Cars for Free? Introducing the Truly Innovative
Many companies claim to desire out-of-the-box thinking from their employees. But it's hard to be truly innovative. Yesterday, Wired editor Chris Anderson (recently in the news for publishing the email addresses of lazy PR flacks and famous for authoring business best-seller "The Long Tail") uses his personal blog to continue the search for the genuinely revolutionary by looking at the idea of giving stuff away for free.
Of course, the debate over what content should be available for free has been raging in the media world for years. We've blogged about it a number of times (here's one on Radiohead's decision to let fans pay what they want), and Anderson points readers to a discussion of the issue on the blog of Tim O'Reilly, CEO of O'Reilly Media. The post, aptly titled "Free Is More Complicated Than You Think," itself points to Dilbert creator Scott Adam's recent discussion in the Wall Street Journal of the costs and benefits of making his work available for free (subscription required). The conclusion of all these smart guys thinking together, as expressed by O'Reilly:
We find that making a book freely available can help visibility and sales of a book on a little-known topic, but for a well-known topic or author, who benefits little from the additional exposure (like Scott Adams), it can have a slight cannibalization effect on print sales.... The point is that we need more than one model. There is no one-size-fits-all answer.Making money by giving stuff away for free is complicated, and it's yet to be fully mastered, but as Anderson points out its also an innovative and expanding business idea worthy of consideration in contexts outside media. We already get cell phones for free in exchange for signing a service contract, why not get an electric car for free to lock you into paying for the energy to run it? That's the idea of Shai Agassi, chief executive of SAP. Anderson explains that, with the price of gas so high, cars',
purchase price is now a small fraction of their lifetime costs. Shai's company is taking a bigger view of the business they're in--rather than selling cars, they're selling personal transportation, and charging a rate proportional to use. When fuel seemed nearly free compared to price of the car, companies sold cars. Now cars seem nearly free compared to the cost of the fuel. Thus an opportunity for a car company that thinks different.It's a fantastic example of out-of-the-box thinking, and begs the question: what other industries are ripe for re-imagining?
(Image of electric vehicle charging station by hotzeplotz, CC 2.0)