Are free Internet services sustainable?

Free e-mail, free games and free access to many online services, when describing the Internet age it is hard to ignore its "for free" aspect.

This strategy is being applied in the ongoing wave of smart cities in the country as well. Since the Ministry of Housing and Urban-Rural Development published lists of 193 sample smart cities in 2013, one city after another has published its plans for being smart. For example, guided by its plan to propel the construction of a smart city, Shanghai is currently making more efforts to combine information technology with industrialization and apply big data to promote greater convenience for residents. And other cities are trying to accelerate the smart process by offering online services for free. As one of the groundlaying infrastructures of a smart city, Wi-Fi coverage is often on the "for free" list.

But an analysis of the origins of "for free" is needed to decide whether it is proper to build smart cities providing free online services. Digital products have a special cost structure: most of the resources are invested in producing the first copy and hardly any more are incurred in reproducing them; further, the Internet makes it easy to distribute them. For example, it might take a long time and considerable labor to compose a new song, but little time and energy to copy it and offer online download sources.