I am sitting at the library, and this thought just came up. It's a really interesting (or devastating) thought. Here we go, sit tight, and read on.
The internet offers us everything we can think of, for free! There is free streaming (Justin TV), free chatting softwares (msn), and even free kisses (kiss me in 3D). We are not going to get out of the economy crisis by having everyone watching TV shows, gossiping with friends, and kissing monitors at home.
Disagree? Think the websites that offer these free services will keep the economy rolling by making a lot of money? Let's look at this closely.
The common business model for web base businesses is to generate lots of users to create expensive advertising space, and rely on the sales of these advertising space as the only source of revenue.
Sounds like a good plan, but in the year 2009, this business model doesn't work anymore! Why?
First, we have to understand that these online advertising spaces are often ignored due to the excessive use in the past. Second, some of these ads might be advertising for a service that other websites are offering for free! These two reasons alone can explain why online advertising is not that effective nor attractive, and it just can't be relied on as the only source of revenue anymore.
So let's summarize this. Web base businesses that offer free services have an unattractive business model, and moreover, offline businesses are negatively affected by the free online services as well.
All these things will only slow down the economy.
Does anyone disagree? Please provide me a dose of optimism.
PS: Next time you wish for a free web base service, wish at your own risk, because more free services lead to a bad economy, and a bad economy leads to a smaller salary...for you.
The internet offers us everything we can think of, for free! There is free streaming (Justin TV), free chatting softwares (msn), and even free kisses (kiss me in 3D). We are not going to get out of the economy crisis by having everyone watching TV shows, gossiping with friends, and kissing monitors at home.
Disagree? Think the websites that offer these free services will keep the economy rolling by making a lot of money? Let's look at this closely.
The common business model for web base businesses is to generate lots of users to create expensive advertising space, and rely on the sales of these advertising space as the only source of revenue.
Sounds like a good plan, but in the year 2009, this business model doesn't work anymore! Why?
First, we have to understand that these online advertising spaces are often ignored due to the excessive use in the past. Second, some of these ads might be advertising for a service that other websites are offering for free! These two reasons alone can explain why online advertising is not that effective nor attractive, and it just can't be relied on as the only source of revenue anymore.
So let's summarize this. Web base businesses that offer free services have an unattractive business model, and moreover, offline businesses are negatively affected by the free online services as well.
All these things will only slow down the economy.
Does anyone disagree? Please provide me a dose of optimism.
PS: Next time you wish for a free web base service, wish at your own risk, because more free services lead to a bad economy, and a bad economy leads to a smaller salary...for you.
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