When you say it like that, a light really went on for me. In an undergrad economics class (for some reason I can still remember the exact phrasing the professor used, though it's been almost 30 years): "a good is 'free' if, at a price of zero, supply is adequate to meet demand."
This completely explains the unique situation with regards to digital information. The (marginal) cost to provide a supply adequate to meet demand is zero.... meaning the market will drive the price to zero... digital information is free. As a content publisher, you can want it to not be that way, but that is not the reality.
But that definition isn't true of most digital content. Commercial music, movies and software are effectively subject to price discrimination: pirates pay zero, but legal customers pay nonzero and subsidize the pirates. If the price dropped to zero for everyone then supply would plummet as well.
> If the price dropped to zero for everyone then supply would plummet as well.
That's a myth, because people were writing novels and singing songs and doing theatrical plays long before media distribution and consumption. Even now many musicians earn much more money from live concerts.
Also, I pirate stuff, mostly because where I live I can't get that content at all when I want it. However I also go to the movie theaters nearby with my wife and pay something like $30 for 2 tickets and some popcorn, per movie.
I don't mind paying that price because I'll never have the same experience at home, no matter how awesome my equipment can get, because (1) the size of my monitor is upper-bounded by the size of my living-room walls and (2) watching movies at home is boring.
I don't think you have the evidence to back up that assertion. Certainly the world is changing, but people simply like making and sharing stuff. How much money have you paid for the entertainment you get from Hacker News?
Marginal cost = price only in perfectly competitive markets. For commodity content(e.g., daily news), then yes the expected long term price is zero. For content that does not have (perfect) substitutes (e.g., the latest Batman movie), the expected market price is not zero.
When you say it like that, a light really went on for me. In an undergrad economics class (for some reason I can still remember the exact phrasing the professor used, though it's been almost 30 years): "a good is 'free' if, at a price of zero, supply is adequate to meet demand."
This completely explains the unique situation with regards to digital information. The (marginal) cost to provide a supply adequate to meet demand is zero.... meaning the market will drive the price to zero... digital information is free. As a content publisher, you can want it to not be that way, but that is not the reality.