No Such Thing as a Free Online Lunch?

All my fellow Robert A. Heinlein fans out there will immediately recognize the acronym TANSTAAFL (pronounced "tans-taffle"), which stands for "There ain't no such thing as a free lunch." According to Wikipedia, the saying originally referred to the nineteenth century of saloons that advertised "free lunches" for their customers. The catch was that you had to buy a drink to get it. The meaning of the phrase as widely used in economics is that you can't get something for nothing. There's always a cost, hidden or otherwise.

But today we see many offers of "free" software and services on the Internet. Is the online world different, or do you (or someone else) end up paying for what you get, one way or another?

Remember the old "bait and switch" sales technique, whereby a store would advertise a product at an incredibly low price that sounded too good to be true, and then when you went in to take advantage of the great deal, a salesperson would deluge you with information about all the reasons that the advertised product was no good (or at least not good enough for you) and pressure you to buy a different, more expensive alternative? Almost all of us have been subjected to that experience at one time or another.

Now that the Internet has become a major venue of commerce, those who make a living selling products or services online have plenty of their own annoying techniques. One of my readers' favorites (or should I say "least favorites"?) seems to be the aggressive upselling of "premium" services and products by companies that offer freebies.

There's certainly nothing wrong with offering a basic version of a piece of software or an online service for those who don't want to pay, and a more full featured, paid version to which they can upgrade if they want those extras. The revenue from the paid version helps to support their ability to continue offering the unpaid version. The problem comes in when they won't let you enjoy your free program or service in peace, but instead nag you constantly to switch to the better, paid version.

Here's the difference: I've had a free hotmail email account for many years. Tom subscribes to their premium service, which for a small annual fee gives him more storage space. So I know this premium service exists, but I've never been pestered to upgrade my own account. I don't get email messages trying to persuade me to buy the premium service. In fact, in researching this article, I started trying to figure out how to upgrade my free account and couldn't find any obvious way to do it. If anything, they've been too subtle about it; the typical free account user would never know there was a paid option.

Then there's Classmates.com. I've had a free account there for years, too. But they are in no way subtle about their desire to have me upgrade to the paid service. There's not much you can do with the free account, other than see the names of people who have signed up as having attended your schools during the years you went there. You can't contact them, read their posts to your guestbook, or otherwise interact with anybody. Whenever you click on a link to contact someone, see names on the Classmates map, or see who's visited your profile, you get a message that you must upgrade to "Gold" status in order to do it. A Gold membership costs $15 for three months or $39 for a year.

That wouldn't be so annoying, except that at least a couple of times per week, I get email from Classmates.com notifying me that somebody has signed my guestbook. Of course, if I want to see who it is, I have to buy a membership. Now it's true that I went to a large school, but I seriously doubt that many people are signing my guestbook. And I refuse to be lured into paying for a membership just to find out whether or not it's true.

A common problem with Internet retailers is the failure to keep their web sites updated. This is usually probably more a result of laziness than an actual intent to deceive, but when a product is advertised at one price and then you're told, upon ordering, that the price has gone up, or when a product is advertised as being in stock and then you're notified that it's not and the company tries to sell you a more expensive substitute, it certainly feels like the old "bait and switch" routine is alive and well. Here's a recent example of that, reported by The Consumerist:
NWV Direct: NWV Direct Caught Pulling Bait And Switch, Tries To Backpedal

I sometimes get complaints from readers about software vendors who make their free programs a little more difficult to find. For instance, AVG has a free, very basic version of their antivirus software, but if you go to the logical place, you would never know it
AVG Antivirus and Security Software - Real-time protection against viruses, spyware and malicious websites

All you see there is the option to buy the paid version of their AV program. The free version has its own separate web site at
AVG Free - Download antivirus and antispyware software for Windows XP and Vista

It's not exactly deceptive, and a quick Google search will point you in the right direction, but I've heard from several people who ended up paying $34.99 because they couldn't find the free download on the main web site.

Another common complaint about free programs - when you do manage to find and install them - has to do with the "nag screen" that sometimes pops up when you're using free software, asking you to upgrade to a paid version. Other programs and web services simply insert ads into the graphic interface or web page. The idea is that someone else (the advertiser) bears the cost of your "free" software. The other side of that is that if the advertising is annoying enough, you'll pay to upgrade to a paid version that is ad-free.

A banner ad across the top of a web site, such as the ones that appear at the top of my Live Spaces blog site, really isn't all that annoying. Most of us can train ourselves to completely ignore those types of ads. What's more annoying are the pop-up or slide-in ads that temporarily obscure the site you're trying to access until you click to close them (and worse, some can't be closed until they've finished doing their thing so you have to sit through anywhere from a few seconds to half a minute before you can resuming reading the site you wanted to access. These types of ads are appearing in many online newspaper sites and they bug the heck out of me. What's particularly annoying is that with many of these papers, even if you subscribe to the print edition, you can't read the online edition without enduring these "in your face" ads.

Another trend on the national news sites is to make you watch a commercial before you can see a video clip on the site. CNN, FoxNews, MSNBC, etc. are bad about this. When I clicked on a video link in CNN's list of Latest News stories this morning, I had to both close a popup ad window for Netflix and watch an Equifax commercial before I could see the news video.

Okay, we all understand that businesses are in business to make money, and while advertising can be annoying, it's the cost of getting all that content without having to directly pay for it. What worries me is that we may soon be paying double. Remember the early days of cable TV? The premise was that you paid a small monthly fee for it ($15-20/month), but one of the main reasons you would be willing to pay for TV when you could watch over the air programming for no fee was ... freedom from advertising.

That's right, in the beginning, the vast majority of cable programs didn't have commercials. Well, those days are long gone. Now we pay anywhere from $40 to over $100 per month for cable service (it can get considerably higher with digital cable if you want TVs in several different rooms, since you have to rent additional set-top boxes), but the vast majority of the programs on the cable channels have commercials just like the old OTR programs. Even more annoying, since so many people now have TiVOs or Media Center PCs that let them fast forward through the regular commercials, we now have pop-up ads invading the bottom of the screen during our favorite programs. Grrr. Can I upgrade to a premium service that lets me pay more to do away with all the advertising?

Is that the way the Internet is headed? Ten years from now (or even sooner), will most online content be subscription based or "pay per view?" Things seem to be headed in that direction, albeit slowly. Some commentators believe the current economic crisis may speed up that process, as online content providers are forced to adopt new business models that bring in more reliable revenues:
No More Free Lunch Online. Good for Everyone | Profy | Internet news and commentary

Kids today don't remember ad-free cable, and most of them probably also don't know that once upon a time, there was little to no advertising on the Internet. Before the 'Net went commercial in the mid 1990s, we came as close as we'll probably ever be to having a (ad) free lunch. But as always, there was a hidden cost. Setting up an Internet connection back in those pre-Windows 95 days was not a task to be undertaken lightly. Configuring your Trumpet Winsock to connect to your ISP could be a daunting project. Getting email to work was a cause for celebration. And although we didn't have to pay for content or watch ads, we didn't have nearly as much content available and finding what was out there, sans Google, could be a real challenge.

Tell us what you think. Have all the online free lunches already been consumed? Or did they ever even exist? Was the Internet better before it became so commercialized, or are today's much greater content base, ease of use and rich online applications worth it? Would you prefer to get "free" content and services that are supported by advertising or ad-free content and services for which you have to pay? Which online advertising techniques annoy you the most? Let us know your opinions.