I was thinking about the issue of the web 2.0 price point since folks have been working towards making things closer to free per this ZDNet article. My thought on the world of the free is that is somewhat how software started. Things were "free" but that really meant that the software was integrated with a bunch of services to keep the hardware running. The model started to break down when folks like Microsoft, Lotus, and SAP figured out that software could be made well if it wasn't free. What I noticed in the mid-late '90s was that the Microsoft software was doing much better than the free world of Unix that was tied into vendor operating systems and had lots of strings attached that caused the non-commercial software to get fragmented into tons of versions. I would expect that Open Source will continue to have this problem but that isn't exactly what Web 2.0 is supposed to mean completely.

The iswithwith free stuff is that it tends to get worse over time against stuff that costs money. So eventually if you value the item you want it to be not so free. The one exception is when things are free because they come attached with something someone else wants. In the case of most internet services that are free the attached thing is advertising. The search engine game isn't new. We've been getting advertising with the phone book, and media outlets like magazines, newspapers, radio, and television forever. So the free stuff that is advertising funded ought to stick around for quite a while. But the entire web 2.0 world isn't advertising oriented... or is it?