How and why giveaways are changing the rules of business
Asimple lyric explains the dynamic driving so much innovation in today's post-industrial marketplace: "The best things in life are free."
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Never in history has so much innovation been offered to so many for so little. The world's most exciting businesses - technology, transport, media, medicine and finance - are increasingly defined by the word "free". Whereas WalMart, the world's largest retailer, promises "everyday low prices", entrepreneurs and ultra-competitive incumbents develop business models predicated on providing more for free. It is a difficult proposition to beat.
Google charges users nothing to search the internet; neither does Yahoo nor Microsoft MSN. E-mail? Instant messaging? Blogging? Free. Skype, the Luxembourg-based company that is now a multibillion-dollar division of Ebay, offers free VOIP - Voice Over Internet Protocols - telephone calls worldwide. San Francisco-based Craigslist provides free online classified advertising around the world.
In America, the Progressive insurance group gives comparison-minded shoppers free vehicle insurance quotes from its competitors. Innumerable financial service companies offer clients free tax advice, online bill payments and investment research. Michael O'Leary, Ryanair's colourful founder, predicts his discount carrier may soon offer free tickets to his cost-conscious euro-flyers.
Of course, Milton Friedman, the Nobel economist, is right: just as "there's no such thing as a free lunch", there is also no such thing as a "free innovation". These "free" offerings are all creatures of creative subsidy. Free search engines have keyword-driven advertisers. Financial companies use cash flow from profitable core businesses to cost-effectively support alluringly "free" money management services. Ryanair counts on the lucrative introduction of in-flight gambling to make its "free tickets" scenario a commercial reality. Innovative companies increasingly recognise that innovative subsidy transforms the pace at which markets embrace innovation. "Free" inherently reduces customer risk in exploring the new or improved - and bestows competitive advantage. To the extent that business models can be defined as the artful mix of "what companies profitably charge for" versus "what they give away free", successful innovators are branding and bundling ever-cleverer subsidies into their market offerings. The right "free" fuels growth and profit. Technology has successfully upgraded King Gillette's classic "razor & blades" business model.
All this freedom poses provocative challenges for global regulators and economic development champions. One company's clever cross-subsidy is another's anti-competitive predatory pricing. Ingenious subsidies inevitably invite invasive scrutiny. Look at Airbus and Boeing. American and European trustbusters certainly frowned on Microsoft's successful bid to bundle "free" internet browsers into its dominant Windows operating system. Yet bundling "free" e-mail and other "free" online services into Yahoo and Google search engines was deemed legitimate. In trade competition, not all "frees" are created equal. Europe's proposed "Google-killer", the Quaero search engine initiative, for example, is itself a créature de subvention. "Free" competition with Google, Microsoft and Yahoo could prove expensive. However, regulators might argue that the ever-growing suites of cross-subsidised "free" digital innovations proffered by these companies unfairly compete. That is, these search engineers could take cash from their most profitable keyword advertising and use it to offer "free" Quaero-like multimedia searches. Good for cost-conscious searchers, yes; not so great for state-supported competitors.
The simple reality is that technology will continue eroding entry barriers to provocative cross-subsidy. The more digital or virtual a process, product or service, the faster and easier crafting clever subsidies become. Scale matters, too. Global scale facilitates global subsidies. Just as advertisers subsidise free Google searches, marketers can easily download advertising-supported "free" songs, videos and games into iPods, Sony PSPs and Nokia phones. Internet-based telephone calls similarly lend themselves to sponsorship: "This free call from your brother inNew York is brought to you by Tesco . . . please press #1 to accept . . . " While that prospect will not thrill traditional telecommunications companies, consumers might appreciate the "free" choice.
Opportunities to add "free" value that matters in a networked world are expanding exponentially. Why wouldn't Ikea, the Swedish furniture giant with a reputation for horrible DIY documentation, want to post free instructional videos on its websites to make it less risky to buy its unassembled wares? By definition, successful companies are better positioned to subsidise such "free" innovation to deter potential rivals. Competing against "free" is hard. Consequently, complaints of unfair competition will multiply as innovative subsidy facilitates technical innovation.
The emerging "economics of free" thus creates policy quandaries for emerging economies. Do developing countries want to enjoy and exploit the economic benefits of "free" telecommunications and information for their citizenry and workforce? Or are "free" search and e-mail services merely post-industrial counterparts to the agricultural subsidies undermining a nation's ability to grow its own digital entrepreneurs? Might China or a South American coalition complain to the World Trade Organisation that a Yahoo and Google were effectively dumping their services in ways that unfairly hurt indigenous industrial development?
Certainly, the "free" market paradigm is finding its way into the business plans of local Asian and Indian innovators in telecommunications, microfinance and other sectors. The work of C. K. Prahalad, the US-based management expert, on profitably bringing innovation to the bottom of the pyramid has inspired even established incumbents such as Unilever and Procter & Gamble to redefine "free" promotion in emerging markets.
The rise and intricate complexity of government subsidies in public life is increasingly provoking political controversy. Similarly, the private sector's growing dependence on cross-subsidy as an innovation edge seems guaranteed to provoke a regulatory and litigatory backlash. Ironically, free markets create markets for "free" that conjure the spectre of unfair and anti-competitive subsidy. That conflict is inherently unavoidable. But while "free" has its costs, this century's economic reality is that the surest sign of dynamic innovation is a sector where everyone - producer and consumer alike - eagerly awaits what is offered for "free".
The writer, a lecturer and adviser on the economics of innovation, holds academic posts at both MIT and KTH, Sweden's Royal Institute of Technology
天下也有免费午餐？
“
人生中最美好的事情都是免费的，”――这句简单的歌词，阐明了如今后工业市场（post-industrial marketplace）上诸多创新背后的推动力。
那么多的创新以如此低的价格为这么多人提供服务，在历史上从来不曾有过。世界上最激动人心的商业领域――技术、运输、媒体、医药与金融――正日益成为“免费”的代名词。尽管全球最大的零售商沃尔玛(WalMart)承诺“天天平价”，但创业家与极具竞争力的老牌企业，都在开发以“提供更多免费产品为基础”的商业模式。这是一个难以驳倒的命题。
用户不花一分钱，就能使用Google搜索互联网，雅虎(Yahoo)和微软(Microsoft)的MSN也不要钱。电子邮件？即时通讯？博客？统统免费。总部位于卢森堡的Skype公司，现在是Ebay旗下规模达数十亿美元的业务部门，它向全球提供免费的VOIP电话(即基于互联网协议语音，Voice Over Internet Protocols)。总部位于美国旧金山的Craigslist免费提供全球的在线分类广告。
在美国，Progressive保险集团为爱货比三家的购物者，免费提供竞争对手的汽车保险报价。数不清的金融服务公司为客户免费提供税务咨询、在线账单支付和投资研究。瑞安航空(Ryanair)生性活泼的创始人迈克尔?奥莱利(Michael O’Leary)预言，他的廉价航空公司也许很快就会为精打细算的欧洲航空旅客提供免费机票。
当然，诺贝尔经济学家米尔顿?弗里德曼(Milton Friedman)是对的：正如“天下没有免费的午餐”，天下也没有“免费的创新”。这些“免费”服务都是创新补贴的产物。关键词推动了免费搜索引擎的广告客户。金融公司利用利润丰厚的核心业务现金流，有效而划算地支持了诱人的“免费”资金管理服务。瑞安航空期望通过引入利润丰厚的机上赌博，让“免费机票”成为商业现实。创新企业日益认识到，创新补贴改变了市场接受创新的速度。“免费”天生就能降低顾客在发现新生或改进事物上的风险，还能带来竞争优势。可以这么说，商业模式可以被界定为“企业可获利的收费”与“免费提供服务”的巧妙结合，成功的创新企业正在打造日益高明的补贴，并将它们捆绑到提供给市场的服务中去。恰当的“免费”推动了增长与利润。技术已成功升级了金?吉列(King Gillette)经典的“剃刀与刀片”（razor & blades）业务模式。
所有这些自由权利，对全球的监管机构与经济发展领先国家造成了严峻的挑战。一家公司精明的交叉补贴，会成为另一家公司的反竞争掠夺性定价。创新补贴会不可避免地招致别人要求审查的结果。看看空客(Airbus)与波音(Boeing)。微软成功地将“免费”互联网浏览器，捆绑到了其占据统治地位的Windows操作系统中，对此美国与欧洲的反垄断官员当然会不满。然而，把“免费”的电子邮件与其它“免费”在线服务，捆绑进雅虎与Google的搜索引擎却被认为是合理的。在贸易竞争中，并非所有的“免费”都是平等的。例如，由欧洲提出的“Google杀手”――Quaero搜索引擎计划本身就是补贴产物(créature de subvention)。与Google、微软和雅虎的“免费”竞争最终可能代价高昂。然而，监管机构也许会指出，上述公司提供的整套交叉补贴“免费”数字创新在不断增多，而且都在不公平竞争。换句话说，这些搜索引擎能够从利润最丰厚的关键词广告业务上获得资金，并用它来提供“免费”的、与Quaero类似的多媒体搜索。没错，这对关注成本的搜索用户有利，对得到政府支持的竞争对手则不太妙。
简单的现实是，技术将继续侵蚀具有争议的交叉补贴的门槛。过程、产品或服务越是数字化或虚拟化，炮制高明的补贴就越是迅速和简单。规模也很重要。全球规模推动了全球补贴。正如广告商补贴了免费的Google搜索，经销商能够轻易将由广告支持的“免费”歌曲、视频和游戏下载到iPod、索尼(Sony)PSP和诺基亚(Nokia)手机。同样，基于互联网的电话也把自己交给了赞助商：“这是您的兄弟从纽约打来的免费电话，由特易购(Tesco)提供赞助……请按?1接听……”虽然这种情况不会使传统电信公司感到兴奋，但消费者或许能享受“免费的”选择了。
附加“免费”价值在网络世界里很重要，这种机会正以指数级的速度增长。宜家(Ikea)是瑞典的家具业巨头，以其令人头痛的DIY文件而闻名，但为何宜家不愿把免费的安装指导视频放到它的网站上，以减少购买未组装货物的风险呢？成功企业，顾名思义，在补贴这些“免费”创新，阻止潜在对手方面处于更有利的地位。与“免费”竞争是困难的。因此，随着创新补贴推动了技术创新，对不公平竞争的抱怨就会成倍增加。
因此，新兴的“免费经济学”，给新兴经济体造成了政策窘境。发展中国家愿意享受和利用“免费”电信和信息为其公民和劳动力带来的经济利益吗？或者“免费”搜索和电子邮件服务，不过是后工业化时代的农业补贴，会削弱一个国家培育自身数字企业家的能力？中国或南美洲国家联盟会向世界贸易组织(WTO)申诉，说雅虎和Google实际上在倾销它们的服务，不公正地伤害了本土产业的发展吗？
当然，“免费”市场模式正在进入亚洲和印度，当地的创新者在电信、小额信贷及其它产业的商业计划中开始采用这种模式。驻美国的管理学专家C?K?普拉哈拉德(C K Prahalad)的著作阐述了通过将创新引入社会底层并有所赢利，激起了联合利华(Unilever)和宝洁(P&G)这样的老牌企业为新兴市场的“免费”促销重下定义。
政府在公众生活领域的补贴在增长，而且错综复杂，这日益招致了政治上的争吵。同样，私人部门不断依赖交叉补贴作为创新优势，似乎肯定会招致监管和诉讼反弹。具有讽刺意味的是，自由市场创造了“免费”市场，却招来了不公正和反竞争补贴的幽灵。这种冲突本质上无法避免。不过，尽管“免费”有其成本，本世纪的经济现实是，活跃创新最可靠的迹象是这样一个部门：人人(生产者和消费者都一样)都热切期待“免费”服务。
作者系创新经济学讲师和顾问，在麻省理工学院和瑞典皇家理工学院(KTH)任职。
