Tagecosystem

On freebies, externalized costs and carrying your own weight

O

There’s one slightly awkward dark side in the conference business: Over the last few weeks many, many people asked me for freebies of one sort or another. That’s not unusual or unexpected: Being involved in three conferences, there are always some who cannot afford or don’t want to spend the money for tickets.

But what genuinely surprised me is the profiles of the people who asked.

A trade or a freebie?

I expected mostly educational organizations or charities asking, which is perfectly fine because if at all possible, of course I want them to be able to participate. It’s not always possible at the desired scale, but usually there’s some wriggle room. We had some of that, and it lead to a large student presence at ThingsCon for example, and lots of students at UIKonf, too.

What I also often see is a proposal of a trade of some wort. Free access in exchange for XYZ. I hasten to add that the goes for conference organizers like me, too, who often ask speakers to speak for free in exchange for something or another like attention, travel, meetings, etc. This can all work out nicely if the chemistry is right.

But this time ’round, it wasn’t charities or schools or students asking for free access. It was predominantly for-profit companies, startups and even a surprisingly large number of venture capitalists. This struck me as deeply disturbing on many levels.

Externalizing costs for future profit

As an early stage startup, being bootstrapped is a fact of life. It’s both normal that people (like conference organizers) accept that and try to help out. It’s also clear that the so-called bootstrapping phase is a calculated move by the founders that serves the purpose of getting a maximum of product, traction, reach or attention before inviting investors, ie. it’s a conscious investment into future financial leverage (through exits or otherwise). In other words, bootstrapped startups asking for special treatment externalize their costs – in exchange, really, for largely nothing. It’s not like they’ll pay for other startups or educational institutions or the company behind a conference once the money comes rolling in. Still, that’s something we are all happy to help with, after all many of the founders are our friends, and it could be one of us one day. So that’s all good.

Can you trust a VC who wants a free ride?

But then there are the surprisingly large number of VCs and related companies who not only have the budget, but make it their business to invest this same budget, who ask us for free access to our conferences, in exchange for absolutely nothing at all. This, frankly, disgusts me personally – more importantly though, it makes me wonder: If a company doesn’t carry a minimum of their own weight by even just purchasing a ticket to a conference that’s commercially relevant for them – if, in other words, a company is too stingy to play a valuable role in the ecosystem but rather actively damage it – then how can we trust them not to screw over their investees?

The number of people who approached me saying their (investment or incubator or large tech) companies are “running lean”, or “think like a bootstrapped startup”, or “are there to help startups” and hence should get through the door “for free” was staggering.

“For free” is anything but.

Of course “for free” in this case isn’t free at all. Every person in the room incurs a significant cost. That very real cost usually is much higher than you’d expect from the outside. (Even after years of doing this, it surprises me.) No, “for free” means “free of charge for this particular attendee, at the cost of someone else”.

Depending on how we handle this kind of “free” on the organizers’ side, this could mean that we eat the costs (ie. take it out of our own pockets), or that we externalize it even further by passing on the costs to the other attendees. That latter of course would mean punishing the honest, fair ones who contribute their share.

Would you ask a stranger for money on the street?

There’s a very simple test I apply if in doubt. I try to imagine what it would feel like if I did the same to a stranger on the street. In this case, would I ask a stranger to just hand me over 300 Euros for no good reason whatsoever? Maybe because I don’t feel like I should be spending my own money?

That’s what asking for a “free” ticket is. It’s asking someone to pay for you. Which can be perfectly fine for all kinds of reasons, or it can be really, really totally off. It’s all about the context.

A thank you to all of you who contributes their share!

Of course, for every VC and startup who asks for a freebie, there are dozens who don’t, who contribute their share, and put their money where their mouth is. To those I say: <3. You’re the reason we keep doing this stuff.

iPad, Wired App, ecosystem. Or not.

i

Igor and the iPad

I’m a big fan of Wired. I read it online all the time, I used to have a Wired US subscription (that didn’t work out that well both in terms of shipping times and price, at about 10 times US subscription prices with shipping). These days, I have a subscription to Wired UK that I’m very happy with. So I was really curious about the next steps for the digital version of Wired. The iPad app promised to be just that. So while my Twitter feed starts filling up with posts about the first batch of iPads arriving in Germany, I took the time to read up a bit.

And ended up writing a rant on the iPad’s product philosophy. Please note that I don’t own an iPad, I’ve only ever played around with one on a few occasions.

The Wired iPad ap is like a CD-ROM from the 1990’s

Interfacelab has a great rant analysis of the much-hyped Wired iPad app. The Wired app doesn’t get the best review here. I’d like to quote the whole thing, it’s that good. But I’ll try to stick to the most important parts:

I’m starting to believe that the physical magazine’s “interface” is vastly superior to it’s iPad cousin. However, what strikes me most about the Wired app is how amazingly similar it is to a multimedia CD-ROM from the 1990’s. This is not a compliment and actually turns out to be a fairly large problem… ( …) There are certain interactive elements to the articles, but – and I apologize to all of the people who put in a lot of back breaking work into this – they’re pretty lame. Tapping on a button-looking element switches out part of the page with another image. You can drag your finger across certain images to make them sort of animate like a flipbook (and in truth, that’s what it is – a series of PNG or JPEG images). There are videos you can tap on to view fullscreen. There are audio clips that you can play. The interactivity in the Wired application is very 1990’s.

It’s not interactive, it’s a slide show

This is very true – I’m told the whole magazine doesn’t only not feel all that interactive: it just isn’t. It’s just a slide show. Which explains the huge size of the Wired app. Just to do some quick & dirty math: If you own the smallest iPad with its 16GB of memory and pack it with 20 movies (say 500MB each) and 10 magazines (Wired: 500MB), it’s full. You couldn’t even fit any music on then. Just saying.

A side note: The iPad’s main line of defense usually is it’s supposedly inspiring and groundbreaking design. But look at it – is it really that amazing? As Cory Doctorow points out (TWIT #249), it’s really only a “moderately well-assembled piece of south-Chinese electronics.” It’s a classic effect of glossy, fullscreen video that we go “aaaah, ooooh”, but does it really live up to the expectations?

What Apple is building is not an ecosystem, but a zoo

What’s more, of course, is that the iPad is built to be a part of the iTunes ecosystem – if you want to use that term in this context. An ecosystem is a living, breathing thing that can sustain itself; it’s has by definition an element of chaos, of not being controlled. The iTunes system is the opposite. The more appropriate metaphor might thus be: a zoo. You can look, but you can’t touch. (Ok, you can point.) You certainly can’t really interact with the animals except for shooing them back and forth within their cages.

If you buy an iPad, you don’t really buy a device. You most importantly buy into a system of software, services and contracts. The iPad is built around iTunes, which most certainly is an only moderately well-assembled piece of software. You must know, buying content through iTunes, that you will never be able to leave iTunes/Apple and take the stuff you bought with you. You will either always have to depend on Apple, or you will need to leave behind whatever you bought – every song, every book, the Wired app – if you move on to the next new system. Apple won’t be around forever. But maybe you appreciate a fresh, clean plate every now and then.

Maybe you also like burning down your house with all your belongings in them whenever you move.

The points above apply, by the way, equally to consumers and developers.

Jeff Jarvis, never short of a good quote, summarizes it graphically as always (sorry, no penis quote here):

I see the iPad as a Bizarro Trojan Horse. Instead of importing soldiers into the kingdom to break down its walls, in this horse, we, the people, are stuffed inside and wheeled into the old walls; the gate is shut and we’re welcomed back into the kingdom of controlling media that we left almost a generation ago.

The question is: Can large corporations compete with amateurs?

So what’s at the core of all this this? Why do these “multimedia” (is that term still around?) apps feel so… stale? Maybe economics, pure and simple. As Danny O’Brien points out, technology often makes production of digital goods much cheaper – for amateurs. At the same time, production costs for professional products often skyrockets:

But can you re-gear a newspaper or a publishing house to produce the level of interactive complexity that a $5 app is going to demand, when it is competing with games and films in the same app niche? Honestly, it might be possible. We’re not in the age of CD-ROMs now. Our price-points are all over the shop, and a sealed environment like the iPad permits all kinds of unnatural pricing inversions. We’ll pay more for a ringtone than a full MP3. We pay $10 for a README file on our Amazon Kindle, and a dollar for a pocket application that plays farts. But if you want to play that game, you’re running against the clock. Other applications are going to make yours look ridiculously clumsy in a matter of months (honestly, in a year people will be amazed anyone paid $14 for a bunch of text, a rotating picture of a rock, and a quick Wolfram Alpha search). Plus the seals on that environment get corroded by open competition every day.

The announcement by One Laptop Per Child (OLPC) to be building a $75 Android-powered tablet for developing countries might just be a point in case. (Their first model wasn’t all that great and not very successful, but arguably has contributed strongly to the mainstream development of netbooks.)

So why does everybody (or rather: journalists) look so enviously at the iPad? Is it really the big hope, or are journalists (sorry for the generalization) really just too desperate to think clearly? In Cory Doctorow‘s words:

I think that the press has been all over the iPad because Apple puts on a good show, and because everyone in journalism-land is looking for a daddy figure who’ll promise them that their audience will go back to paying for their stuff. The reason people have stopped paying for a lot of “content” isn’t just that they can get it for free, though: it’s that they can get lots of competing stuff for free, too. The open platform has allowed for an explosion of new material, some of it rough-hewn, some of it slick as the pros, most of it targetted more narrowly than the old media ever managed.

Or as the Information Architects put it, referring to the iPad edition of Wired:

The future of journalism is definitely not a stack of banners spiced with videos, exported from a paper layout program. You need to try harder.

Don’t get me wrong. By now I’m all infected with the excitement about the form factor of a tablet. I never thought I’d say it, but I do see a niche in my life where the tablet fits in. But it has to be more open. If I use a device to store all my content, if it is my direct way of accessing culture in all its forms, I have to really own it. And I’m not even talking about taking apart (I think it’s important that’s possible, but I hardly dare doing that) or installing Android on an iPhone. But I like a world where that is possible. I mean you should be able to install what you like, and take your music along to the next device you get.

I just can’t have a company being able to pull the plug on me with a software update anytime they choose to do so.

Image: Igor, who doesn’t like iPads the least bit, in the tempting glow of an iPad, a Creative Commons Attribution Share-Alike (2.0) image from mbiddulph’s photostream