Free: The Future of a Radical Price. Chris Anderson. Hyperion. 288 pages.

Wired magazine editor Chris Anderson, author of this book, is in a bit of trouble these days. He's been accused of plagiarism for not attributing chunks of text to Wikipedia, the collaborative online encyclopedia, among other things. More about that later, but it's unfortunate, as the parts of this book unambiguously originating from Anderson's brain are excellent.

Its basis is that the no-charge phenomenon is more than just a Trojan Horse for selling stuff, as in the giving-away-the-razor-and-selling-the-blades business model. Instead, it's a force that disrupts the existing market, diminishes or destroys incumbent businesses and creates new opportunities for providers and customers.

For example, Encyclopedia Britannica was the dominant player in its category until Microsoft's introduction of the CD-ROM-based Encarta, which decimated Britannica and its door-to-door sales force. Google offers an array of free services (search, e-mail, blogs and a variety of applications) and has earned a fortune selling complementary advertising based on users' affinities and other data uncovered by tracking their behavior on the Web.

Anderson goes into some detail as he examines how industries that were confronted by ``free'' competitors responded to the new challenges. Yahoo's e-mail service had long been the dominant one, so when the company learned about Google's imminent introduction of Gmail, they did everything they could to anticipate and match their competitor's offering, mostly by dramatically increasing the storage capacity, correctly assuming it to be a key competitive advantage for the upstart. The result, Anderson reports, is that Yahoo maintained its position as top e-mail provider, important for a website that positions itself as a key portal to the rest of the Internet.

It's also not a matter of displacing one business and seizing its customers -- and revenue. A few years back, a now-retired newspaper executive was roundly mocked for his response to a question about what he worried about most. ``Electronic classified advertising'' was his prescient response. But after Craigslist largely captured that highly profitable form of newspaper advertising, it hasn't, as Anderson writes, gained the newspapers' lost revenue. Instead, the money is just kept by the former classified advertisers.

Anderson also gets into the psychology of free (and other price points) and how wise marketers are using it to develop relationships with customers, like the musician who offered a download of his new album gratis in exchange for fans' ZIP codes, which provided him with the means to promote his concerts.

All in all, Free is an interesting book and a provocative discussion -- which is why the controversy surrounding the author's use of outside material is baffling. Good editors insist upon using media other than Wikipedia, since it's far from reliable as a primary source. You can find more about this issue, as well as the author's somewhat tame defense online, if you're are interested, but inexplicable sloppiness notwithstanding, Free is a fascinating survey of the shifting commercial landscape.

Though the book is for sale, by the way, at the usual online outlets and at brick-and-mortar retail locations, it's also freely available to read online at Scribd.com (www.scribd.com/doc/17135767/FREE-full-book-by-Chris-Anderson-Read-in-Fullscreen), and as a free audio download on iTunes.

Feel free!

To receive business book reviews by e-mail, e-mail Richard Pachter at rap@richardpachter.com. To read more of Pachter's musings, go to www.richardpachter.com and follow him on Twitter @rpachter.

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