Kathy Sierra has a very funny, but insightful post regarding the Wisdom of Crowds, or more specifically, the bastardization of the term.

And the most frustrating part for me is how the “Wisdom of Crowds” idea has been twisted and abused to mean virtually the opposite of what New Yorker columnist James Surowiecki says in the book of the same name. He opened a talk at ETech telling us that while ants become smarter as the number of collaborators increases, humans become dumber. In what is potentially the most misleading book/idea title in the history of the world, the “Crowds” in “The Wisdom of Crowds” was never meant to mean “mobs”, “groups acting as one”, “committees”, “consensus” or even “high collaboration”.

By “crowd,”, I think he meant “more people”, sure, but he also defined a big ol’ set of constraints for how much togetherness people can have before the results became dumber. And it turns out, not that much. By “crowd”, he was referring to a collection of individuals. Individuals whose independent knowledge (and “independent” is a key word in what makes the crowd “smart”) is aggregated in some way, not smushed into one amorphous Consensus Result.

Creating Passionate Users: The “Dumbness of Crowds”

Kathy is dead on in her main assertion, I believe. I’m not sure what percentage of folks who reference the term have actually read the book, but I imagine, unfortunately, it’s not a huge number. Of course, the problem stems from even the misinterpretation of the concepts by those who have already ingested the ideas.

As Kathy points out, there are a number of constraints that surround the power of the wisdom of crowds.  One of these key concepts is the presence of diverse, “specialized” knowledge.  Put simply, this is the stuff we know from our life experience and training.  The main problem with this knowledge in the Internet domain is that this knowledge is quickly, and perhaps easily, tainted as we are often exposed to the internal knowledge of the crowd before formulating our own conclusions.

One example used in the post discusses the Amazon Book Reviews.  The purest review, relatively speaking, is the first review (granted there are any number of reasons why this review is not statstically meaningful, but that’s sort of beside the point).  From the second review onwards, every reviewer is presented the reviews of others and prompted to add their own.  There are a number of reasons why we alter our thinking, but ultimately, we are indeed changed as information flows over us.

technorati tags:wisdom+of+crowds, james+surowiecki, kathy+sierra

Jeff Howe has some breaking news about Gannett’s plans for the future. It seems that they are taking the next step in social media integration - this time outsourcing story research to the masses. As Jeff reports:

Of all the pilot projects the company has conducted over the last few months, the most promising would seem to be the crowdsourcing of in-depth investigations into government malfeasance. Crowdsourcing involves taking functions traditionally performed by employees and using the internet to outsource them to an undefined, generally large group of people. The compensation is usually far less than what an employee might make for performing the same service. Well-known examples include Wikipedia and iStockphoto.

“We’ve already had some really amazing results with the crowdsourcing element of this,” said Jennifer Carroll, Gannett’s VP for new media content. “Most of us got into this business because we were passionate about watchdog journalism and public service, and we’ve just watched those erode. We’ve learned that no one wants to read a 400-column-inch investigative feature online. But when you make them a part of the process they get incredibly engaged.”

Source: Wired.com, “Gannett to Crowdsource News”

I have to commend Gannett for experimenting with this medium. While they’ve made a firm committment to this direction, it is still largely experimental in nature. As one executive notes: “We’re serious about this… Do we have it licked? No. But we’re ahead of the curve. By maybe half a step.”

Ahead of the curve indeed. I’m curious how much of an advantage this truly provides. Ultimately, the medium we’re attempting to wrangle provides quite a bit more transparency into the processes involved. While Gannett might have the largest body of experience - that experience is not necessarily exclusive nor proprietary. I am sure that there is some advantage, but perhaps there’s more to learn from the establish players who are actively tackling these problems.

Naturally, I think that the largest problem still is on the input side rather than the output. The key challenges revolve around managing a workforce and providing the storytelling experience the traditional media consumer’s palette is adjusted to. Like it or not, we bloggers, as journalists, still have a lot left to learn.

The question is who will learn the right lessons first?

technorati tags:crowdsourcing, media, social+media, social+news, gannett

Chris Anderson, purveyor of the Long Tail, has been heard discussing the related concept of the Abundance Economy. While I would love to provide you with a succinct definition, but David Hornick has done a very nice job already:

The Economy of Abundance allows business owners to defer choices to the end users. What better way to find out what consumers want than to give them everything and see what they actually buy. That is the paradigm of abundance. Why get your news programmed by CNN.com when you
can have your news bubble up from the collective wisdom of end users at Newsvine or Reddit? Why get your television programmed by CBS when you can leverage the collective wisdom of the web to find great shows like Lonelygirl15 or Ask a Ninja?
No longer will the success or failure of content be dictated solely by the Economy of Scarcity (e.g. Walmart). Rather, it will be dictated by the will of the consumers, as empowered by the Economy of Abundance.

Much like the Long Tail, the idea of the Economy of Abundance is not prescriptive. It does not tell you how to run your business. But it points to another significant force at work in the new economy and suggests that entrepreneurs should think creatively about how their businesses might be transformed by utilizing abundant resources in a disruptive way. Like the Long Tail before it, I suspect that I will be seeing the Economy of Abundance permeate the presentations that I see in the coming months and year.

Source: VentureBlog, “Chris Anderson Strikes Again: The Economy of Abundance”

This ties in, of course, to the crowdsourcing theme started yesterday that all data needs to be transmuted into information before it is truly useful. In this abundance-driven model, it seems quite reasonable that we are increasingly forced to deal with depleted reserves of attention.

Perhaps the scarcity Anderson says ruled the world has simply been re-assigned to our own attention engines?

technorati tags:longtail, scarcity, abundance, chris+anderson, david+hornick

One of my resident roles in the Lab is to work with clients as they consider different methods for Crowdsourcing. Today, CNet’s got a quick writeup about the efforts at Collective Intellect:

The idea is to give traders back the early and easy access to critical data that they used to have when this information came through many fewer channels. Back in the 1980s and 1990s, a Bloomberg terminal or subscriptions to news services could give you a jump on the hoi polloi. Today, it’s the masses that often have the jump, thanks to blogs and other tipster sites.

“They aren’t sure where a story will break and how it will break,” said Don Springer, Collective Intellect’s CEO. “Traders are going crazy.”

The system examines about 150,000 new postings a day. Then it analyzes them for sentiment–is it causing a stock to go up or down?–and credibility. The company then sends out data feeds and e-mails on stock activity and interesting news to subscribers.

Putting blogs to work for Wall Street | CNET News.com

I am sure that this arena will continue to mature over time in many different directions than we’re considering now. As an old friend from JD Power taught me: “There’s data and then there’s information.” We’re still in a data-rich world as far as it comes to social media - companies like Collective Intellect and BuzzLogic are starting to lay down the bridges that materialize the intelligence we’re seeking.

technorati tags:crowdsourcing, wall+street, collective+intelligence, buzzlogic

The Social Capital blog points to Paul Resnick’s interesting analysis of a paper titled “When is Reputation is Bad?“. Paul summarizes some of the key points as follows, referencing his example of a car mechanic:

1. Information about a player is revealed only when other players are willing to engage with that player, so that getting a sufficiently bad reputation is a black hole that you can’t escape from.
2. There are “friendly” actions; a high probability of friendly actions is what causes partners to we willing to play. (In the mechanics example, honesty is the friendly action.)
3. There are bad “signals” or outcomes that occur more frequently with unfriendly actions but occur sometimes even with friendly actions. It is these signals/outcomes that will be made publicly visible in a reputation system. (In the mechanics example, the bad outcome is recommending an engine replacement.)
4. There are “temptations”, unfriendly actions that reduce the probability of bad “signals” and increase the probability of all the good signals. (In the mechanics example, the temptation is reporting the signal “tuneup” even when the car needs an engine replacement.)
5. The proportion of player types who are committed to the friendly action regardless of its consequences is not too large. (These would be mechanics who would never say “tuneup” when you needed an “engine”, even if it meant closing their business tomorrow.

presnick: When Reputation Systems Are Worse Than Useless

This analysis seems incredibly appropriate in light of the discussion we’re seeing swirl around not only PayPerPost (1,2,3) but also the related sorties surrounding “blogging vs journalism” and “Edelman vs blogging“.

So let’s relate Paul’s points to our universe:

1. We’ve seen the problem with bad reputations becoming as persistent as toilet paper on your shoe in the blogosphere. Specifically, we know that it is extremely difficult (read near impossible) to recover once you have lost your trust
2. Friendly actions in the post-media universe often hangs under the banner of disclosure (you know, the italicized text usually surrounded by parenthesis)
3. Bad signals are quite easy to spot in the blogosphere, and online in general. PayPerPost provides us two cues: first the text provided by the advertiser is a natural cue and second, the quite manual beacon that call’s home (note: it would take about 10 minutes to whip up a greasemonkey script to highlight the “bullshit” if you were so inclined). However, we should not overlook the best tool of all - blogger’s own innate desire to call bullshit on just about anything.
4. Tempations come in the form of link love, technorati rank, and x-list status. Ultimately, we’re more than likely too obsessed already with our standing in the universal scoreboard that we feel less and less incentivized to put the game in play. We don’t want to run the risk of getting caught with our hand in the cookie jar, right?
5. The proportionality of good vs. evil is what has the big minds in the space all worried. Today, the proportion of good players outnumbers bad players (haha, that’s probably not even true relatively speaking).

Which leaves us, yet again, in the same position I’ve been considering. The equation seems as if it will balance itself over time. The notion of balance still seems overrated, if not far-fetched. Perhaps the real worry is that we’re already past the point of equilibrium.

technorati tags:blogging, payperpost, reputation, monetization

It’s nice when you can hear someout out in the trenches confirm the ideas bouncing around in your head like a ball-bearing tickling the sides of spraypaint can.  I just had one of those experiences reading Steve Rubel’s post, “Three Ways to Ride the Long Tail”.  The crux of Steve’s points relates to the power of niches:

Reach metrics are the currency of the advertising community. We’re obsessed with eyeballs, gross ratings points and page views. But in a Long Tail world, reach has entirely new meaning. Many niche sites, for example, can’t hold a candle to the traffic at the head of the media curve. However, what they do have going for them is credibility.

Micro Persuasion: Three Ways to Ride the Long Tail

I could show you slides from my pitch to correlate, but that would just bore you ;)  Steve makes three good points:

• Rethink Reach
• Fund Niches
• Demand More From Media

I definitely recommend it - especially if you’re curious about just what SocialRoots does.

There are more and more examples of just how compelling the next generation of marketing can be for not only the marketer, but the marketed. I’ve been making the case more and more lately that we are now active participants in the process of marketing and publicity as things get more and more difficult to discern.

Certainly, I’m not advocating painting numbers of all of our backs (we did that years ago), but more engaging people in new and interesting ways.

Need some proof? Here’s something MINI just did with their customers.

This campaign falls in line with what Shine’s CEO Greg Sturn said last December about their proposal, “[that] It is basically about the evangelical community of owners (of Minis) and creating technological platforms that recognize those owners and allows them to do what they do — which is be evangelical about the brand,’’ Stern said. He said the agency’s pitch to the company was titled “Evolving the Mini brand without screwing it up.’’

Everything’s Better With Brentter » A MINI community

UPDATE: A new report by McKinsey discusses the drop in TV reach.  One interesting tidbit from the AdAge coverage: “CMOs have to step up to a larger role and question a host of historical assumptions of how marketing works,” Mr. French said. “They have to continue to build rich, robust and proprietary customer insights, but they have to do it from a bunch more sources.”

technorati tags:marketing, media, pr, customers, evangelism, MINI

Favorite quote so far today, from a comment on Jason Calcanis’ blog:

I think the real problem is that Jason has indentified Digg/Newsvine/Reddit as competitors when they’re clearly not. Digg is something dorks do for fun. Netscape is something that wants to pay dorks to deliver interesting links for the masses.

Kevin Rose: The Users shouldn’t be paid… but I’ll take $60M* - The Jason Calacanis Weblog

I’d write more, but what could I possibly add :)

technorati tags:social+bookmarking, digg, netscape, kevin+rose, jason+calcanis

This weekend at BloggerCon, there was lots of interesting discussion. I ended the first day Dave Winer asked us what we’re all doing to change the world. When I had my chance at the mic, I noted that I’m very mindful of the leverage that other companies are creating around the things WE create. Doc dug a little deeper on my point which I quickly whipped out the “user-generated content” banner. My thought, as I’ve noted before, is that we are not users, we’re Active Publishers - reacting to an new environment of swift media.

My main point, however, is that when someone asks us to create something for them and doesn’t pay us, or worst, patronizes us with tokens of their sincerity, that we’re being put in the vice grip and leveraged into larger markets and networks that we can’t easily see from our seats in the nosebleed section.

Today, ShopWiki made a very interesting gesture towards our community:

ShopWiki, an incredibly innovative online shopping community, will announce today another step to expand their service’s offerings. The company will pay users $50 per video for the first 500 submitted product review videos selected for inclusion on the site - that’s $25k total. This site is nuts already and paying people to add video reviews is going to take it over the top in terms of usefulness. Or maybe it’s just really cool. I’m not Mr. Online-shopping by a long shot and even I think ShopWiki is loads of fun to use.

TechCrunch

One interesting counter to my argument was offered by Mary Hodder of Dabble towards the end of the day. She seemed to take a position that I made too sweeping a generalization with regards to those using that term. Her point being that she views herself as a User - referencing her prior role in usability. I went to her afterwards to clear the air a bit - and that conversation is important.

First, I noted that I have no problem with any company that recognizes the value in what they’re asking for and creates a pathway for rewarding the participants. There’s not as many as there should be yet, but there’s quite a bit of activity in this arena and more en route. We’ll never have equal footing if we don’t continue to assert our value.

Second, I still reject the term User-Generated except in the context that I am explicitly requested to create it - at which point I am a user of a system designed to collect something from me. On the other hand, while I surely am -using- Wordpress to make this blog, I am certainly not a user of SocialTwister - I am the publisher, editor, and janitor. Mary’s vantage point that, as a usability person, everyone’s a user simply isn’t sufficient for the range of participating and interaction we have in the world today.

Nothing like winding down a whirlwind trip to San Francisco with a blinking exclamation point, huh?

[full disclosure: I am the CEO of a startup dedicated to getting us all paid for our creativity and ability or to go broke trying]

technorati tags:socialroots, bloggerconiv, mary+hodder, napsterization, dabble, monetization, socialmedia, blogging, videoblogging, podcasting, activepublishing, crowdsourcing

I received a link to this article this morning from a great friend and part-time advisor. It’s an article about how Sony Music has created a new service, called the MusicBox, that is actively encouraging bloggers to use their content as a source of inspiration.

But Sony will also actively encourage fan sites and bloggers–who are mostly used to receiving cease-and-desist letters from studios–to link to the material. Links for adding Musicbox content are displayed on the site. Individuals thus could create sites focused around certain artists by linking to video channels on the Musicbox site dedicated to them, or link to several channels which, in the aggregate, comprise the most mawkish artists (in the view of the blogger) that Sony has to offer.

…

[Jeremy Allaire says] “The media organizations are starting to embrace the idea that their library of assets can be exploited through thousands of touch points,” he said. “It is an opportunity to embrace that urge among consumers to post videos.”

Source: News.com, “Sony Music wants bloggers to promo videos, music“

Can anyone say crowdsourcing?

I can’t say much more about what we’re planning to do with this same industry - opting to build it instead of talk about it, but I’m really pleased to see them making this move at this point in time.