Scarcity, Abundance And The Misapprehension Of Online Advertising

In the latest offering to the gods and goddesses of I pose the following question: What if the business model for news ain’t broke?

My chosen text is Free: The Future of a Radical Price, in which author Chris Anderson makes a strong case for “freeconomics”. Indeed he argues that an ad-funded model can be a profitable business for newspapers – and other non-media firms – online. This despite what the newspaper groups are saying themselves.

This is the crux of the piece:

Offline – in newspapers, magazines, billboards, TV and radio – advertising is predicated on scarcity not abundance. Ad sales people trade on ’space’ and the less there is the higher the yield.

So when there is infinite space online, their greatest selling tool disappears.

Right? Wrong.

Click here to find out why it’s wrong.

By the way, there are some good comments at the bottom of the piece which are worth staying on for. Not least from Paul Lomax who makes a strong case for brand advertising online, something I’d rather dismissed in my original piece.