When the Web was first commercialized, it was relatively easy to support web sites with a mix of paid subscriptions, e-commerce, and advertising. The diverse mix reflected an organic model that essentially required serving the interests of the customer. A rational ecosystem was soon emerging that tempered the more destructive dynamics of the network effect.

Then a trillion dollars flooded the medium from venture firms, investment banks, billionaires, multi-nationals, university endowments, and pension funds. Not to be left out, governments and non-profits joined the stampede and the greatest price war in human history ensued. Within a couple of years, if one didn’t have a Web site competing to give intellectual capital away for free; subsidized entirely by other means, it just wasn’t socially acceptable—knowledge wanted to be free. Well folks, much like freedom, knowledge isn’t free.

By the late 1990s when the then wealthiest person on the planet (Bill) said something like “let’s sling it (capital) against the wall to see what sticks”, all rationality had left the planet. I was embarrassed by and for my society. It was the perfect storm for a new emerging model where content providers by the billions—eventually every organization and human in the world it seemed, would feel compelled to compete in giving away their most valuable intellectual capital for free. And we all took the bait.

Fundamental economics

The small town newspaper model was no accident, rather it evolved over generations into a self-supporting medium that served the interests of the community above all else. With a mix of classifieds, banner advertising, and paid subscriptions, editorial was relatively free from any group of dominant forces. Yes, eventually many became entrenched monopolies that abused power, forced personal ideologies on others, and by extension threatened free speech, particularly when the same owner acquired local radio and TV stations. The model needed competition badly, not from halfway around the world, but rather from the local community. Instead of supporting sustainable competition, and reducing dependency, most people slammed the door on the paper boy/girl. Petty, ignorant greed is at it again, but this time it’s happening on a massive global scale.

Free global web sites supported by any means other than their communities are open to manipulation, predation, extended ideology, and ultimately, as ironic as it sounds—threatens our very freedom as individuals, communities, and nations.  Self-supporting economies are the primary defense of independence, freedom, and liberty, and are almost always more effective at regulating communities than the enforcer of last resort; aka the military.

As consumers of information on the Web, we have all been exploited by the largest price war in human history. For a decade and a half  now we have consumed and then demanded free intellectual capital that required enormous investment to produce, quite often at the expense of our neighbor’s job or business that formerly supported the local community in a myriad of ways that cannot be replicated by a global computer network. It may not be obvious, but one free article, software application, or brain surgery, when performed well, can represent generations of investment, save lives and jobs, and yet we demand it for free.

Predictably, driven by the free model in a global computer network, the highest levels of intellectual capital are increasingly unaffordable by the majority, and moving offshore where billions of others can be exploited. This trend represents a massive transfer of wealth that supports everything meaningful in society, including ultimately I fear; world peace.

The Web isn’t evil, but reliance on a free model always has been—representing a wolf in sheep’s clothing. Support your neighbor by voting with currency, not clicks. The next job, industry, or nation could be yours.

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