Crowdsourcing

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"Crowdsourcing" is a neologism for a business model in which a company or institution takes a job traditionally performed by a designated agent (usually an employee) and outsources it to an undefined, generally large group of people in the form of an open call over the Internet. The work is compensated with little or no pay in most cases, however in a few examples the labor is well-compensated. In almost every case crowdsourcing relies on amateurs or volunteers working in their spare time to create content, solve problems, or even do corporate R&D. The term was coined by Wired magazine writer Jeff Howe and editor Mark Robinson in a June 2006 issue of that magazine.^[1]. Crowdsourcing models are being applied across a broad range of industries, including entertainment, law enforcement, journalism, foreign intelligence, scientific research, and photography.

Contents 1 Overview 2 Advantages 3 Disadvantages 3.1 Disruptive Nature 4 Marketplaces 5 Types of crowdsourced work 6 See also 7 References 8 External links

[edit] Overview

Although it is similar in some aspects, crowdsourcing is a different model from open source projects that have existed for years. People who may not know one another work together online to create complex software such as the Linux kernel, and the Firefox browser. But in the OS model, everybody gets benefits for the global contribution. In recent years internet technology has evolved to allow non-technical people to participate in online projects. Just as important, crowdsourcing presumes that a large number of enthusiasts can outperform a small group of experienced professionals.

[edit] Advantages

The main advantages of crowdsourcing is that innovative ideas can be explored at relatively little cost. Furthermore, it also helps reduce costs. For example if customers reject a particular design, it can easily be scrapped. Though disappointing, this is far less expensive than developing high volumes of a product that no one wants. Crowdsourcing is also related to terms like Collective Customer Commitment (CCC) and Mass Customisation^{[citation needed]}. Collective Customer Commitment (CCC) involves integrating customers into innovation processes. It helps companies exploit a pool of talent and ideas and it also helps firms avoid product flops. Mass Customisation is somewhat similar to collective customer commitment; however, it also helps companies avoid making risky decisions about what components to prefabricate and thus avoids spending for products which may not be marketable later. Crowdsourcing is an example where The Long Tail plays an important part. Each member of the crowd puts forth an insignificant contribution to the total outcome, but the grand total of these contributions amounts to a considerable difference. This technique highly useful in products and ideas the lay person can contribute with. Large amounts of data and contributions are needed to come up with meaningful improvements that represent the collective desire. Sophisticated and educated people are required to crowdsource for highly technical products and services, which puts limitations on the usages and applicability of this method. The New York Times crowdsourced a quote from the newspaper's own blog, The Caucus, for the first time in a March 24, 2007 article. [1]

[edit] Disadvantages

[edit] Disruptive Nature

Crowdsourcing currently threatens serious upheaval in a number of industries. This is best seen in stock photography and celebrity photography, in which the rise of cheap digital cameras (like cell phone cameras) and sophisticated photo editing software have allowed amateurs to create images that compete in quality with long-time professionals. These images are no longer a scarce resource, and thus the price has been driven down by over 90 percent, leading to professionals leaving the field and a net-loss to the economy. Newspapers and other forms of news media are also starting to feel pressure from the crowd, and are reacting by devoting more of their resources to providing space for their readers to write their own blogs or participate in forums. Crowdsourcing also contains the potential for exploitation, in which a company could mine a group of low-paid contributors for ideas and labor under the assumption of eventual compensation, then renege on that arrangement. However, no examples of this have emerged yet.

[edit] Marketplaces

Amazon Mechanical Turk co-ordinates the use of human intelligence to perform tasks which computers are unable to do.

Google Answers was a fee-based "answer brokering" search and research service offered by Google from April 2002 until late December 2006.

The Collaborative Human Interpreter by Philipp Lenssen also suggested using distributed human intelligence to help computer programs perform tasks that computers cannot do well.

Mycroft from the Berkeley School of Information (project site) applies a similar strategy of segmenting work into small tasks and capitalizing on those things that humans are good at but computers are not. Unlike MTurk, Mycroft is a distributed system that gathers knowledge through small, self-contained banners that appear on sites all over the web. In addition, Mycroft does not pay workers. Instead, it relies on a variety of non-monetary incentives.^{[citation needed]}

In Europe, privately funded HumanGrid GmbH, is implementing such a crowdsourcing platform as well. HumanGrid is designed to be a very generic platform, able to map complex workflows and to include several quality management principles.^{[citation needed]}

Both Rentacoder and IPSwap allow people or businesses to request the development of computer programs; software developers can bid and get the contract to write the program.

Subvert and Profit allows advertisers interested in Undercover marketing to purchase actions on social bookmarking services such as Digg, and pays users of these services to perform the actions.

[edit] Types of crowdsourced work

• Procter & Gamble employs more than 9000 scientists and researchers in corporate R&D and still have many problems they cannot solve. They now post these on a website called InnoCentive, offering large cash rewards to more than 90,000 "solvers" who make up this network of backyard scientists. P&G also works with NineSigma, YourEncore and Yet2.
• YRUHRN used Amazon Mechanical Turk and other means of crowdsourcing to compile content for a book published just 30 days after the project was started.
• iStockphoto is a website with over 22,000 amateur photographers who upload and distribute stock photographs. Because it is not burdened by the expenses of a professional organization like Getty Images it is able to sell photos for a lower price. It was recently purchased by Getty Images.
• Cambrian House applies a crowdsourcing model to identify and develop profitable software ideas. Using a simple voting model, they attempt to find sticky software ideas that can be developed using a combination of internal and crowdsourced skills and effort.
• A Swarm of Angels is a project to utilize a swarm of subscribers (Angels) to help fund, make, contribute, and distribute, a £1 million feature film using the Internet and all digital technologies. It aims to recruit earlier development community members with the right expertise into paid project members, film crew, and production staff.
• The Goldcorp Challenge is an example of how a traditional company in the mining industry used a crowdsource to identify likely veins of gold on its Red Lake Property. The challenge was won by Fractal Graphics and Taylor-Wall and Associates of Australia by identifying 110 drilling targets, 50% of which were new to the company.
• Marketocracy, to isolating top stock market investors around the world in head to head competition so they can run real mutual funds around these soon-to-be-discovered investment super-stars.
• My-Currency is a website that brings people together to value residential homes for sale through prediction markets. The company also leverage various social media applications to capture and aggregate local knowledge about homes, neighborhoods, and cities.
• Threadless, an Internet-based clothing retailer that sells t-shirts which have been designed by and rated by its users.
• Public Insight Journalism, A project at American Public Media to cover the news by tapping the collective and specific intelligence of the public. Gets the newsroom beyond the usual sources, uncovers unexpected expertise, stories and new angles.
• Google's PageRank algorithm obtains relevance data for web pages from the web links placed by humans everywhere.
• ESP Game, people to collaborating in labelling images.
• stardust@home project will recruit humans worldwide to help find interstellar dust particles within millions of images taken from the Stardust spacecraft dust collector.
• NewAssignment.net and Assignment Zero, experiment in 'pro-am' journalism

[edit] See also

• Configuration system
• Toolkits for User Innovation
• Buzzwords
• Wisdom of Crowds
• Crowdfunding
• Wikinomics

[edit] References

1. ^ Jeff Howe (June 2006). The Rise of Crowdsourcing. Wired. Retrieved on March 17, 2007.

[edit] External links

• Crowdsourcing: Consumers as Creators, BusinessWeek July 2006.
• Ears Wide Open: Is this the company of the future: Slim Devices, Fast Company Jan 2007. (R&D company using their customers as developers)
• Openeur - Scientific Blog about Open Innovation & Entrepreneurship