doors on the Big Brother house have closed one last time. In a week that sees the media hype for The Dark Knight hijack every pixel of screen space and every second of TV time put before us, it has been an absolute joy to watch this 3 act relatively low-budget 'made for the internet' superhero sing-along.

Dr Horrible is 'the story of a low-rent super-villain, the hero who keeps beating him up, and the cute girl from the laundromat he's too shy to talk to'. Though it's called a blog, it's not. It's simply 3 acts in which the main character played by Neil Patrick Harris (Doogie Howser/How I Met Your Mother) occasionally talks to the camera in a video blog kinda way. Act 1 went live last Monday and was down in hours due to the demand on the servers. Over the week acts 2 and 3 went up and are due to be taken down at midnight tonight (July 20th).

The whole thing came from the mind of Joss Whedon, a Hollywood writer and director who has previously written  Buffy the Vampire Slayer, Toy Story, and Alien: Resurrection. He's also done quite a bit of comedy on TV including Roseanne and The Office (US). Apart from the great script, good songs and some decent one-lines what I really like about the project is that it came about as a result of the writers strike. I'll let Joss explain further...

"Once upon a time, all the writers in the forest got very mad with the Forest Kings and declared a work-stoppage. The forest creatures were all sad; the mushrooms did not dance, the elderberries gave no juice for the festival wines, and the Teamsters were kinda pissed. (They were very polite about it, though.) During this work-stoppage, many writers tried to form partnerships for outside funding to create new work that circumvented the Forest King system.

"Frustrated with the lack of movement on that front, I finally decided to do something very ambitious, very exciting, very mid-life-crisisy. Aided only by everyone I had worked with, was related to or had ever met, I single-handedly created this unique little epic. A supervillain musical, of which, as we all know, there are far too few.

"The idea was to make it on the fly, on the cheap – but to make it. To turn out a really thrilling, professionalish piece of entertainment specifically for the internet. To show how much could be done with very little. To show the world there is another way. To give the public (and in particular you guys) something for all your support and patience. And to make a lot of silly jokes. Actually, that sentence probably should have come first."

If you're the kinda person that lives by the rule of always turning a negative into a positive then the success of this story will not come as a surprise. I've often found that my best work has come through such circumstances, or through being restricted in what I can do. Though it's been well documented that restrictions on cigarette advertising produced some of the most memorable print ads of the 70's and 80's, and Dr Horrible is excellent, I'll hold back judgment on the forthcoming StrikeTV (online channel filled with content written during the strike) having watched the trailer below...

www.strike.tv Teaser from StrikeTV on Vimeo.

Bored? Stoned? Insomniac?

 

Then you've got to check Upl8 by Poke NY. I stumbled across this courtesy of Russell Davies' great post on Watching The Internet. As a 2-laptop-per-producer kinda guy I'm a shocker for having YouTube running on my mac as I work away on my PC. It's music player of choice these days. As a video player the ambient glance-able nature of Upl8 is what makes it so wonderful. I sent the link around to the team and many emailed my back saying they wished they could twist the knobs or push the buttons. I was shocked. If you want to push buttons try this or this. The real beauty of Upl8 for me is that you can't push the buttons... you just type in the url and let it flow - ambient nonsense till the cows come home. There is some functionality but you'll have to go to Iain Tait's Crackunit.com to find out how to load it with clips of kittens.

As anyone working in radio will tell you glance-able content will play a massive part in the future of radio, but there have been 2 occasions in the last few years that hammered home how important it is already, and has been for sometime. The first occurrence was in 2006 when I asked my teen son to cast an eye over the Radio 1 website and tell me what liked most. Expecting him to talk about the wealth of video, incredible event coverage or superb music content I was stunned when he pointed to the 'track now playing' feed at the top of the homepage. When I asked why he replied 'Because if a tune comes on I like I can switch off the music I'm playing and turn on the radio'. I assumed nobody would choose to listen to radio this way and put it down to him being a lovable crank.

I totally forgot about it until I did a 'meeting the public' session early 2007 where I talked to a couple of Radio 1 lovers about listening to radio via their TV. I was pretty pleased to find out that it was their favourite way of 'listening' to Radio 1 until they explained that listening via TV allowed them to turn off their own music and turn up the radio when they see a track they like appear on the 'track now playing feed' on screen.

I always thought the real value of tracklistings was aligned to music discovery or compiling your own playlists, something that would augment the experience of listening to the radio rather than a reminder to switch the radio on for the next 3 minutes.