Category Archives: filter

gift economy or honeymoon?

There was some discussion here last week about the ethics and economics of online publishing following the Belgian court’s ruling against Google News in a copyright spat with the Copiepresse newspaper group. The crux of the debate: should creators of online media — whether major newspapers or small-time blogs, TV networks or tiny web video impresarios — be entitled to a slice of the pie on ad-supported sites in which their content is the main driver of traffic?
It seems to me that there’s a difference between a search service like Google News, which shows only excerpts and links back to original pages, and a social media site like YouTube, where user-created media is the content. There’s a general agreement in online culture about the validity of search engines: they index the Web for us and make it usable, and if they want to finance the operation through peripheral advertising then more power to them. The economics of social media sites, on the other hand, are still being worked out.
For now, the average YouTube-er is happy to generate the site’s content pro bono. But this could just be the honeymoon period. As big media companies begin securing revenue-sharing deals with YouTube and its competitors (see the recent YouTube-Viacom negotiations and the entrance of Joost onto the web video scene), independent producers may begin to ask why they’re getting the short end of the stick. An interesting thing to watch out for in the months and years ahead is whether (and if so, how) smaller producers start organizing into bargaining collectives. Imagine a labor union of top YouTube broadcasters threatening a freeze on new content unless moneys get redistributed. A similar thing could happen on community-filtered news sites like Digg, Reddit and Netscape in which unpaid users serve as editors and tastemakers for millions of readers. Already a few of the more talented linkers are getting signed up for paying gigs.
Justin Fox has a smart piece in Time looking at the explosion of unpaid peer production across the Net and at some of the high-profile predictions that have been made about how this will develop over time. On the one side, Fox presents Yochai Benkler, the Yale legal scholar who last year published a landmark study of the new online economy, The Wealth of Networks. Benkler argues that the radically decentralized modes of knowledge production that we’re seeing emerge will thrive well into the future on volunteer labor and non-proprietary information cultures (think open source software or Wikipedia), forming a ground-level gift economy on which other profitable businesses can be built.
Less sure is Nicholas Carr, an influential skeptic of most new Web crazes who insists that it’s only a matter of time (about a decade) before new markets are established for the compensation of network labor. Carr has frequently pointed to the proliferation of governance measures on Wikipedia as a creeping professionalization of that project and evidence that the hype of cyber-volunteerism is overblown. As creative online communities become more structured and the number of eyeballs on them increases, so this argument goes, new revenue structures will almost certainly be invented. Carr cites Internet entrepreneur Jason Calcanis, founder of the for-profit blog network Weblogs, Inc., who proposes the following model for the future of network publishing: “identify the top 5% of the audience and buy their time.”
Taken together, these two positions have become known as the Carr-Benkler wager, an informal bet sparked by their critical exchange: that within two to five years we should be able to ascertain the direction of the trend, whether it’s the gift economy that’s driving things or some new distributed form of capitalism. Where do you place your bets?

under the influence

The Wall Street Journal has an interesting (and free) piece on a new class of individuals — filters, recommenders, editors, curators, call them what you will — that is becoming increasingly influential in directing attention traffic across the Web. The article focuses primarily on top link hounds at user-filtered news sites like Digg, Reddit and the newly reborn Netscape, sites whose aggregate tastemaking muscle has caught the attention of marketers and product placers, who have made various efforts to buy influence through elaborate vote-rigging schemes and good old-fashioned payola. The article also makes mention of some notable solo filtering acts including a regular stop of mine,, a video archive operated by a young Canadian named Jeff Hoard. At the end of the piece there’s a list with links of other important “influencers.”
While I was reading this I kept thinking of Time Magazine’s “The Person of the Year is You”, which caused a minor stir last December with its cover containing a little mirror in a YouTube-like screen. On one level the piece was simple trend-spotting, a comment on the phenomenon (undoubtedly reaching new heights in ’06) of social media production. But it could also be read as a thinly camouflaged corporate memo announcing big media’s awakening to the potentially enormous profits of an ad-based media network in which the users do all the work of filtering. And it’s precisely the sorts of “influencers” in this WSJ piece that are the “you” on which they are hoping to capitalize. The “you” that convinced Google that $1.8 billion was a price worth paying for YouTube, or Rupert Murdoch a half billion for MySpace (I would have liked to have heard more in the article about the way this phenomenon is playing out on these two sites through the video “channels” and friend networks).
It all adds up to a pretty astonishing redefinition of what “the media” is. The front page, the lead story, the primetime lineup — all in constant renegotiation, constantly rearranged. Yet still in so many ways dependent on the established sources for the materials to be filtered (and probably in the future for personal income, as is already beginning). Feeders and filterers. The new media ecology doesn’t destroy the old one, it absorbs it into a new relationship.

the end of media industries

Imagine a world without publishers, broadcasters or record labels. Imagine the complex infrastructure, large distribution networks, massive advertising campaigns, and multi-million signing contracts provided by the media incumbents all gone from our society. What would our culture look like? Will the music stop? Will pens dry up?
I would hope not, but I recently read Siva Vaidhyanathan’s book, The Anarchist in the Library, and I encountered a curious quote from Time Warner CEO, Richard Parsons:

This is a very profound moment historically. This isn’t just about a bunch of kids stealing music. It’s an assault on everything that constitutes cultural expression of our society. If we fail to protect and preserve out intellectual property system, the culture will atrophy. And the corporations wont be the only ones hurt. Artists will have no incentive to create. Worst-case scenario: the country will end up in a sort of Cultural Dark Age.

The idea that “artists will have no incentive to create” without corporations’ monetary promise goes against everything we know about the creative mind. Through out human history, self-expression has existed under the extreme conditions, for little or no gain; if anything, self-expression has flourished under the most unrewarding conditions. Now we that the Internet provides a medium to share information, people will create.
A fundamental misunderstanding in the relationship between media industry and the artist has produced an environment that has led the industry to believe that they are the reason for creative output, not just a beneficiary. However, the Internet is bringing the power of production and distribution to the user. And if production and distribution — which are where historically media companies made their money — can be handled by users, then what will be left for the media companies? With the surge in content, will media companies need to become filters and editors? If not, then what is there?
The current media model depends on controlling the flow of information, and as information becomes harder to control their power will diminish. On the internet we see strong communities building around very specific niches. As these communities get stronger, they will become harder to compete with. I believe that these niches will develop into the next generation media companies. These will be the companies that the large media companies will need to compete with.
The challenges that the current media companies face remind me of what happened to AT&T in the 1990s. After being broken up into “baby-bells”, AT&T was left providing only long distance. It was just a matter of time before the “baby-bells” began eating away at AT&T’s business from below, and there was little AT&T could do about it.
I think Richard Parsons’ quote shows a misunderstanding not only in the reason why people share information, but also in the direction of new technologies. For that reason I do not have much hope for the current media companies to adjust. Their only hope is to change and change represents their demise.

future of the filter

An article by Jon Pareles in the Times (December 10th, 2006) brings to mind some points that have been risen here throughout the year. One, is the “corporatization” of user-generated content, the other is what to do with all the material resulting from the constant production/dialogue that is taking place on the Internet.
Pareles summarizes the acquisition of MySpace by Rupert’s Murdoch’s News Corporation and YouTube by Google with remarkable clarity:

What these two highly strategic companies spent more than $2 billion on is a couple of empty vessels: brand-named, centralized repositories for whatever their members decide to contribute.

As he puts it, this year will be remembered as the year in which old-line media, online media and millions of individual web users agreed. I wouldn’t use the term “agreed,” but they definitely came together as the media giants saw the financial possibilities of individual self-expression generated in the Web. As it usually happens with independent creative products, large amounts of the art originated in websites such as MySpace and YouTube, borrow freely and get distributed and promoted outside of the traditional for-profit mechanisms. As Pareles says, “it’s word of mouth that can reach the entire world.” Nonetheless, the new acquisitions will bring a profit for some while the rest will supply material for free. But, problems arise when part of that production uses copyrighted material. While we have artists fighting immorally to extend copyright laws, we have Google paying copyright holders for material used in YouTube, but also fighting them.
The Internet has allowed for the democratization of creation and distribution, it has made the anonymous public while providing virtual meeting places for all groups of people. The flattening of the wax cylinder into a portable, engraved surface that produced sound when played with a needle, brought the music hall, the clubs and cabarets into the home, but it also gave rise to the entertainment business. Now the CD burner, the MP3, and online tools have brought the recording studio into the home. Interestingly enough, far from promoting isolation, the Internet has generated dialogue. YouTube is not a place for merely watching dubious videos; it is also a repository of individual reactions. Something similar is happening with film, photography and books. But, what to do with all that? Pareles sees the proliferation of blogs and the user-generated play lists as a sort of filter from which the media moguls are profiting: “Selection, a time-consuming job, has been outsourced. What’s growing is the plentitude not just of user-generated content, but also of user-filtered content.” But he adds, “Mouse-clicking individuals can be as tasteless, in the aggregate, as entertainment professionals.” What is going to happen as private companies become the holders of those filters?