The web enables us to listen to music, watch tv shows and follow the latest news all without paying a cent. But while things are slowly but surely becoming free, I still believe people are willing to pay for certain value propositions.

Image courtesy of laffy4k

I believe the following 5 things are uniquely profitable in a world of free:

1. Convenience

People are inherently lazy. If you make their lives easier, they will pay you for it.

There are several ways to listen or download music for free, yet people are still paying for songs via iTunes or amazon.com. Why? Because of how easy it is to find and download music on those sites. People value their time more than the 99 cents per download. If you make things convenient and easy people will pay.

2. Quality

Price ensures a more serious and interested clientele. There are many online forums that are free (i.e. Sitepoint, DPreview), but there are also a handful you need to pay for to access (i.e. Webmasterworld, SomethingAwful, metafilter). I believe the reason people are willing to pay for those online communities is because the quality of the content is better. There is a higher signal to noise ratio. This same premise applies to dating sites. People will pay for membership to online dating sites, as opposed to finding dates through any number of free social networks.

3. Additional Functionality

Many websites give consumers just enough services to whet their pallets, and then charge for more functionality or more services, also called the "freemium model." Notable examples include the 37 Signals‘ product offering, Flickr’s Pro Account, and Skype.

4. Customization

Wordpress.com is a great example of this. They provide anyone the ability to have their own personal blog for free however they charge for the ability to customize the CSS or a the blogs domain name for additional fees. Smugmug is another example.

5. Privacy

People still value keeping their private information private. To protect their identity people are willing to pay GoDaddy an extra fee when registering a domain name to ensure the address remains undisclosed.

What do you value enough that you are willing to open your wallet for?

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Note 1: I would like to delve into this further and have proposed a talk for next year’s SXSW conference on this topic. If this discussion is of interest to you, I welcome any feedback and would appreciate your vote.

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Kevin Kelly, Wired Magazine’s cofounder, has a really great list of attributes he asserts are "better than free." These qualities people will pay for in a digital age and include:

1. Immediacy
2. Personalization
3. Interpretation
4. Authenticity
5. Accessibility
6. Embodiment
7. Patronage
8. Findability

I asked my twitter followers and received some interesting suggestions:

* accessibility
* silence
* beauty
* freedom
* peace of mind
* respect
* attention

Any other ideas?

This column was provided by Michael Galpert, co-founder of NY-based Aviary. Aviary is a suite of rich internet applications geared for artists of all genres.

Images can be saved locally or into a Sumopaint account. I did notice that the local save function didn’t work in IE. There are a variety of community features including voting and a comprehensive photo search for photos stored on Sumpaint.

Kevin Tofel was impressed with Sumopaint when he reviewed it on their initial launch this past summer. Brad Linder wondered if it was a dupe of another online photo tool, Splashup. I could see my sister using Sumopaint for her basic graphic creation needs.

I assume once they exit beta, some sort of premium services will make up their business model.

Mashable notes, "new features include Peacock, a special effects creator, and Toucan, a color manager that lets you create and find swatches that you can store online and use in the editor. One of the biggest new additions to the newly launched Aviary service is a vector editor similar to Adobe Illustrator, which will only be available to subscribers."

Aviary has also released their pricing model which ranges from a limited version for free through a full version for $150/yr. If you use this special link, you can grab a $55 discount on a yearly membership.

We’ve written about Aviary before including Aviary co-founder Michael Galpert’s guest post on "What do you pay for?" where he looks at free vs. paid services.

Today Aviary is out with a browser-based terrain generation tool which looks quite sweet. Check out their blog post about the product launch. If you have the Aviary app loaded, you can click on the images in the blog post to directly edit them.

While it looks like the functionality just creates moon-like worlds, it can actually work to create some very groovy effects. I’ve embedded one of those effects below – the 3d space invaders game. Space Invaders was one of the most boring video games ever – if there was a multi-shot it would have been better. :)

Now if they could just get an easier to remember domain name (a.viary.com)…

We were the first to report on Aviary last month and also posted their demo video from the NY Tech Meetup. Aviary was the first startup in months to get actual applause after their demo concluded. It’s a hot product and is created right here in NYC.

Today (actually tomorrow as the news is dated 4/1) Aviary will launch the next application in their suite. This one is very cool and very useful. Want to know what a potential spouse might look like in 40 years when you are on Social Security? What about Taurus or Fondue – will they age as gracefull as their owner? Well, Aviary has a new tool called DoDo to help you "do" that. Check out the Aviary blog for all of the details.

The best part is the "Dodo’s built-in database of geographically accurate weather history." If you tell your boss you were working but really in Switzerland skiing, you can just fake up a picture. I love the ability for the system to turn young Michael into current Michael and then grampa Michael.

If Facebook is worth $15 billion, this type of app makes Aviary worth at least $30 billion, I hope they go IPO QUICK!

I sure hope this product will be available to the public soon. I am leaving CN headquarters right now with a bag of photos and am heading to the Aviary offices to see what we can do. I will also get login keys for all of you as well. Leave your name in the comments if you’d like a login to DoDo.

In the meantime, watch this demo of the app:

Part of what will lead to the success is the distribution deals each one has already signed. As Marc Andreessen has said many times, distribution is the key. I am interested in your opinions on the companies listed below – leave your thoughts in the comments.

GoMobo

We took a look at GoMobo last month and also posted their demo video from the NY Tech Meetup. The basic idea with GoMobo is that you can order food from a fast-food joint or restaurant using your mobile for takeway. What this does is save you the time from standing in line. And we predicted 2008 would be the year of the time-saver apps.

Currently the service area is mainly NYC but they have expansion plans in 2008. Their distribution comes from the chains as a point of differentiation which includes Dunkin Donuts, Subway, Papa Johns, etc. Imagine punching into your phone that you want a large Milky Way hot chocolate, corn muffin and a bag of munchkins and having it ready when you arrive.

Think about the time saved from waiting on a line at lunchtime – especially for a person on an hour lunch break. GoMobo estimates the time saved by using their app is over 284 days, I don’t know how they calculated it but even if it’s just 5 minutes each trip, it can add up quickly.

And more importantly, outside of Manhattan, think about the possibilities using mobile in your car – no waiting on a drivethru lane, you just drive directly up to the pickup window at the moment you desire.

The service is free for consumers and GoMobo generates a percentage of the order price. The food establishment doesn’t care because a good percentage of this business will be incremental sales.

Aviary

Aviary is the newest of the apps that we believe will change 2008. The demo of their first app is just amazing. Aviary is a suite of tools targeting the artist community. It’s an actual competitor to Photoshop and Illustrator online. Of the 80-100 demos at the NY Tech Meetup I’ve seen in the last year, this was the first one to receive massive noise and excitement after the demo.

Sure, there are other products like Skitch which are great but appeal to more of the basic graphic needs. I haven’t seen any other product that takes the perspective of what an artist needs and moves it online. The distribution angle for Aviary is to their core group of potential users, the artists. They have tied into their core business, worth1000 to grow excitement and buzz.

The unique angle and game changer for Aviary is in how it deals with copyright and royalties. Since the application is built for artists who make a living at selling their works, it makes sense that the copyright and royalty piece be part of the application. Each piece of the final work is tagged from the source files. Maybe this will help issues like the one that blew up last year with Richter Scales usage of photos. I wouldn’t be surprised if Aviary starts receiving acquisition offers soon.

Flixwagon

Yesterday I met with Flixwagon VP Marketing Sarig Reichert and VP R&D Roy Ginat. Flixwagon is based in Israel and their goal is to make video sharing less cumbersome. If we look at the videos from the NY Tech Meetup, I shoot them, download them, compress them in Windows Movie Maker, upload them and then finally embed them into a post. Flixwagon changes that by shooting live video on your mobile device and having it appear on your blog immediately in real-time. Sarig says that they are empowering a revolution.

You get the full impact of the possibilities when Roy walked outside the coffee shop into Rockfeller Center and began shooting live video while Sarig and I watched it on the laptop. Imagine the parent who was away on business while the child was playing in a soccer championship. The parent could watch the game live from another location. The possibilities are endless.

Their distribution will come from partnerships with major brands. They hosted MTV’s Choose Or Lose special for the Super Tuesday primaries this week in which 51 live streamers were in every state in the nation sending back live video to the MTV Web site and on the TRL tv show.

Soon you will be able to ping Twitter when you are broadcasting and they are working on scheduling and an upload function to YouTube once the live version has completed.

Another company in this space is Qik. Qik has been getting major buzz recently thanks to webulebrity Robert Scoble and his use of the application. I can’t speak to the differences as my phone currently does not handle mobile video, but Sarig says both companies are creating a market and he likes what they are doing. Saris is proud of their video capture quality and the system is built to handle massive traffic.

Once video on mobile devices becomes a standard, Flixwagon is set for success. Photos are so 2005. This is where Yahoo Live should be.

TheIssue

TheIssue is a blog newspaper and they want to find “the best content”. Someone asked why a machine couldn’t do it better, I’d ask the same thing. In fact, TechMeme, while not perfect, does a good job of story aggregation.

Aviary

Check out our full Aviary review from yesterday. Corel needs to acquire Aviary immediately.

Xerpi

Check out our full review of Xerpi. It’s a tool to help you manage your favorites.

Plink

Plink lets you tag your photos in Facebook with either information about the people in the photos or the products in the photos. If the tag is for a product, you can link directly to the product for someone to purchase. As many asked in the crowd, without some sort of revshare model, there’s no reason to spend the time plinking something. I’d actually suggest that even with a revshare, meeting the payout will be difficult so there is very little incentive to link to a product. If it was to work, it could be a strong offering, but it will take a massive effort to make that happen.

Takes All Types

Takes All Types is a Facebook application to list your blood type and location. Should there be a blood shortage for your type and location, the system will send you an alert. It’s a pretty interesting idea and the company has non-profit status. This is one of those apps that hits you in the heart for an install.

TechPresident

This one got ugly quick as presenter Andrew Rasiej discussed how Obama is using the internet while Clinton isn’t. People in the audience seemed to believe that Andrew was pushing Obama over Clinton. The TechPresident site has information on how each candidate is using the Internet, from Facebook friends to Technorati links.

Aviary describes itself as, "a website for artists of all genres to create, edit and share their works directly in their favorite browser." There are about 15 total image tools, all with bird names like Owl and Phoenix. The tools are all available online inside the browser along with downloadable versions using Adobe Air, similar to Pownce.

What makes Aviary even more innovative is the way they protect and have thought about how artists work. Aviary tracks all rights, royalties and attributions in a work forever, and across collaborations. Aviary’s applications communicate with each other, allowing for seamless editing in multiple tools for a single project, as well as shared resources between tools.

Pricing hasn’t been revealed yet but during the beta all access is free. The one thing that worries me with Aviary is their domain name – it’s not aviary.com but rather a.viary.com — if popularity grows, will people be able to find the app? 

Aviary has given us 100 beta invites to give away to our great readers. If you’d like one, go here. We will have the demo video from their presentation tonight.

Here is an example of what Aviary can do using our favorite poptart, Britney Spears. Damn.