The four kinds of free

…In the previous video, I talked about the economics of…free, which is basically the theory that if you give…something away for free, then it will incentivize the receiver…of the free product to come back, and purchase something else.…The economics of free is a central premise in…the new music business economy, especially for a young artist.…In order to take advantage of the concept.…You have to understand that there are actually four kinds of free.…The first one is to give something away to sell something else.…This has been around for hundreds of years.…But, the classic case is giving the razor away to sell razor blades.…

Or, the more recent version, when a mobile company provides a cell…phone at a very low cost in order to sell the monthly service.…Free number two is where the advertiser subsidizes the product.…While broadcast television might seem free, advertisers spend billions…of dollars behind the scenes to pitch to its viewers.…Many trade magazines are like this as well.…With the book given away for free, because it's subsidized by advertisers.…