The Advantages of Freeconomics

Recently I've been thinking why Web2.0 startups are teaching Internet users not to pay for anything. Isn't it devastating for the industry? I know, the industry is doing very well, but in the long run we create an environment where everybody will have to make a living form advertisements. Wouldn't it be more honest to say that Twitter works hard for you and they deserve a penny per month for their efforts? Reading the valuation story of 37singnals (www.37signals.com) made me realize that it is indeed a brilliant strategy to make things for free and let the market speculate. Click here to read the story:  http://bit.ly/TghNO

Another interesting point Prof. Aanandamayee Bhatnagar makes is the equation for valuations, I like that a lot, too:

[(Twitter followers x Facebook fans) + (# of employees x 1000)] x (RSS subscribers + daily page views) + (monthly burn rate x Google’s stock price)

(I'm using the #T4E tag that's popular on Twitter, meaning Tips for Entrepreneurs.)