Two market structures were evaluated in our most recent discussions: classic free markets vs. “natural” markets which come at costs to society. We also evaluated Externalities and Networks. An interesting point is that Networks are clearly valuable for their great ability to connect people and ease transactions; however it should not be overlooked that they can also be used to connect people in negative and harmful ways. It was also interesting to learn that cable companies are exempt from Common Carrier Laws that apply to phone services, thanks to Telecommunications Law and successful lobbyists.
We also touched on the topic of “free” as discussed in Chris Anderson’s article “Free! Why $0.00 Is the Future of Business.” It was helpful to have even the limited class discussion about it to reiterate what we read outside of the classroom. Anderson writes about Externalities as “a concept that holds that money is not the only scarcity in the world.” And continues with: “There is, presumably, a limited supply of reputation and attention in the world at any point in time. These are the new scarcities – and the world of free exists mostly to acquire these valuable assets.” Because we can now measure the value of these scarcities, thanks to PageRank, site traffic, and ad values, they can be considered a form of currency.
Group leaders initiated conversations about the missing links between The Long Tail and the Harvard Business Review article “Should You Invest in the Long Tail?” which attempts to discount the book’s message, but mostly just confuses the argument and the reader. We also examined the article “How Not to Build an Online Market” which confirms a continued need for a human middleman in business transactions, despite technological advancements.
(On a side note: I will need to check out the movie Once, which was funded by the Irish government to encourage tourism and became an unexpected success – proving that there is a market for non-blockbusters and that what the Industry tells us that we like isn’t necessarily true.)
