This is kind of a continuation of my discussion about the Net Neutrality issue. It started me thinking about how important the Internet is for people and one of the things that I thought about is the free market aspect of the Internet. It is a place where anyone can set up shop at a minimal cost. Instead of needing a physical storefront you have a digital storefront and can connect to people as far away as you want to, most likely just the country you are in, but the possibility is there. Now you still have to compete with the larger businesses, but the ability to do searches online means that people might find your business by looking for something more specific. Then there are stores such as Etsy that allow people to set up a mini shop using their infrastructure. You have a place where people know to go and can find things that you make. The Internet builds a great free market. You can view ratings of products, businesses, and there are websites specifically dedicated to letting you know about how businesses are in your area.
Free Market Ideals
The Internet was built as the ultimate free exchange of information, which leads quite naturally to an open exchange of good. The entry fee to get your business on the Internet is not too high. Now there are other issues that you have to worry about, but in general we have built a space where you no longer need the physical store front. So many businesses have been established around the fact that they are not a brick and mortar store, but completely online. Amazon is the greatest example of an online only business model and now look where they are. There are so many stores now that have online only stores and you can find a plethora of items based on a variety of wants and needs. Now it is easy for the various hobbyists to find the things they need for their hobby. Yarn, model planes, figurines, clothing, toys, office supplies, etc. Eventually you can get a saturation of certain businesses online, but you are not limited by space the same way you are with physical stores.
Larger Word of Mouth
The other part of the Internet that really helps is the ability to rate almost everything. Now instead of asking your neighbor how something is you can go see what anyone who has ever been there, and chosen to rate the place, thinks. It gives an easy ability to find the better businesses to use. One of my favorite uses of this is things such as Urbanspoon or Yelp. The number of amazing restaurants that we have found using these services is amazing. I love it because it helps to find more independent and local restaurants instead of relying on chains. This can be the same for stores as well. Hearing that someone else bought something from Think Geek might make you want to buy something too. The access to information about business makes this incredibly important for the free market. To really have a free market you need to have the information available to make appropriate decisions. Otherwise we will probably default to what you know.
Capitalism at Work
The Internet really is a good example of how Capitalism can really work. It is no longer people just yelling in a town square now you can post information that is available as long as the website is still running. A true free market demands a free exchange of ideas and knowledge, which is what is great about the Internet. If this exchange becomes compromised then the free market that the Internet has been built upon would not function the way it has been. This just really worries me because if we let the ISPs decide whose business is more important based on who can pay them then who knows what type of business model the Internet will turn into.