Friday, October 31, 2008 - The Progress & Freedom Foundation Blog

New Economy Business Models (Carr vs. Anderson)

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":

  1. Network effect

  2. Data mining

  3. Digital sharecropping, or "user-generated content"

  4. Complements

  5. Two-sided markets

  6. Economies of scale, economies of scope, and experience

Anderson's "Four Kinds of Free":

  1. Direct cross-subsidy (get one thing free, pay for another)

  2. Ad-supported (third-party subsidizes second party)

  3. "Freemium" (a few people subsidize everyone else)

  4. "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:

posted by Adam Thierer @ 10:46 AM | Books & Book Reviews , Economics