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Friday, July 21, 2006

ON PAYMENT FOR PEER PRODUCTION (PART II)

TO PAY OR NOT TO PAY

A little bit of a kerfuffle to be seen on Techmeme the past few days over the issue of whether or not "Web 2.0" companies should pay for "amateur" content (aka "user-generated content", or Jason Calacanis's term "crowd-sourcing").

The issue has re-surfaced in recent days, partly due to Jason Calacanis, who's currently leading the makeover of AOL's Netscape property into a Digg-like content discovery service.  His recent post counters one by Michael Arrington of TechCrunch, who thinks the offer to pay for top "Diggers" to switch from Digg to Netscape smacks of desperation.

In a post last October titled "On payment for peer production", I'd asked:

"In a world where the "peers" in peer production are paid mostly in convenience or reputation (aka vanity) in the case of blogs, user comments and the like, one wonders how far we are from a time when a search engine and other web 2.0 businesses offer a piece of the cash to users for their attention and loyalty in any form."

And the answer was, not too long.  The time is upon us.

And the issue is encompassing not just WHETHER Web 2.0 and/or media companies should pay for "amateur" content, but WHAT  LEGAL ownership rights should these users accrue.

In recent days, popular video-sharing site YouTube changed it's "Terms of Service" (aka TOS), giving themselves more flexibility to re-use and re-purpose user-uploaded videos without payment to the original up-loader, AS LONG as the content remains on YouTube (see this BoingBoing post for more).

In my post from last year, I categorized four drivers for users to provide their services to "Web 2.0" companies:

  1. Convenient functionality for all (e.g., Flickr, Del.icio.us, Wikipedia and  of course, Google).
  2. Reputation as in the case of bloggers, reviewers and commentators on the web (aka vanity).
  3. Generosity, as highlighted by Tom Evslin in the discussion at the USV session.  Good example here are the mostly anonymous contributions by countless folks to entries in Wikipedia.
  4. Monetary compensation direct and indirect, as in the case of eBay sellers who get direct cash from sales and Google advertisers, who presumably get transactions from the leads they pay for through Adsense and Adwords on the service and affiliates.

Since most Web 2.0 companies are increasingly being run as businesses aiming to be much bigger and profitable businesses, I suspect we'll see more instances of compensation for "crowd-sourcing".

And as in most things, we'll have instances where it'll work, and many where it won't.

But one thing is for sure...just as the internet itself lost it's "innocence" to commercialism in the mid-nineties, "web 2.0" (or "user-generated content" or "crowd-sourcing") is about to make the same transition in the middle of the first decade of the new century.

Posted at 01:55 PM in Broadband and beyond, History of Technology, Interesting New Web Companies, Media, Old Tech Used New Ways, Politics, Software, Technology: Unintended Consequences, Web/Tech, Weblogs |

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