Free Doesn't Mean Devalued

from the more-to-life-than-money dept

The concept of zero took ages for societies to recognize, let alone understand. Mike has explained before how it's been a stumbling block in economics for some libertarian and "free market" types more recently. People who think about economics in terms of scarcity get upset when abundance pushes price down towards zero, as if the economic equation were broken. But if you flip the equation and think of it as a cost of zero, you realize that the trick is to use as much of those abundant goods as possible, adding value to complementary scarcities for which you can charge. Zero doesn't break economics, it just requires a different approach.

But artists and other creators hit a different stumbling block than libertarians (libertarian artists aside...). Zero is a problem because they feel like their art is worthless; they aren't hung up on scarcity, they're hung up on "devaluation." We've heard it from journalists. I hear it most often from fellow songwriters. The economic theory makes them feel as though their work is just viewed as some sort of cheap commodity. The thing is, value and price are not the same. Price is monetary value, but value is so much more than money. Price is what gets driven down to marginal cost, but value factors into the demand side of the equation. Expensive things aren't necessarily valuable, and valuable things aren't necessarily expensive. I value oxygen a lot, but it seems silly to pay for the air I breathe each minute, given the abundant supply.

More importantly, songwriters who get hung up on "devaluation" confuse recordings with music. They equate the two. A recording is not the song, it's just an instance of it, and a digital audio file is just an instance of the recording. Equating these reduces music to recordings to files. As important as recordings are, there's so much more to music. When you think of a song, do you think of the recording, or a memory you had connecting with the music? Do you think of the file and how much it cost, or the emotions, people and experiences that the music conjures up? The recordings are just a means through which we experience the music. Songwriters (of all people!) should know that the value in music is so much more than the price of a recording. It's not devaluing music to give it away for free, but it can increase its value by allowing more people to connect with it, to know, love and understand it -- to value it. It's through that experience that music is valued, not price!

Ironically, the underlying concern ends up being economic -- how will we make money? A price of zero for digital audio files doesn't mean that no one values the songwriting profession, or that no one is willing to spend money on music and keep songwriters in business. Sharing digital audio files makes the music more valuable and leads to more opportunities for monetization. When you give music away and connect with an audience, the opportunity for monetization is in the associated scarcities -- access, containers, community, merchandise, relationships, unique goods, the creation of new music, etc. -- by giving people a reason to buy. Getting hung up on "devaluation" is a distraction from the opportunity -- the necessity -- to experiment with new business models.

So, can we please stop complaining that free means devalued?

Filed Under: free, music, value

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  1. icon
    SomeGuy (profile), 13 Nov 2009 @ 7:20am


    Value and price are not directly related, but they are connected in an elastic sort of a way. If price goes way up, it naturally will pull value up with it (trailing indicator). In the same manner, if value is lost, price is dragged down as a result.

    There's a flaw here. You say that price drags value around, then turn around and say that value drags prive around. You can't have it both ways. It seems to me that value is the more-fixed quality; you can't make people value something more just by raising the price. When gas prices go up, people buy less gas because it's not worth that much to them. When gas prices go down, people don't stop buying gas.

    Anyways, your music apocalypse, where all music sinks to the quality of garage bands, doesn't make any sense at all. Why would talented people because less talented simply because other people are bad at what they do? The Greats of the past aren't worse musicians because SOME people chose to make commercial jingles. And even if lots of people make vapid, poorly-composed music, that doesn't mean there won't be ANYONE who has something meaningful to express and the talent to do it well. And they will shine brighter for all the mediocrity around them -- and people will VALUE their art more because of the rest of the drivel being made. And when people value something, they're willing to give up their money for it; the trick is finding a way to capture that money people WANT to give you.

    The models discussed on Techdirt try to address just that scenario.

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