“Freedom’s just another word for nothing left to lose
Nothing, I mean nothing honey if it ain’t free…”
- Janis Joplin, Me and Bobby McGee

The central premise of “Long Tail” Chris Anderson’s excellent new Wired article is that the incremental cost of providing “goodies” on the web (i.e., web services of all stripes and colors) is near-zero and falling. Hence, it should come as no surprize that gmail now offers unlimited storage and Jott freely transcribes your voice into email form and sends it.

The article serves as a free trailer of sorts (get it?) for Anderson’s upcoming new book, aptly titled Free. Along the way to his dissection of modern internet business models, he takes us on a fascinating historical journey through the “land of the free,” starting with King Gillette’s “free blades” and moving through 19th-century San Francisco’s “free lunch.” There’s much to like here.

But what does this all mean to Untangle and its business? Let’s take a look….

At the heart of Anderson’s business analysis are two things: a six-part taxonomy of “free” business models and some insightful views on “what isn’t free.” Let’s look at the former first.

The six primary forms of leveraging free goods and services, with examples, are:

* FREEMIUM – “File backup is free, but backing up email will cost you.”
* ADVERTISING – “You can search, but you must view these (small) ads.”
* CROSS SUBSIDIES – “Razors are free, but you buy the blades.”
* EXPLOIT ZERO MARGINAL COST – “Of course you can copy (and distribute) our free software.”
* OBTAIN A LABOR EXCHANGE – “If you grade one song, I’ll show you the group opinions for two.”
* GIFTS – “You can use this site for auctions – I just think it’s the right thing to do.”

I’m sure that you can recognize Google, Craig’s List, Ubuntu Linux, and others as users of the models in this list. But did you recognize Untangle?

Here’s how I believe we fit in:

* FREEMIUM – “Security is free, but a business web portal is not.”
* ADVERTISING – Nope.
* CROSS SUBSIDIES – “Security software is free, but you you might want a new server.”
* EXPLOIT ZERO MARGINAL COST – “Of course free users can get security signature updates.”
* OBTAIN A LABOR EXCHANGE – Coming: “If you get free updates, please help us keep the list current.”
* GIFTS – “We’ll sponsor Open Source Intallfest; it’s just the right thing to do.”

So the Untangle business model has “freemium” at its core, but also uses other elements of free models.

Getting back to Chris Anderson and his article, he cannily ends his mini-treatise by observing that two things are actually increasing in value in the web world – “attention” and “reputation.” Right on.

But I would offer that these two attributes are modern renditions of that ages-old grail – brand – especially as postulated by Ries and Trout in their groundbreaking 22 Immutable Laws of Marketing. For example, the 3rd LAW states that it’s better to be first in the mind than first in the market. And nothing so captivates the mind than the powerhouse concept of “free.

“Here’s a final exercise for the reader. The chart below shows the market adoption of Untangle. This is real data from our CRM system. Can you point point to the spot where we decided to make our core security free?