When we think of the Great Depression, we imagine long lines of gaunt men, caps in hand, waiting for soup handouts. The equivalent photos of today's economic hard times -- displayed for free, of course, on Flickr -- may be represented by images of unemployed people in front of their computers cheerfully donating their labor to Wikipedia.
Unfortunately, there is no doubt that a lot of Americans are suddenly going to have a lot of extra time on their hands to donate their labor for free. Unemployment in America is already at a five-year high of 6.1 percent, with leading economists like 2008's Nobel Prize winner Paul Krugman predicting that it will be "certain" to rise to 7 percent and "quite possibly" to 8 percent as the depressing economic implications of the Wall Street financial meltdown crawl up Main Street. As Krugman wrote, with unvarnished Hobbesian honesty, in The New York Times earlier this month, "All signs point to an economic slump that will be nasty, brutish -- and long."
So much for the good news. Hundreds of thousands, and perhaps millions, of newly redundant Americans will have nothing to do all day except contribute to wikis or become citizen journalists or "work" on their Facebook or MySpace pages. In an America where one in 10 adults are out of work, will Wired editor-in-chief Chris Anderson's free economic model revolutionize the nature of work? Is $0.00 really the future of labor in an age of mass unemployment?
Of course not. One of the very few positive consequences of the current financial miasma will be a sharp cultural shift in our attitude toward the economic value of our labor. Mass unemployment and a deep economic recession comprise the most effective antidote to the utopian ideals of open-source radicals. The altruistic ideal of giving away one's labor for free appeared credible in the fat summer of the Web 2.0 boom when social-media startups hung from trees, Facebook was valued at $15 billion, and VCs queued up to fund revenue-less "businesses" like Twitter. But as we contemplate the world post-bailout, when economic reality once again bites, only Silicon Valley’s wealthiest technologists can even consider the luxury of donating their labor to the latest fashionable, online, open-source project.
In his best-selling book, Predictably Irrational, MIT behavorial economist Dan Ariely suggests that most of us are irrational when it comes to determining the value of our labor. I’m not sure. I may not have Ariely’s grasp of behavorial economics, but I’m pretty sure, if not certain, that the idea of free labor will suddenly become profoundly unpalatable to someone faced with their house being repossessed or their kids going hungry. Being paid to work is intuitive to the human condition; it represents our most elemental sense of justice.
So how will today's brutal economic climate change the Web 2.0
"free" economy? It will result in the rise of online media businesses that reward their contributors with cash; it will mean the success of Knol over Wikipedia, Mahalo over Google (Nasdaq: GOOG), TheAtlantic.com over the HuffingtonPost.com, iTunes over MySpace, Hulu LLC over YouTube Inc. , Playboy.com over Voyeurweb.com, TechCrunch over the blogosphere, CNN’s professional journalism over CNN’s iReporter citizen-journalism... The hungry and cold unemployed masses aren’t going to continue giving away their intellectual labor on the Internet in the speculative hope that they might get some "back end" revenue. "Free" doesn’t fill anyone’s belly; it doesn’t warm anyone up.
When, in 50 years time, the definitive histories of the Web 2.0 epoch are written, historians will look back at the open-source mania between 2000 and 2008 with a mixture of incredulity and amusement. How could tens of thousands of people have donated their knowledge to Wikipedia or the blogosphere for free? What was it about the Internet that made so many of us irrational about our economic value? It was a "mania," these mid-21st-century historians will explain, like the Dutch Tulip mania of the 1630s or South Sea Bubble of 1720 -- a mania that ended with the great crash of October 2008.
— Andrew Keen, Silicon Valley author, broadcaster, and entrepreneur