There are some who say you should give away "all" your ebooks for free to make money on the backend from your scarce goods, but I disagree. Giving everything you write away for free in digital monetarily devalues your work and makes it appear that the only true monetary value is in the production costs.
I keep saying "monetary value" instead of just "value" because too many people want to shift the argument to "intrinsic value" you know like sunshine and puppies and love. But in business we’re rarely discussing love and sunshine when we talk about value.
When you give all digital versions of your work away for free you are training customers to NOT pay you, which is not a good idea. People will take advantage of you to the degree that you allow them to take advantage of you. Some people will "still" try to take advantage of you, but that’s a reality of life. You don’t have to invite it by giving "everything" away.
If you walk down the street and come across someone who looks shady, do you pull out your wallet and hand it to him to avoid the "possibility" that he might mug you? No? Then why should you give all digital away to avoid piracy?
Many advocates of the freemium model state that piracy helps both consumers (to get what they want out of companies, which is kind of like saying hostage situations help criminals to get what they want, or guns make rape easier) and the companies/artists themselves by boosting their exposure and increasing the sale of scarce goods. On the surface this sounds okay. But the problem with this is… when you start shouting from the rooftops how great piracy is for everybody then it trains consumers to see piracy as "okay" and to not buy things, just steal them.
While some sales from piracy are due to someone wanting a "scarce good" related to it, I would guess that a lot of it is just from more people hearing about it and the honest people buying it. I know I know, there are those studies that the people who buy the most music also pirate the most music, so? Does that make it okay? I don’t think it does.
Whether or not it helps or hurts everybody isn’t the issue of whether it’s right or wrong, but appealing to consumer morality is about as effective as a woman walking naked through a men’s prison saying "rape is wrong." Either a consumer is honest or they are not. If they are, they don’t need a sermon from you. If they aren’t, your sermon will fall on deaf ears.
Also, piracy does not necessarily help everybody in every situation. There are situations and circumstances in which it hurts you, like when Nicole Peeler talked about how it could hurt her ability to get a new contract. Will piracy drive her print sales… maybe, maybe not. Will it hurt them? maybe… maybe not.
Not every pirated copy is a "lost sale" since chances are good the pirate wouldn’t have paid for it anyway. However, when we train a whole generation of consumers to expect everything for free, to not value the time and effort that goes into these types of products, to think "piracy helps" so they can steal and somehow "help the artist," then we’re basically taking someone who otherwise WOULD have paid for something, and giving them permission to sin so they don’t have to feel guilty about it.
Most people have at one point or another participated in file sharing. But at the very least, you should feel guilty about it. You should know it’s wrong, you’re wrong, it’s not okay, and you should have waited until you could pay for it.
The issues of piracy and voluntary free content are not the same thing. Piracy is an unfortunate reality of life. However, when you show you don’t consider your writing of monetary value by giving it all away, you’re just hurting yourself.
Also, if/when E becomes the primary delivery method and print is just a subsidiary right, people will need to charge for E to make money. If you’ve been giving it all away, you can’t really switch gears like that without pissing off your consumer.
I think limited amounts of free is okay, even beneficial. My free plan is: KEPT (full novella, first story in the Preternaturals Series), Free excerpts of all future books, and Free podcasts (because audio is such a different experience.) That’s it with the exception of "limited" freebies. Like "two weeks only, get this book free here" sorts of deals. A reader who expects even more free than this, is never going to pay for your work; they’re just going to mooch off you forever. (Unless they are poverty stricken and can’t afford to pay for any entertainment, in which case they might buy your work later if their situation improves, but why would they if they don’t have to?)
Check out my Podcast about this very issue: "Freemium" NOT "Free Extremium"