Crowdsourcing, the Long Tail, and Prosumption

A small group discussion guide to crowdsourcing and the “New Economy.”

Readings:

“Production, Consumption, Prosumption: The Nature of Capitalism in the Age of the Digital ‘Prosumer’”

“The Long Tail in the Entertainment Industry”

“The Rise of Crowdsourcing”

“When the Crowd Isn’t Wise”

“Human Workers, Managed by Algorithm”

For reference purposes:

“The New Economy”

“User-Generated Online Content”

The “gist”: The New Economy has been brewing since the mid-1990s, but its major impacts have until recently been deflected by such things as the dot-com crash, 9/11, and the mortgage meltdown. But the reorganization of business and society since the Great Recession depends, in large part, on ideas introduced in these readings. Uncoordinated, amateur, and naive users are transforming American life on and off the internet. They are also creating value and abundance, possibly without appropriate remuneration.

The economy of the future depends on the creative labor and production of individuals as much as collective enterprise. It is also fiercely competitive as digital transparency (for example, online price comparison) drives profit margins down to near zero. Middlemen are being eliminated by technologies of disintermediation, and whole economies are being bypassed by globalization of commerce. Traditional authorities are increasingly undermined and becoming radicalized (examples: Tea Party members, Islamic fundamentalists, librarians).

Key terms and definition:

The Long Tail – A term coin by Chris Anderson in 2004 framing the phenomena of niche markets composed of products and services in low demand and low sales volume. Reduced marketing and distribution costs in the twenty-first century have made these niches potentially profitable for individuals, challenging the traditional markets for “bestsellers” and “blockbusters.”

Content Aggregator – An organization or individual that collects online media from various sites and repackages it for reuse or resale on another site.

User Generated Content – Media product and recommendations crafted by amateurs rather than recognized experts and professionals.

Virtualization – Changing physical objects into digital products. The movement of music from CDs and CD making factories to digital music download sites is an example.

Molecularization – The transformation of the markets for production, distribution, and consumption of goods and services from the masses to individuals. The new economies of scale are smaller, plural, and austere. Bigger isn’t better anymore.

Disintermediation – The removal of an intermediary, or middleman, from a transaction or communication. The user or consumer gains direct access to information that otherwise would require a mediator, such as a salesperson, a librarian, or a lawyer.  New technologies give users the power to look up medical, legal information, travel, or comparative product data directly.

Prosumption – A portmanteau coined by futurologist Alvin Toffler combining the terms “producer” and “consumer,” emphasizing the falsity of the dichotomy of the two.

Convergence – The combination of old industries into new and vital ones. One example is the combination of newspaper, television, and web companies into “new media” empires.

Wisdom of Crowds – Collective intelligence producing superior (or mediocre) judgment.

Folksonomy – Collaboratively sorting, tagging, or classifying content using internet technologies. Participating in such a venture is sometimes called microvolunteering (see for example Galaxy Zoo or Foldit).

Discussion questions:

Does crowdsourcing produce quality or mediocrity? Can a crowd really defeat experts and professionals at all things? Or is crowdsourcing really best for accomplishing simple or nonserious tasks? Consider the list of 2,000+ crowdsourcing sites at http://www.crowdsourcing.org/directory.

Who can actually make a living in a crowdsourced business like Amazon’s Mechanical Turk or InnoCentive? Is a system based on large groups of competing workers paid little (or nothing) for their efforts sustainable over the long haul? Is this unethical exploitation of the labor market?

What motivates people to do work for free?

What mundane activities and personal tasks in your daily life would you like to outsource/crowdsource to TaskRabbit? (See https://www.taskrabbit.com/how-it-works)

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