Free Isn't Working

August 9, 1995 was an infamous day in the history of business. That was the day that Netscape’s IPO set lips a flutter all over the business world about this new, ingenious strategy: Give your product away for free. Now we have free browsers. free online content, free memberships, free PCs, free web TV, free internet access, free software and free music.

The idea was that if you offered your product for free, soon you would have a massive volume of "customers" and you could sell them peripheral services. But for most companies free has been a bad deal.

Newspapers conditioned readers to free web content and then realized they couldn't make enough with online advertising. MySpace just laid off 30% of its workforce because of cash flow problems. Facebook is on the rocks. Up-sell conversion rates for free software are mostly miserable. Hulu is re-thinking their free programming strategy. Free browsers are subsidized by other products the company sells.

It's time for the age of free to end. Customers have enjoyed the free ride, but most companies are realizing they just can’t survive as chumps. Newspapers need to charge subscriptions or micro-payments for their most valuable content. Facebook needs to charge a yearly subscription. Services like Hulu need to charge for their programming. Browsers and other web software need to charge for all but the most basic functionality.

It's time for media, web and software companies to realize that it's ok to charge customers for the value they get. Free isn't a strategy, it's a dead end.

1 Billion Apps in 10 Months!

Did you hear that?

It's the sound of the iPhone app revolution. Each revolution has a driving idea and here's the idea for the iPhone revolution: The next 8 times out of 10 that you use your i"Phone", it probably won't be to talk to anyone. That's certainly true for me.

Maybe it's wrong to even call it a phone since talking on it is secondary. We'd rather use it to charge a credit card, straighten a picture frame, catch last night's Family Guy, buy movie tickets or check the weather in Cuzco Peru.

Apple has sold 1 billion apps in 10 months. I haven't checked, but wouldn't the adoption curve for that be close to vertical?

The Secret to the "New Marketing".

Seth Godin's blog post this morning perfectly captures the state of marketing today; Be real or be gone.

Fancy-schmancy launches and big ad budgets are bowing to the simplicity of creating a product that works enough for people to talk about with social networking tools. It's no longer being famous for 15 minutes, it's being famous to 15 people.

Here's Seth's post...

This, in two words, is the secret of the new marketing.

Find ten people. Ten people who trust you/respect you/need you/listen to you...

Those ten people need what you have to sell, or want it. And if they love it, you win. If they love it, they'll each find you ten more people (or a hundred or a thousand or, perhaps, just three). Repeat.

If they don't love it, you need a new product. Start over.

Your idea spreads. Your business grows. Not as fast as you want, but faster than you could ever imagine. This approach changes the posture and timing of everything you do. You can no longer market to the anonymous masses. They're not anonymous and they're not masses. You can only market to people who are willing participants. Like this group of ten.

The timing means that the idea of a 'launch' and press releases and the big unveiling is nuts. Instead, plan on the gradual build that turns into a tidal wave. Organize for it and spend money appropriately. The fact is, the curve of money spent (big hump, then it tails off) is precisely backwards to what you actually need.

Three years from now, this advice will be so common as to be boring. Today, it's almost certainly the opposite of what you're doing.

Robots - Fascinating and Creepy

The military is using a new robot pack mule called BigDog in the high elevations of Afghanistan. This machine was designed as a supply transport aid to troops as they pass over rough terrain on foot.

I'm in awe of how this thing moves, almost exactly like a lama or deer. It uses a laser gyroscope, robotic brain and locomotive sensors to "walk" over rocks, on ice and snow, and up steep pitches. You can't even kick it over. Watch this video and take inventory of your emotions. For me they ranged from unease to fascination to even sympathy as I rooted for it to find sure footing on the ice almost as if it were a live animal. But mount a machine gun on this sucker and it would be straight out of your worst nightmare.

Within 15 years, robots will play a significant role in our lives. They will assist the handicapped, conduct dangerous work (like today's bomb unit bots), assemble products in 100% automated factories, perform low-invasive surgery, help grow our crops and perform routine household tasks.

And as that famous Simpsons clip says: I, for one, welcome our new robot overlords.

Product Line Extension Gone Too Far

Here's what happens when you milk a successful product line one time too many. Plus the packaging is bad because it doesn't tell you if the force is the light or dark side. It's surely a choking hazzard.

Yes, I know these aren't real products, but they're still funny.

Microsoft's Vision Of 2019

Some interesting ideas in this footage from Microsoft with their vision of what to expect by 2019. 10 years doesn't seem too far away and this is a lot to break off, especially considering they still have yet to make a good web browser.

<a href="http://video.msn.com/?mkt=en-GB&amp;playlist=videoByUuids:uuids:a517b260-bb6b-48b9-87ac-8e2743a28ec5&amp;showPlaylist=true&amp;from=shared" target="_new" title="Future Vision Montage">Video: Future Vision Montage</a>

Toy Blocks that Think and Talk to Each Other

And you thought Legos were cool. This may inspire a whole new generation of toys, math aids, video games, presention tools and marketing campaigns.