If you click on the “contact us” link on the side of this page, it sends an email directly to me. I’ve been amazed at how many great stories and contacts I’ve received through this link, but occasionally I’ve been overwhelmed by them - and thus unable to respond to everyone, let alone share all of the messages with wikinomics readers. This has been particularly true over the last couple of months, due to various other work commitments and a couple of excellent vacations thrown in the middle. But I apologize to those who wrote that I have not yet responded to (I will try to address this shortly), and want more importantly I want to start sharing a lot more.
In turn, I’m going to start with what I consider to be the most interesting messages I receive - information about new start-ups that appear to be being built on wikinomics principles (all titles will involve the words Wikinomics in Action Start-Up). What’s slowed us down in the past is we try to investigate them all fairly thoroughly, which can take a lot of time. Instead, I’m going to throw up here the link, a summary of any extra information an individual may have sent us, and a couple more tidbits from the site, and then ask the community for feedback on it. What I’d really love to see is our readers collectively helping out some new start-ups (constructive criticism, new ideas, etc)… so I implore you to get involved.
For no other reason than that I got the message this morning while I was thinking about this, today I’m going to start with Laboratory Films. The new entity describes itself as a network based filmmaking enterprise, and is honest in saying they are not the first in the category. How they are seeking to differentiate themselves is:
- being profit oriented.
- requiring no financial backing from investors and no financial participation from its peers.
- running on a simple, global, public system.
As a serious music fan who used to pride himself on being ahead of curve on the latest and greatest artists, my recent stumbling upon popcuts was music to my ears (awful pun acknowledged). The community, launched by three music afficionados, with certain haunts of pyramid-scheme-like simplicity, rewards early adopters for the purchase of up and coming artists’ tracks.
By rewarding those who are really taking a chance by purchasing cutting-edge/often unheard of music, I think popcuts is really on to something here…Each track sells for 99 cents, of which the site takes 10-20%, with the artist able to dictate how much of the remaining funds they would like to claim. The remainder of the $0.99 is earmarked for distribution to every person who has already purchased the track.
While I wouldn’t suggest liquidating your savings account to make a quick cash-grab (unless your ideal portfolio consists of music credits), the site’s value proposition capitalizes upon important principles that I think will make this going concern, if not a solid buyout target for one of the bigger music stores out there (shudder): Read More »
Note from Denis: this blog post ended up being a lot longer than I expected. The first seven paragraphs focus more on the “challenges” these sites are facing, but I encourage readers to check out the bottom 3 or 4 about what Marketocracy has been up to this year- they could be hitting a very interesting tipping point in their model, in a good way.
In February of 2007 I wrote a post entitled The Perils and Promise of Marketocracy, a company that was taking a very wikinomics-type approach to finding the “best investors in the world by tracking, analyzing and evaluating their performance in managing virtual portfolios on the site.” While I was, and continue to be, quite intrigued by the possibilities of their model, the bulk of the post was fairly critical. The reason for this was a clear disconnect between the performance of the virtual m100 index, which was based on the stock picks of the best investors in the Marketocracy community, and the Marketocracy Masters 100, which was the real mutual fund supposedly based on the m100.
The main problem I had is pretty easy to demonstrate For example, if you looked at the performance of the virtual fund (as posted on the site), it seemed to perform remarkably well from (for example) January ‘03 to January ‘05- a net gain in the 70 % range. If you looked at the performance of the real fund over the same time period, it went from $9.93 on January 3rd 2003 to $10.86 on January 7th 2005. Suffice to say, that’s a lot less than 70%- which doesn’t make a lot of sense if one is based on the other. You can read the post for more details, which was an update on the original post (after I interviewed the CEO).
I suppose it was only a matter of time before something like this came along and I have been anxiously waiting to see how this one pans out. Launched in July, on seemingly razor-thin legal ice, it appears that beta site mygazines is still alive and kicking (not to mention enjoying the spotlight gained from a widespread AP news release).
The site provides member-scanned full digital copies of magazines, which can be browsed, shared, archived and even re-assembled to create aptly-named “mygazines”. The site is hosted by Stokholm-based PRQ, “the world’s least lawyer-friendly hosting company“, which is also host to (and owned by two founders of) well-known bittorrent tracker, The Pirate Bay.
Interestingly, the site tour appears to be targeted at publishers, pitching itself as multi-faceted growth opportunity, but most industry leaders asked aren’t exactly jumping at the “opportunity”.
Why should I upload my publication to mygazines.com?
Our article-level search and archiving ability allows your audience to find the content they’re looking for faster
Increase your distribution and advertising revenue by exposing your publication to more eyes
Keep control of your publication: Mygazines will not allow for downloading or printing of your publication. Your original source file is never accessible.
Save the trees - no paper will be used in the making of your virtual publication
If you’ve been able to get through the high traffic loads on cuil.com (pronounced “cool”, meaning “knowledge” in Gaelic) today, you’ve been one of the first to use the world’s newest search engine that is (in its own words) poised to dethrone the undisputed king of search.
Self-proclaimed to have indexed three times more pages than Google and 10 times more pages than Microsoft, Cuil is the brainchild of Tom Costello, Anna Patterson and Russell Power, formerly of IBM and Google. With some pretty direct attacks on other unnamed search engines that “rely on superficial popularity metrics,” Cuil’s philosophy is “to solve the two great problems of search: how to index the whole Internet—not just part of it—and how to analyze and sort out its pages so you get relevant results.”
While I was unable to complete many searches effectively today due to overwhelming traffic to the site, Cuil appears to have great potential and I am intrigued by the service’s promise to “guide [me] towards answers to the questions [I'm] not even sure how to ask.”
Another advertised feature that is sure to attract attention is cuil’s privacy policy that can be summed up in short by their tagline “your search history is your business, not ours.” (It should be interesting to see how long this lasts.) Read More »
Joe Westhead sent me an interesting email awhile ago in relation to the ongoing MyFootballClub experiment (and has an intriguing post on the subject that I’ll come back to later). For those that may have forgotten, MyFootballClub became relatively famous as it sought out 50,000 fans to not only co-own a professional football (soccer in North America) team, but manage it through the “wisdom of crowds” principles. To quote one of the many articles on their plans (wikipedia has a great overview of their history):
The probable new owners will manage the club, voting online to choose match lineups and buying new players. To help run the team, the fans will be able to view all the matches online and, after the game, receive statistics on how each player has performed. They will also get weekly updates from the team’s head coach on how each player is doing during practice.
It sounded really good - and most commentators particularly focused on the ability to vote on line ups as a key driver of participation. This functionality went live recently, but was hardly a resounding success - less than 2,000 of the over 30,000 members voted on the line ups for some recent games, and the vast majority that did bother to vote elected to let the coach decide. This lack of involvement has led to several articles like this one, which sees it not only a hugely negative development, but as potentially foreshadowing the collapse of the entire experiment. But is it really that bad?
A darling of the Wikinomics blog (1,2,3), Radiohead has impressed before, and with their latest video for House of Cards, they do so again. Maintaining their promise not to make any conventional music videos for their anything but conventionally released In Rainbows, the band’s latest video was made using Geometric Informatics and LIDAR (think radar, but with light) technology normally reserved for geographic mapping and catching speeding cars, among other things.
Can Wikinomics transform blood diamonds into a girl’s best friend?
This week I will profile the South African based diamond company De Beers.I case you missed my last report card on Blizzard Entertainment; you can find it here.I would like to thank Will Runyon for suggesting this week’s topic and directing me to this excellent Wall Street Journal article.Like my previous entries, I will be evaluating De Beers on the Wikinomics principles of being open, peering, sharing, and acting globally.
I must admit - I was caught off-guard and even found it comical when I heard that Rihanna was lauching her own line of umbrellas (or should I say, um-ber-ellas) and I found the song Air Force Ones pathetic - but the blurring of lines between “music” and “promotional piece” is seemingly here to stay.
An increasing number of artists are now signing recording deals with consumer product companies such as Nike, Red Bull and Procter & Gamble, who are acting as de facto record companies - finding, funding, promoting and in cases even distributing new music. In an effort to promote various product lines, these companies have now begun to look outside of their core businesses for a new way to get their brands “out there.” Read More »
At nGenera’s Gov 2.0 conference at Harvard last week, I had the opportunity to meet Ben Rattray. Ben founded Change.org, a Facebook-like social-networking site specifically designed for engaging people in social change. Change.org seeks to maximize social good, not monetary profit. So imagine my surprise when Ben told me that it is not registered as a non-profit, but as a corporation.
For about as long as corporations have been the dominant form of value creation in society, they have been viewed as enemies by social activists. Naomi Klein’s No Logo documents the rise of a social movement in the 1990s that is specifically anti-corporation. The 2003 book and film The Corporation has taught a generation of socially concerned youth that corporations act, by flawed design, like psychopaths. “The corporate model is broken and must be changed,” is perhaps one of the most unifying mantras across the diverse range of social activists.
And here’s this guy Ben, starting a network for social change, and he incorporated it? Did he not get the memo?
Actually, I believe that this is an example of a much larger trend that is remaking the model of the corporation, blurring the line between businesses and NGOs, redistributing corporate power from shareholders to communities, and marking the beginning of a post-capitalist society.
Within hours of the release of the Firefox 3.0 web browser, a vulnerability was found in the code that puts all PC users of Firefox at severe risk. The press release from TippingPoint’s DVLabs is sparse in detail for security reasons, but it does explain that the vulnerability could enable “an attacker to execute arbitrary code.”The good news is that an unnamed researcher did find the problem and sell it to TippingPoint’s Zero Day Initiative. TippingPoint’s Zero Day Initiative is currently working on a patch to correct the problem, which it will then sell to Mozilla. The Zero Day Initiative is an open call for researchers to find potentially devastating program vulnerabilities. TippingPoint will then pay the researchers for their discovery and develop a solution to the problem.
This situation is open source collaboration at its finest. Mozilla made the source to Firefox open source. This allows them to harness the researching power of thousands without employing any of them. In addition they don’t even need to employ full time programmers to fix the problem. TippingPoint programmers find a solution to the problem and sell Firefox only what they need. The researchers are also happy because they are compensated for any discoveries that they find. Every one is a winner.
Many people believe that it is impossible to make a profit using open source, but this is clear evidence that the belief isn’t true. TippingPoint and Mozilla are utilizing open source to achieve greater profitability than would be possible using traditional business methods. In addition, they are able to create a safer, higher quality product. The benefits of open source are undeniable, and you can expect more companies to utilize this power in the near future.
Dave Balter (check out Bzzagent to learn more) has published a new book recently - The Word of Mouth Manual, Volume II, featuring a rather sad but thoughtful looking monkey on the cover. While I can’t speak to the quality of the book just yet (though I’m quite sure it will be good), the way he has brought it to “market” so far is fairly unique. Notably, you can purchase the book in all it’s bounded goodness from Amazon for $45, or alternatively you can download it for free - an offer exclusively available through about 20 members of Dave’s network that he considers to be the biggest, baddest thinkers out there (a social marketing /marketing 2.0 crowd mostly).
I like the strategy for a number or reasons - with being able to skim his book for free at the top of my list of course. I emphasize skim because it’s highly, highly unlikely I’ll read the entire book on my laptop - if I want to read the whole thing, I will probably buy the “real thing”.
From a promotion standpoint, each of the 20 people Dave allowed to exclusively offer the link naturally wrote a blog post the book, which is a great way to generate… wait for it… word of mouth marketing the The Word of Mouth Manual. Seth Godin’s (What Dave just did) was my favorite of all the related posts, but many of them are quite interesting… and the “side” benefit of good publicity for BzzAgent might be is most likely worth more than all of the potential book royalties anyway.
Here’s an interesting little story from TorrentFreak - when Mr. Suitcase published an album last year, he started receiving payments from Stim (the Swedish Performing Rights Society), which is funded via a tax on all recordable media in Sweden. This is often referred to as the “Pirate Tax”, as it is designed to compensate artists for having their creative output “stolen” in various ways. To quote Mr. Suitcase on how he responded:
“First, I got a bit put off by receiving the money because to me, that kind of arbitrary hand-out of alms is a ridiculous system. Then I thought, why not see it as an opportunity and earmark the money for something creative. And since the money came from piracy, I had to use it for more piracy, right?”
So he created a new album, fully funded by the tax, by using other people’s music and putting it through some old effects boxes he acquired. In turn, the end result is what some might call a pirated mash-up album, fully funded by an anti piracy tax. I’m sure not everyone would agree with his approach, but one (or at least I) have to love the mindset he took to get there:
“To me, ‘Frauds’ is a statement. There’s so much negativity in the debate. ‘File sharing means artists can’t…’, ‘File sharing means nobody will ever…’ I think it’s the opposite, I think the beautiful aspect of the digital era is that anything recorded can be remixed, tweaked and modified.”
David Meyer has posted an interesting story on ZDNet, where Dr. Ari Jaaksi (Nokia’s VP of software) argues that open source developers targeting the mobile space need to learn business rules - including DRM. Here are a few of his relevant quotes:
“There are certain business rules [developers] need to obey, such as DRM, IPR [intellectual property rights], SIM locks and subsidised business models.”
“Why do we need closed vehicles? We do. Some of these things harm the industry but they’re here [as things stand]. These are touchy, emotional issues, but this dialogue is very much needed. As an industry, we plan to use open-source technologies, but we are not yet ready to play by the rules; but this needs to work the other way round too.”
Like the music industry and the publishing industry, the writing on the wall is bold, capitalized, and neon for yet another industry reluctant to change in the face of Web 2.0 forces far too powerful to ignore.
Officially, IT analyst firms are a $2.5 billion dollar business, of which about $1 billion belongs to the industry behemoth Gartner. As impressive as this number might seem, it represents only a fraction of the total IT analysis actually being traded. There is a social media undercurrent running just below the surface of the IT analysis industry—call it “IT Analysis 2.0” or “Open Source Analysis,”—where insightful content is not bought and sold, but rather offered up for free. Examples include enterprises like RedMonk, Freeform Dynamics, MWD, and Enterprise Irregulars, as well as community-driven sites such as IT Toolbox and Wikibon (IT analysis a la Wikipedia).
Like MySpace and YouTube in the entertainment industry, the social media undercurrent in the IT analysis industry is threatening to build up to tsunami proportions. Witness the most recent Institute of Industry Analyst Relations poll results below. While the top three analyst firms are predictable, open source analyst firms RedMonk and Freeform Dynamics are making significant gains. Notably, two of the top five individual analysts are from RedMonk.
A very interesting project garnering massive attention online is brandtags.net, set up by Noah Brier. The site features countless images of brand trademarks and asks users to input the first word or sentence that comes to mind upon viewing each logo. Answers are then compiled to create tag clouds reflecting the magnitude of each response.
With over 600,000 responses in 12 days, the site’s success has come as a huge surprise to Brier and it is a great example of mass collaboration to leverage collective “intelligence”. The project presents a great opportunity for progressive organizations to receive unfiltered feedback (and in many cases, reality checks). Check out the site yourself to see how your perceptions compare with the masses’.
I had the pleasure of being on a blogger panel with Sean Moffitt last week, who (among other things) is the author of the always insightful Buzz Canuck blog - a must read for people interested in word of mouth marketing and developing “wiki brands”. I think wikinomics readers might find his May 16th post particularly interesting. In it, he discusses two German terms came across in his recent research, gemeinschaft and geshellschaft, which are sociological categories that were introduced by German sociologist Fredinand Tonnies in 1887.
Gemeinschaft is used to describe associations in which the “greater good” of the collective is of equal to or greater importance than individual self interest - often translated as “community”. Geshellschaft is the opposite - where individual self interest trumps the greater good, often “lacking the same level of share mores.” Interestingly, this is often translated as “society” or “civil society”, which might just go a long way in describing a lot of the societal issues that we face today. It is also notable that, in business usage, it is often the term for “company”.
In his post, Sean goes on to point out the challenge he often comes across in business today - companies trying to build gemeinschaft into their geshellschaft structures (it just sounds uncomfortable, doesn’t it? I think that’s why I like the terms so much). The traditional response from many companies is that it can’t be done. Sean thinks it can happen, and we agree with him - but figuring how to make it work is a great challenge.
Back in March we highlighted a very interesting post on Kevin Kelly’s blog entitled 1,000 True Fans. It started out with the observation that while the long tail is great for consumers and certain aggregators, it’s “a decidedly mixed blessing for creators.” The idea here is that the long tail creates massive competition and relentless downward pressure on prices - and is something that artists would do best to “escape.” The escape route covered in the article is to find the 1,000 true fans.
Setting aside the fact that I have a slightly more positive view of the long tail, it’s an interesting idea - any “creator” simply needs to find their niche that will buy any and everything that they make. It appears that 1,000 was chosen just to make the numbers simple - i.e. make the point that at $100 a pop that grosses to $100,000 a year, which most people would consider a great living.
The post then goes on to put in a number of caveats and distinctions - groups will obviously need more fans than singles, it will be different by media, etc. It’s a great post from start to finish, and what makes it even better is the two follow-ups that have recently been posted on the site: The reality of depending on true fans and The case against 1,000 true fans.
The idea that online social networks will make money selling eyeballs (advertising) or products is missing the entire value proposition of a social network. The real opportunity is in harnessing the rich data that is created by those participating in conversations and interacting with each other. I recently finished some research on two amazing social networks in the healthcare space – Sermo and PatientsLikeMe – that seems to have figured this out.
The model itself is not complex; both communities commercialize their value of relationship data by aggregating and anonymizing it, and then finding third parties that benefit from, and are willing to pay for the rich data created by the community. In the case of these healthcare communities, the third parties are pharmaceuticals, insurance companies, and financial services firms. Both companies do this in a completely transparent way that is clear to users. Unlike the traditional advertising model, the conversations and interactions create the value, not the number of members. If you think about traditional Web metrics such as hits or unique visitors as a measure of success, neither Sermo nor PatientsLikeMe would rank very high.
Now to Facebook – often balked at for its $10-$15 billion estimated valuation, and derided for its failure with the Beacon advertising platform – the social network has yet to identify a solid business model. The company recently announced a small analytic feature that presents aggregated, anonymous user data that could in fact be extremely valuable to companies. The Facebook Lexicon launched with little fanfare, but effectively allows users to chart “buzz” or the viral popularity of various terms (warning: this very cool tool has the potential to impede work productivity).
As we have written before, emerging markets are often a hotbed of innovation. Difficult local market conditions force companies to invent new and creative ways of meeting their customer’s demands. For instance, the Indian bank ICICI is able to offer banking services to people with very low balances and high transaction volumes by employing low cost channels coupled with the latest IT. Many of these innovators are looking at entering western markets with their low cost business models.
The handset industry is no different. Spice, a small Indian mobile company, has recently unveiled a sub-$20 handset. Needless to say it is basic, with no screen and a clunky exterior. However, market potential is huge. The company is looking at marketing the phone to 2.5 billion people. Read More »
Technology and the US election I've written several times about the impact of social networks on this year's US Presidential election - see here and here. And let's be honest, the use of such networks and new web 2.0 technologies has been dominated by Obama. He’s embraced social networks like no other candidate in an attempt to connect with [...]
