Jeff Howe on Crowdsourcing

In 2005, journalist Jeff Howe was writing a story about MySpace. He wasn’t interested in the site so much as a social network, but as a tool that creative artists, especially musicians, were using to circumvent gatekeepers like music labels. In the process, he got very interested in the kids who were following the Vans Warped tour. These folks practiced “promiscuous creativity”, authoring lots of content and sharing it with each other. It was not always high quality content, but Howe thought their relationship with the process was fascinating. Their use of web designs, video and flash animation was “completely transparent, like we’d use a typewriter.”

In exploring the phenomenon, Howe decided he hated the phrase “user-generated content”. He wondered what he’d find if started looking for “user-generated” anything. His search led him to John Fluevog, a popular shoe designer, who’d introduced a model of “open-source footwear”. Fluevog invited his fans – not just would-be shoe designers – to send him sketches, as rough as they liked, of shoe designs. If he liked them, he’d produce them and name the shoes after you, though not share any revenue.

Howe became convinced that the “user-generated content” we were seeing on blogs and social networks were like looking at Old Faithful – “it’s an amazing phenomenon if you’ve never seen a geyser before,” but it doesn’t show you the really amazing phenomenon, the underground magma that makes the spouting water possible.

Writing about this larger phenomenon – the magma as well as the geyser – Howe coined the term “crowdsourcing”. He showed us screenshots of Google, one showing three matches for the term “crowdsourcing” – “all references from Wired people or folks sleeping with Wired people” – and one a few weeks later showing 669,000 mentions of the term. “It was not the best article I’ve written. There’s lots of research in it, but it’s far from a masterpiece. But I was in the right place at the right time.” As these ideas sometimes do, the article became a blog and the blog became a book.

Howe runs us through some of the key book examples:

A t-shirt contest on (now deceased) web forum Dreamless brought a pair of designers together. The Two Jakes, as they’re now known, decided that they would run a perpetual t-shirt design competition. Their fateful decision: instead of picking the winners themselves, they introduced a voting mechanism, letting fans – potential buyers – vote on the designs they liked. This opened the voting from a small set of experts to a community of people who liked cool t-shirts and were willing to buy them.

The resulting company, Threadless, had $30 million in revenue in 2007, at a 33-34% profit margin. Winning designers are happy to participate, as the contest gives them a $2000 prize, as well as fame. Voters happily rate dozens of t-shirts, and will vote the best shirts by checking a box that says, “I’d buy that”… which registers them for a reminder when the shirt is made and allows the company to estimate how many shirts to print. Users are invited to photograph themselves wearing shirts – and recieve $1.50 in store credit for submitting the photo – which turns customers into evangelists.

In other words, Howe tells us, cheap labor in the 19th century looked like children in mills. Nowadays, cheap labor looks like slackers in their living rooms with laptops.

A web designer living in Calgary, Bruce Livingstone, found himself doing a lot of pro bono design work for friends in the punk music scene. His pet peeve was discovering how much money he needed to pay to license stock photographs for album covers and posters. He built a simple system around his own photographs, uploading his own content and offering it for download using a credit system adopted from the “warez” scene – you get a credit for uploading a photo and it allows you to download three.

The breakthrough for Livingstone was making the decision to charge money – $0.25 – to download a photo. This turned the nascent iStockPhoto site from a small community into a “microstock” agency. These agencies are now eating the lunch of stock photo giants Getty and Corbis. Jonathan Klein, the CEO of Getty, decided to purchase iStockPhoto for $50 million, an investment which looks very smart now that the company brought in roughly $130 million in revenue last year, with a 50% profit margin. Howe tells us that Getty’s core business is flat or declining, but that iStockPhoto projects almost $300 million in revenue in 2012.

There are several other stories Howe works through quickly:

– Ed Melcarek, a freelance engineer who was making his money installing HVAC systems in Barre, Ontario. He started participating in Innocentive.com, a bulletin board where corporations post R&D problems and invite the general public to offer solutions. He’s solved eight major problems, “likely earning six figures” in the process.

– Television network current.tv now shows roughly one third user-created content.

– A group in Washington, DC is starting a crowdsourced restaurant, Elements. It hasn’t opened yet, but the community sourcing the idea has already settled on the lucrative raw food market.

Howe’s model for the rise of crowdsourcing puts the success of the model on the back of four factors:

– The amateur renaissance
– The open source software model, which has emerged as inspiration for these projects
– The democratization of production, which translates primarily as “cheap tools”
– The rise of online communities.

Howe tells us that these projects succeed primarily because of the communities behind him. He ends with a slide that reads, “Ask not what your community can do for you – ask what you can do for your community.”

While Howe’s model of crowdsourcing emphasizes community, he’s troubled by a new research paper by Daren C. Brabham at the University of Utah. Bradum found that while the iStockPhoto community is extremely passionate – over 90% of participants visit the site daily – there was less interest in the community aspects of the site than Howe had guessed, and much more interest in making money. This challenges Howe’s theory that the community is the thing, and that revenue is gravy – the Bradum study seems to find that revenue matters a great deal as a motivator.

(Eszter Hargittai offers her observation that the study may well be methodologically flawed.)

The study is concerning to Howe because his core question is “Why do people participate in community production?” It’s important to answer this question because it has implications for lots of other fields – Howe wonders if stock photography is “the canary in the coal mine”, and whether other creative fields will fall to crowdsourcing. He sees a similar dynamic taking place in graphic design, and wonders if we’re going to see other fields go crowdsourced… like journalism…

I love the examples that Howe offers, but wonder if he’s stacking his deck. His examples are of people doing extremely creative work and getting feedback by other people in the creative community. I wondered whether the sort of crowdsourcing made possible by Mechanical Turk was the same phenomenon as the one Howe was describing.

Howe draws a sharp distinction between the two, observing that Mechanical Turk is highly rote and very ill-paid. He uses the system to transcribe interviews, but argues that there really isn’t a community around transcription the way there is around translation. That said, he suspects that the interest in Mechanical Turk can’t be purely about the money, as Amazon reports that roughly 50% of Turkers are in the US. “I’m not really sure how to explain it.”