Somewhere between Nick Carr’s “Typology of Network Strategies” and Chris Anderson’s “Four Kinds of Free” is the secret to understanding our new economy:
Carr’s “Typology of Network Strategies”:
- Network effect
- Data mining
- Digital sharecropping, or “user-generated content”
- Complements
- Two-sided markets
- Economies of scale, economies of scope, and experience
Anderson’s “Four Kinds of Free”:
- Direct cross-subsidy (get one thing free, pay for another)
- Ad-supported (third-party subsidizes second party)
- “Freemium” (a few people subsidize everyone else)
- “Gift economy” (people give away things for non-monetary rewards)
Of course, both Carr and Anderson are building on theories and business models previously articulated by many others. A few that come to mind:
- Carl Shapiro & Hal Varian, Information Rules: A Strategic Guide to the Network Economy (1999)
- Stan Liebowitz, Re-thinking the Network Economy (2002)
- Jeffrey H. Rohlfs, Bandwagon Effects in High-Technology Industries (2001)
- Oz Shy, The Economics of Network Industries (2001)
- Don Tapscott & Anthony Williams, Wikinomics: How Mass Collaboration Changes Everything (2006)
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.