Sunday, April 22, 2007

When Something is Free Online

I read the article entitled when something is free online. This article talked about the fact that nothing on the internet is free and it talked about the reasons why companies choose to give things away for "free." The reasons that were given by the article are:

1. For Linking.
Offers may be given for free in exchange for a link that goes back to their website. The example given was, when an author chooses to allow their publication to be viewed for free they request that a link be on the page that sends the reader back to their own page, this gives them revenue.

2. For Ad Revenue.
This is when a company gives away a free product on their page so that people come to the site and see their ads. The more people that visit the page and get the free product the more revenue is generated by people seeing the ads.

3. For Goodwill Branding/ Public Relations.
Companies will sometimes give away a product, or service for free to get media attention. This generates free publicity and gives the company the chance to be seen by a large audience of people.

4. For Contact Information.
Companies may choose to give an item away for free so that they can gain access to the persons contact information and therefore, be able to send the person more information on their product and other services.

The article also gave information about why things that are free online are not always good. Sometimes giving away something for free is bad either for the company or the individual. If either finds that the costs outweigh the benefits of offering a free product the following will happen:

1. Abondonment - the company will stop offering the free item completely.
2. Compensation - the company will request that the individual pay for the product or service after a certain time limit has been reached.
3. Cut Corners - the company will try to make up for the money lost by offering a "free" product that is of inferior quality.

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