Free with Advertising--3rd Party Pays

graveads3eek-poke.jpg This type of no-cost software is most similar to the model used in the traditional media that we experience everyday. Most radio and television comes to us free to air ( not counting costs from cable/satellite) and newspapers' actual costs are highly subsidized by advertisers. What these organizations do is sell consumers to advertisers. According to Chris Anderson in Free:The Future of a Radical Price, "Economists call such models 'two-sided' markets because there are two distinct users groups who synergistically support each other: Advertisers pay for media to reach consumers, who in turn support advertisers. Consumers ultimately pay, but only indirectly through higher prices on products due to their marketing costs." (p 25)
While we are on sites like Facebook, YouTube and Google that include advertising, users may believe they can block those ads out, but the fact is a certain percentage of the messages get through or marketers would stop using them. As John Wanamaker said in the early 1900s, “Half the money I spend on advertising is wasted; the trouble is I don’t know which half.”

When many Web 2.0 companies start up, they are completely free just to attract a pool of users. Overtime, making money becomes necessary. There are a number of ways that can be accomplished. One method is to have advertising and to track user behaviour to create user profiles that can be used in database marketing. With information specific to users, marketers are able to better target users. Consider a company like Amazon that tracks a user's every step and creates a page with recommendations based on that user's behaviour as well as information based on what other users who have made similar purchases have done. The company that collects information on users can also sell that information to others who would seek to market to specific target groups.

Anderson (2009) also describes how "Google makes so much much money advertising on a handful of core products - mostly search results and ads that other sites place on their own pages, sharing the revenues with Google" (p. 123)... "Every blog post put up is more information for Google's Web crawler to index, [which helps] give better search results. Every click in Google Maps is more information about consumer behaviour, and every email in Gmail is a clue to our human network of connections, all of which Google can use to help invent new products or just sell ads better" ...The initial studies on Google News said that people who use Google News were twice as likely to click on search ads on a subsequent search..."(p. 125) ... "The appeal of Google's phenomenally successful AdSense program is that it matches ads with content...Readers love it - its called relevance" (pp. 137-138). "New services actually start with geek fantasy questions like 'Would it be cool?,' 'Do people want it?' 'Does it use our technology well?' They don't start with the prosaic 'Will it make money?'" (p.119-120).

The connections of these free for advertising models run deep. They are not only limited to online; their connections run through other media. According to Wayne Friedman of MediaPost, "A new "Social TV" report from media researcher Futurescape says the next leap in the social-marketing world is pursuing the business of "social television," tapping into an $180 billion worldwide ad market. The research company says Google TV and other connected TV systems will put Facebook and Twitter targeted ads on TV screens. Futurescape predicts the next wave of TV's transformation will come from social recommendations and other consumer tools to find new TV content. The global TV business is projected to be a cumulative $250 billion by 2014. Social networks are dramatically changing marketing of TV shows. "Facebook and Twitter buzz affects TV ratings, while broadcasters that use the social networks for viewer engagement are effectively sharing their audiences with them," the report says. " Futurescape believes that television is becoming a social device. (MediaPost, July 7, 2010)


What are the advantages and disadvantages of Free with Advertising for educators?

One advantage to using sites and applications that come free with advertising is that many of these are popularly used in the general public. Students are familiar with the sites and use them already, so integration is easy as long as the sites or applications have educational application and are not blocked by the institution. Many sites have a large repository of media that is relevant and easily accessed which makes them appealing for instruction. A site like YouTube that has short clips that can be used to illustrate a single point can save a teacher much time. In the past a teacher may have had to have a full movie on a DVD, then cue it up to the particular segment. A teacher of media today is able to illustrate many points with the short snippets available. It is even possible to manipulate the URL of a YouTube video and have it begin at a precise location.(See Starting a YouTube video at a particular point) Many Free with Advertising sites also have the advantage of being able to host users' multimedia work. No cost hosting provides an opportunity for students and teachers to show or reuse the work at any time. Individual users maintain control of their own work when it is not hosted within closed educational institutions. Companies hosting materials also encourage openness, sharing and collaboration.

While all the available information is beneficial, the fact that it is surrounded by advertising can be problematic especially to those teaching lower grades. If a teacher is showing a video on a large screen with advertising, there is no control that the teacher has over the types of ads which may appear. One way to eliminate this problem is for the teacher to start a blog and embed videos in the blog. That way, the advertising surrounding the video will not be shown. Some videos on sites like YouTube now also have a lower band of advertising that pops up at the bottom of the video. The only way to get around these is to click the close box on the pop-up band. The other disadvantage of the free with advertising sites is that they collect data from every link and action a user takes. One way they do this is by putting small pieces of information, called cookies on a user's computer. To avoid this, a user can set browser preferences to either allow no cookies or to ask every time a site attempts to place a cookie on the user's computer. However, many of the sites require that users create accounts and that they must sign in to use the service. The sign-in process requires the use of cookies, so they must be enabled. That being said, users can still deny the other third party cookies that may be associated with the service or users can go into their computers and regularly remove cookies. The other issue with free with advertising sites is the possible compromise of personal information. On social networking sites, users often have detailed lists of their interests and friends. Sites like Facebook have compromised user data in the past, so it is highly recommended that users review the security preferences on their accounts on a regular basis. It should go without saying that as with other forms of free software, Free with Advertising products allow cash strapped schools and organizations to access resources without any up-front procurement costs.

What is the real cost of Free with Advertising?

As mentioned above the free with advertising model comes with the cost of constant bombardment of advertising pitches and the loss of control of personal data. In some respects the advertising is something most people are used to from newspapers, magazines, radio and television. In the past advertisers could know certain things about users based on their purchases or the media they subscribe to. What is different about the digital world, is the ability of the marketers to know specific details and their ability to predict what users might like or want. One example of this is a company like Amazon who have a sophisticated system that learns not only what one user likes but combines that with what other users have liked and purchased. Combining this information creates a smarter system. A site like Facebook that has adopted a system where users click a "like" button, now can be combined with other sites with similar "like" buttons, again increasingly learning about specific users and trends. Many of the sites now also have geotagging. A geotag is a small bit of information that associates location to images, videos or other media. Sites like foursquare combine social networking, marketing and check-in. Users can visit locations check into locations and get information, and friends are able to locate friends by their geolocation. Facebook will be introducing a geolocation feature. What that means is that not only will users post status updates but their actual location may also be known.

Along with a loss of control of personal data, there is also a potential loss to established businesses. Anderson (2009) describes the disruption caused by Free at the cost of one's salary. "Venture capitalists have a term for the use of FREE to shrink one industry while potentially opening up others: 'creating a zero billion dollar business' (p. 129). For example, in 1991 the encyclopedia market was approximately a $1.2 billion dollar industry. Encyclopedias sold for over $1,000 a set. In 1993 Microsoft launched Encarta for $99. By 1996 Britannica's sales had dropped in half and they layed off their field sales force. Wikipedia has now shrunk the market even further. In 2009 Microsoft killed Encarta (pp. 126-130).

Social media that is offered free of monetary cost is also addicting. According to research by Lightspeed Research for the Oxygen Media Insights Group, 39% of women 18-34 call themselves Facebook addicts. Many check Facebook before brushing their teeth or going to the bathroom, and 57% of adults report that they talk more online than face-to-face. While 63% claim to use Facebook for career networking, 42% think photos of themselves intoxicated on Facebook are OK and 48% claim to get more news from Facebook than traditional news outlets. (O'Malley, July 7, 2010)

Please see the page Evaluation Criteria and Template for Free Software to learn more about key points to consider when adopting any type of free software.

How can Free with Advertising be used in education?

Free with advertising sites and applications can be used in education where institutions allow access. As noted above when sites are blocked, teachers can try to locate the same information that may be hosted on safe sites. Sites like YouTube hold a wealth of valuable resources. When sites are blocked in schools, teachers can download the materials from YouTube and then play the resource from a drive, or open their own blog and embed videos in the blog. When teachers use a site with advertising as a resource for their personal use, they can let their conscience be their guide when it comes to advertisements and ad content. If, however, they are using these sites to refer students to, they will need to take into consideration, the age of the student, school guidelines, and ad content. Free with Advertising sites can be used for hosting of mulitmedia files by both teachers and students. This type of hosting puts control of the materials under the host and the user. When materials are hosted in an open environment collaboration, sharing and openness are encouraged.

Check these Examples of Free with Advertising