The Free Market for Snake Oil and the Age of Unreason

It's been interesting watching the reaction to Malcolm Gladwell attacking Chris Anderson's book "Free" - including Mr Anderson's riposte here (though technically the book should be called "Freemium", as he's largely abandoned his Free hypotheses of this time last year).

Its interesting in that Gladwell is the first Superstar grade guru who has had a go at Anderson and thus gets widely reported - he's not saying anything new mind you, its just that the mainstream media doesn't pick up economists, bloggers or even journalists who know a bit about economics - people telling us we can't have it all for free, now, are soo dull, dahling.

Which brings me on to the big problem I see here. Lets be clear, Anderson is proposing the economic version of a perpetual motion machine, but thats not the point of this post - quacks, charlatans, snake oil salesmen and journalist-authors on the make have been with us a long, long time. ( I'll get to what's wrong his theory tomorrow, but in essence its impossible to have the All Free to All Men, All the Time case )

The interesting point is that it is far, far harder to rebut these sort of claims in the new media, especially if the claimants have access to a good channels of their own.

There was a rather fascinating article last week in the FT talking about the trend in New Media towards "Small example set Narrative" replacing "large sample set Fact Base" as the way of conducting and winning arguments. Talking about a lecture (Ironically by Malcolm Gladwell, but it is the same general picture):

But this wasn’t a book reading or a Q&A session of the kind authors traditionally submit to. Neither was it a slide show, as you might expect to find at a lecture. Instead, the author recounted a single vignette from the book – the tale of why a plane ended up crashing, from the perspective of the pilots and those in the control tower – and burnished it into a narrative with all the chill and pace of a traditional ghost story. Even the lighting was kept deliberately low to create the right atmosphere.

As the FT piece notes, this is a new trend:

I have seen a shift away from the traditional model of book readings and for-and-against Oxford Union-style debates and towards a showier kind of speaking event, in which bookish ideas and themes are lifted off the page and into the stuff of rhetoric and performance.

The reason?:

...in popular non-fiction genres such as business and technology, the economics of books are beginning to follow the economics of the music industry. We are familiar with the sad tales of record companies headed for disaster thanks to people accessing music free from the darker corners of the internet rather than paying for it. As a result, pop stars from Coldplay to Prince have embraced a new kind of business model, which relies on giving music away cheaply or free then looking to make more money out of live performances.

The talking tours of high-profile writers follow a similar logic. While book sales are not suffering at the hands of online piracy in the same way as music and films, they are falling.

I would argue that the ergonomics of online media vs paper is forcing a similar shift. It is far harder to read long essays with complex arguments online, so shorter "sketches" are better. And if they dispense with the "hard" and go for the "fun" then they capture that all important prize, Attention, far better.

Social Media exacerbates this - if a well known player and/or blog trumpets something, it resonates widely. As these blogs have no compunction at all to carry alternate viewpoints, the dissenting voices - if they are smaller players on the social network - hardly get heard at all. If, in addition, the "popular" players broadcasts "populist" stuff and the rebuttal is complex and dull, it has even less chance. Besides, you can always drown oit dissenters unless they are in huge quantities with your own astroturf crew.

For example, let's say the icon of your choice spouts pure (but entertaining) cr*p to their 50,000 followers (who then re-tweet like good little acolytes), and a few experts in the field with a few thousand followers each rebut it, the correct version will be buried in the deluge. Ignorance prevails.

And it gets worse - typically, those espousing the populist cr*p can get funding from commercial entities, those resisting struggle for resources, so the field is further unbalanced. I have watched the "Free" hypothesis trumpeted in media organ after media organ , typically via journalists whose grasp of economics (or even maths) is tenuous at best. Tonight, for example, I am going to listen to Mr Anderson talk at the Royal Society of Arts - not the London School of Economics

And as this episode proves, even if you can get a fairly well known person to rebut the claims in a fairly well known piece of media, the claimant instantly pops up again on their own channels. And, if you happen to own a nice big megaphone like Mr Anderson (who edits Wired) does, then whatever rebuttal does emerge can rapidly be countered and covered in snake oil.

The lesson for the future is obvious. The truth may out, but if its not populist it will need a frigging great megaphone to have a hope of being heard.

Right now, as far as I can see, in the New Media Age there is a big risk that the Age of Reason is slowly sinking, and we are entering the Age of Unreason, as the (largely unfunded) forces of Right drown in a sea of (largely commercially funded) snake oil.

(I forgot to mention - both Wired and teh New Yorker where Gladwell wrote are Conde Nast journals, and both Gladwell and Anderson have new books out. Perish the thought that this is all about making, um, Money )

Update - it would seem that Mr Godin has also popped up in defence. Now I think Mr Godin is a great marketeer, but he is a lousy mathematician. When he says "Free is a relatively cheap way to get attention (both at the start and then through viral techniques)" he is repeating the erroneous Free assumption that if you charge nothing the costs somehow go away too, which is what Gladwell was pointing out. A small cost multiplied many times is still a big number that someone has to pay.