Umair Haque / Bubblegeneration
umair haque  

 
 


Design principles for 21st century companies, markets, and economies. Foreword by Gary Hamel. Coming January 4th. Pre-order at Amazon.


 
Wednesday, May 31, 2006

Research Note: The New Bourgeoisie


There's a new bourgeoisie in town, and they are just a wee bit elitist when it comes to connected consumption. You know the meme they're pushing by now; but if you don't, Jaron Lanier sums it up nicely for us:

"...But the hive mind is for the most part stupid and boring."

Of course, Jaron here echoes folks like Nick Carr, Esther Dyson, etc.

I find this absolutely fascinating. Why? Because all of these folks are very intelligent, very sharp, very well-read, and very intellectual - but in this case, their arguments aren't just elitist, lame, and reminiscent of corporatethink. Their arguments are deeply intellectually bankrupt: they're not making real arguments at all.

Usually, the meme goes something like this. Look at Myspace, it's ugly. Look at Wikipedia, it's inaccurate. Look at Digg, it's irrelevant.

Of course, the unstated assumption is that yesterday's forms, standards, business models, etc are somehow more ideal than today's. Which is a bit absurd on it's face.

Consider: Lanier tells us that product reviews in newspapers are more valuable than peer reviews. Really? Does he honestly not know that, like the top 40 charts, the NYT bestsellers list/reviews have been gamed by publishers for the last fifty years? From an economic point of view, this is a textbook example of monopoly power leading to a simple dead-weight loss; you end up reading books and listening to music you probably don't like. Value isn't created - in fact, it's destroyed.

But more tellingly (and more amazingly), the people that make this argument never manage to marshal any real evidence in support of it.

Instead, they just tell us how offended their sensibilities are. As Nick C's recent dust-up with Jimmy Wales demonstrated (where Nick's claims about Wikipedia's structure were fast debunked) - this school of thought doesn't actually explore if the hive really does suck.

Here's a more recent example, again from Jaron L:

"...The collective rises around us in multifarious ways. What afflicts big institutions also afflicts pop culture. For instance, it has become notoriously difficult to introduce a new pop star in the music business."

Is Lanier talking about the media industry on planet earth? Surely not. Because the "hive minds" at Myspace and Last.fm have emerged exactly as solutions to the utter lameness of yesterday's blockbuster dominated music industry. Distinctly not the other way around.

Lanier has his causality fatally backwards: the hive didn't cause the blockbuster, the blockbuster caused consumers to hive.

Now, everyone's got an opinion. But that's not an economic, social, or even a cultural argument. Arguments take real thought; real insight; hard work.

But unfortunately, if you read the work these New Bourgeois thinkers produce on the topic of the "hive", it's marred in every instance by these kinds of trivial mistakes, contradictions, and errors. This isn't argument; it's sophistry.

In short, they've got plenty of opinions - but they have a surprising lack of arguments. Those opinions are, more often than not, just admissions that many of the New Bourgeoisie are trapped in ivory towers; from where, of course, it's easy to look down on, well, everything. They are really just telling us what the world looks like from the heights of an ivory tower.

But everything is less glamorous when you come down to earth.

Don't get me wrong. Critique has it's place. It's a vital part of any discussion. But it's also intellectually bankrupt to criticize something in the way the discussion has been framed lately - to frame assumptions as conclusions; to put the horse before the cart.

It's easy for people like Nick, Jaron, and Esther to opine about how the "hive mind" sucks. Fatally easy - after, all we don't expect people in ivory towers to hit the nightclubs and party with the unwashed Myspace masses.

But, for my money, real criticism takes much deeper thought than these folks are putting in. Their thinking, these days, at least in my eyes, has become a bit superficial; and it shows, because, their insights are exactly and deeply wrong.

Here's a very simple example.

The fundamental question guys like Nick Carr, Jaron Lanier, etc keep asking (and answering the same way, no less), like a broken record, is fatally flawed. It is the wrong question. Answering it just sets the stage for an empty debate.

To ask whether the hive is dumber or smarter than the smartest person in society - Einstein, Stephen Hawking, Dubya, Nick Carr, Esther Dyson, Jaron Lanier - is a completely meaningless question. No rational thinker would waste a second of their time asking it.

The reason is simple: that outcome is socially irrelevant. The hive may be dumber than Stephen Hawking - so what? It doesn't offer much insight to say that, because almost no one has access to the time, energy, or brainpower of Stephen Hawking. We still don't know if society wins or loses.

The real question this school of thought should be asking is: is the hive, on average, smarter than the (average) individual?

Of course, they don't want to ask this question. Why? Because, in many cases, on average, the hive is very much smarter than the individual. Unfortunate, perhaps, but true.

Don't believe it? Think about a world without financial markets for a second, and you will instantly understand what I'm saying.

And this idea - the Hayekian notion of the spontaneous, self-organizing order of exchange in markets - was perhaps the greatest breakthrough of 20th century economics. This is what we're really talking about when we discuss the "hive mind".

But it's very (very) important to understand this enormously powerful idea. In fact, the anti-hive crew's biggest mistake (of all their manifold and egregiously silly arguments) is that they don't understand what markets really are.

Hayek's great insight wasn't simply that "markets are efficient". It was far more subtle, and that was why it was so momentous. It was that markets - the hive mind, if you like - work despite the fact that individuals "suck" - despite the fact that individuals have less than perfect information, and they make silly choices. The genius of markets is that they can create not just order, but often, efficiency from decentralized, local anarchy.

Markets, networks, communities, 2.0ness in general works, in other words, exactly despite the fact that the masses may be very, very dumb. And this is why the "hive" is such a boon to consumers; why consumers are connecting en masse.

The "hive" might offend the rarefied sensibilities of guys like Nick and Jaron, sure. But why on earth should we care? After all, they're not even bothering to ask the questions that really matter, and so they can't answer, with any explanatory or predictive power, what the effects of the "hive" of connected consumption will be from economic, social, or cultural points of view.

In short, there are certainly critiques of markets, networks, and communities you should read. But the critiques of the New Bourgeoisie aren't on that list. They have no real weight or depth.

Sartre once said "hell is other people".

It was brilliant when he said it. But when the New Bourgeoisie have to spend thousands of words trying to convincing us it must be true, with little originality or insight to offer (let alone anything resembling a rigorous argument), it just sounds like another tired, stale cliche.

-- umair // 6:12 PM // 32 comments


Comments:

I was kicking myself when I read the quote from Jaron on Scripting.com today. Years ago when I was thinking of a blog name I wanted to use: Every Dollar is a Vote - Fascism revisited.

Great response - lightning fast. I'm not worthy. And quoting Hayek. I can't stop reading his "Constitution of Liberty" I don't think politicians, certainly not George Bush or Steven Harper know the history of the "Rule of Law".
// Blogger Ian // 8:02 PM
 

the great thing about hive vis a vis Sartre is that the hive isn't "other people", it's you. Nick Carr, Esther Dyson, me, you, we are all the hive. And the hive's personality, which is where the "Hell" lies, is ever changing, and unlike an individual, can be influenced and changed by my participation.

The next great thinkers will be part of and not apart from, the hive.
// Anonymous Ted // 8:20 PM
 

Couldn't agree more with Ian, and yourself. I'm glad you've come out and shown Lanier to be making the wrong argument and basically be out of touch with the environment he is aiming to critique.
// Anonymous John Middleton // 8:22 PM
 

Umair,

Your argument here wanders all over the place and as a result is largely incoherent. Let me try to be concise: There are things that markets are very good at, like setting prices for commodities, because markets filter out individual biases. And then there are things that markets are not very good at, like writing books or encyclopedia entries, or editing newspapers or magazines, or taking pictures, or making movies. The "hive mind" crowd confuses the two, as you seem to do here in this post. (Lanier, by contrast, spends a lot of time painstakingly distinguishing between the two.)

The question you ask - "Is the hive, on average, smarter than the (average) individual" - is the right question to ask if you need to establish a concrete assessment of a highly uncertain future event, in the process of, say, setting the current price of a stock. But it's a meaningless question when applied to creative work. In the case of creative work, you want to ask this question: "Will the hive, on average, create something that's better than a more-than-averagely-talented individual will create?" And the answer you will come to, as long as you don't fall victim to fuzzy collective-intelligence claptrap, is "No." And this isn't a question of elitism - the more-than-averagely-talented individual may be anyone, anywhere - but of merit.

Here's the danger, as I've discussed elsewhere: By creating mediocre products for free, the hive (or the crowd or the collective or whatever you want to call it) undermines the economic incentives for creating something that's better than mediocre. You may think that would be wonderful; I think it would be a disaster. I'll let others sort out which of us is guilty of superficial thinking.

Best regards,

Nick
// Anonymous Nick Carr // 9:06 PM
 

Nick,

> And then there are things that markets are not very good at, like writing books or encyclopedia entries, or editing newspapers or magazines, or taking pictures, or making movies.

Agreed, but it's not the market that's writing the book, it's still the individual. The difference with Web 2.0 is the ability to create for the sake of creation, and allowing the market ("hive mind") to retroactively assign value dependent on quality.

This is in opposition to older models of media where funding must be sought upfront, and thus there is less market incentive to deliver quality. The goal becomes to recoup costs through demographics, rather than create breakout viral hits ("snowballs").

> By creating mediocre products for free, the hive (or the crowd or the collective or whatever you want to call it) undermines the economic incentives for creating something that's better than mediocre.

This completely misses the mark, and shows a lack of understanding of emerging media models. I suggest you read Umair's New Media Economics.

> I'll let others sort out which of us is guilty of superficial thinking.

The difference between Umair and youself, Nick, is that Umair provides solutions; not just intellectualized talking points.
// Anonymous Jordan // 9:43 PM
 

Hi Guys,

Lightning fast = concides with my hour of blogging time this week :)

Thx for the comments.

Hi Nick,

My argument is very simple - the assumption that markets aren't good at pricing some things is exactly that; just an assumption, which is, unfortunately, being recast as a conclusion.

In fact, I think the evidence contradicts this; that Wikipedia (etc) is an existence proof that markets can work reasonably well at pricing a broad range of things.

Second, you are essentially arguing that peer production causes a market failure - by assuming that peers can only produce the "mediocre", and that the mediocre is a public good.

Again, your assumption isn't borne out by evidence. I don't think the Threadless crowd thinks their t-shirts are mediocre; rather, they are cooler than what they can get at the mall, in the gap, etc.

But let's assume that peers *can* only produce the mediocre, to try out some other arguments. Even if that's true, we need numerous other conditions for market failure. The simplest condition is probably that goods are perfectly public.

But perfectly public goods are nonrival in consumption - I can't stop you from consuming them.

Most peer communities don't meet that criterion: I can stop you from consuming a Wikipedia entry by editing it.

Put another way, there is an incentive to invest in peer production, because there is an incentive for quality; hence, there shouldn't be a market failure. In fact, what we should see is arbitrage - which is exactly what's happening now.

So I don't think there is a market failure here. I think the market should be able to decide - and is deciding. If peer production "sucks" in the strong Lanier sense, Threadless etc die. Incentives for "creativity" are restored.

But again, evidence; the growing volume of T-shirts at Threadless, for example, tell us that peer production can and does create very real value.

But let's even you assume you are totally right - peer production kills the creative.

At the end of the day, there is a very simple and nice answer to this (imaginary) problem - a Ministry of Culture doling out grants to those whom it thinks are "creative".

Thx for the comment - it was a good one :)
// Blogger umair // 9:45 PM
 

Umair as usual equates mass with quality. He ignores basic statistics - that some 2.5% of people are really, really talented at any aribtrary subject, and that another 2.5% are really, really bad at the same subject - and that there is a large central section in the normal distribution that will not be Einstein, Hawking or Hayek, even if they collaborate for eternity, because they do have the spark of genius: instead, they have the mark of mediocrity, by definition. That is why precisely 2.5% of blogs get 80% of all attention (evidence: you can look it up).

This also lies at the hear of my recent arguments with Hack on content, and not attention, being the unique resource. A huge furball of mediocre content is useless; people seek talent, and talent is rare, hard to replicate, and increasing hard to find amongst the noise...
// Anonymous Web2.0Sceptic // 10:16 PM
 

Here's the danger, as I've discussed elsewhere: By creating mediocre products for free, the hive (or the crowd or the collective or whatever you want to call it) undermines the economic incentives for creating something that's better than mediocre.

Nick Carr a supply sider?

Aren't we all Keynesians yet? The market's demand for "mediocre" products undermines the incentives for creating something better. Demand for alternatives--whether free and mediocre or genuis and rich--undermines incumbents.

By way of Umair's example:

I don't think the Threadless crowd thinks their t-shirts are mediocre; rather, they are cooler than what they can get at the mall, in the gap, etc.
// Blogger Anderson // 10:55 PM
 

I don't think the Threadless crowd thinks their t-shirts are mediocre; rather, they are cooler than what they can get at the mall, in the gap, etc.

Bad example.

Those t-shirts are

a) created by individuals and
b) selected (voted) as being the cream - top 2.5% - of the crop.

Where does the mediocre fit into this? It doesn't. The mediocre shirts - and the individuals who created them - get left behind in the rush to own a quality shirt designed by a talented individual.

As it was, so shall it ever by. Those who ignore Graham will perish as the market moves from short-term voting to long-term weighing.
// Anonymous Web2.0Sceptic // 12:24 AM
 

Speaking of T-Shirts this is the first one I've wanted to buy and I think is actually on topic.
http://factoryjoe.com/blog/2006/05/29/whats-your-community-model/Discuss all you want - this is a great discussion by the way - the masses are self educating and self producing. Eventually it will enter education and politics. Basic Hindu warring god stuff. Hopefully the masses will not turn fascistic but rather read the April Harpers:
The Spirit of Disobedience
An invitation to resistance
by Curtis White (who hopes for a Thoreau style resistance)
// Blogger Ian // 12:39 AM
 

Umair/Nick,

You guys are talking past each other -- you're talking about two discrete phenomena, exemplified by Wikipedia and Threadless.

With Wikipedia, the "hive" (to go with Umair's term) is creating the "content" as a collaborative effort. Multiple people are writing and changing each entry. It's NOT about the hive acting as a market to JUDGE or PRICE the value of each entry.

In contrast, the "content" of Threadless is the product of INDIVIDUALS -- Threadless harnesses the hive, which is acting as a market, to sort through the sea of submissions to identify marketable products.

Umair, to use Threadless as an example, it's NOT about a group collaborating to CREATE a T-Shirt design -- it's about a group VALUING t-shirt designs created by INDIVIDUALS. It is very much about elevating and valuing the product of talented individuals. It's opened and made more efficient the market for identifying cool T-Shirt designs -- but it has not lowered the bar for what constitutes a cool T-Shirt design.

The question about whether hives can VALUE creative efforts is COMPLETELY SEPARATE from the question of whether hives can COLLABORATE in generating creative output.

Umair, I think you were largely as guilty as Nick in failing to use multiple examples to clarify exactly what it is you're talking about.

Cheers,
Scott
// Anonymous Scott Karp // 4:33 AM
 

Hey Scott,

I think your comment is extremely interesting.

I don't agree that Wikipedia isn't basically valuing things, but I think your distinction is quite valuable.

Would discuss more but can't do justice to it here.

Thx for the comment.

That's the point I was trying to make

Hey Sceptic,

This is a semi-public space for discussion. Sometimes even trolling is part of a good discussion.

What this is not is a a trashbin for your personal attacks.

I warned you before, now I have to ban you. Possibly at least until your tell us your name, background, etc, but I will reserve judgment.
// Blogger umair // 2:26 PM
 

Scott,

Yes, I agree. We're talking about two different things. "Threadless" is just an efficient way for t-shirt designers to distribute and market their goods. That's great. And if buyers can rate those t-shirts so as to filter out the long tail of crap for other buyers, that's great, too.

That has nothing to do with the collective, de-personalized creation of goods that Lanier was talking about and that I've been talking about.

Nick
// Anonymous Nick Carr // 2:33 PM
 

funny that there's not a single mention of the elephant in the bee's hive--Linux
// Anonymous spencer reiss // 5:19 PM
 

Spencer,

Don't you mean the penguin in the beehive? :)
// Anonymous Pete Cashmore // 5:52 PM
 

perhaps penguin X elephant=sacred cow?
// Anonymous Spencer Reiss // 7:24 PM
 

I suggest reading The Success of Open Source for an explanation of the Linux/OSS phenomena. OSS projects usually have a small core of developers guiding the project and evaluating and selecting contriubtions. Closer to a representative democracy than mob rule.
// Blogger Alex Farran // 12:29 PM
 

Umair,

you banned me? You banned user generated edge content? How very 1.0 of you.

I do not think in this day and age that my name is relevant; the quality of my argument is enough. I seek no glory, and your lack of non-ad hominem response to my quite simple points speaks volumes to many of those watching.

Suffice to know that I have studied enough under some of the greatest minds in the world to know that your theories are idiotic snake oil, and that there is areason you are trying to get a job in ibanking.
// Anonymous Web2..0Sceptic // 10:17 PM
 

My views are here

http://rajatgupta.wordpress.com/2006/06/03/peer-production-boon-or-bane/
// Blogger rajAT // 9:11 AM
 

Sceptic,

Sigh.

Let's take a look at your arguments. I think most readers here can see that they're a bit trivial, but let's go through them one last time:

1) Talent follows a normal/scale free/whatever distribution.

Sure, but that's irrelevant. We're talking about people building on what others can do - minimizing the costs of coordinating that talent; or we're talking about being able to find the talent without paying search costs. See below.

2) Threadless as "bad example".

You agree Threadless produces (incentives for) quality. This is obviously exactly my point - it's a "hive mind" that "works" instead of creating mediocre crap in the Carr/Lanier sense.

3) Banning fools is the essence of "2.0". See Wikipedia or NYSE.

OK. Now, back to the real point.

I was interested in your background so I could figure out how to explain things to you, because you don't seem to have the intuitive basic grasp of, say, media/strategy/etc most readers have.

But I'm really not interested anymore dude.

Thx for the comment (you're still banned).
// Blogger umair // 1:12 PM
 

Umair,

LOL

Most of your readers have at best amateur skills with which to judge your theories as being worthless; whereas my judgement has the weight of understanding the detail behind the arguments you make at a basic level. Oh yes - your classmates are watching...

1) Rubbish. The point I made, and which you have failed so far to grasp, is that talent is the scarce resource, not attention. And it always has been. That is why big names command big fees.

2) Equally rubbish; The talent at Threadless is not a "hive mind", it a small core of talent individuals seeking recognition from a large number fo other individuals. The attention of those watching flocks to buy the output of the unique resource - the talent. You, in contrast, believe (incomprehensibly) that attention is scarce. Look at the head of any long tail and tell me this: Where is your evidence?

3) Oh really? So, in Web 2.0, the hive mind does not in fact decide - but the Editor? Sounds so very familiar....

Honestly Umair, you re-cycle your MBA speak and puff it up like no-one else has every sat in those classes. Get over yourself. Many more of your classmates are watching...
// Anonymous Weeeb20Skeptic // 5:51 PM
 

Umair,

LOL

Most of your readers have at best amateur skills with which to judge your theories as being worthless; whereas my judgement has the weight of understanding the detail behind the arguments you make at a basic level. Oh yes - your classmates are watching...

1) Rubbish. The point I made, and which you have failed so far to grasp, is that talent is the scarce resource, not attention. And it always has been. That is why big names command big fees.

2) Equally rubbish; The talent at Threadless is not a "hive mind", it a small core of talent individuals seeking recognition from a large number fo other individuals. The attention of those watching flocks to buy the output of the unique resource - the talent. You, in contrast, believe (incomprehensibly) that attention is scarce. Look at the head of any long tail and tell me this: Where is your evidence?

3) Oh really? So, in Web 2.0, the hive mind does not in fact decide - but the Editor? Sounds so very familiar....

Honestly Umair, you re-cycle your MBA speak and puff it up like no-one else has every sat in those classes. Get over yourself. Many more of your classmates are watching...
// Anonymous Weeeb20Skeptic // 5:52 PM
 

Hey Skeptic,

Siiiigh.

FYI - Most of my readers are...uhh...a lil past the MBA stage.

Look. Let me take a few minutes to recast the argument.

Let's first note that talent will always be "scarce" (by definition). Your assertion is actually meaningless - the word "talent" implies (some level of) scarcity.

First, we need to get rid of that embedded assumption. So let's call "talent" content, like the rest of the world does (at least for now).

Consider a world where anyone can produce and publish anything, but consumers (or other players on the other side of the market, like advertisers) pay significant costs in finding the stuff they will derive the greatest utility from (=now).

These are the costs of allocating attention. Now, it should be intuitive that, relative to a mass media world, in this world, supply explodes, while demand on both sides of the two-sided market doesn't keep pace (because discovery is costly).

Now, as these costs of discovery - the costs of allocating attention fall - attention becomes more abundant and cheap.

When attention is allocated perfectly - when each consumer is matched with the content that matches his/her preferences - this industry is maximizing value creation.

Certainly, at this point, "talent" is scarce.

But the challenge today is finding this "talent"; matching consumers (and advertisers, etc) with the right stuff. Put another way, attention is scarce.

Your world will exist one day - but in a relatively distant future. Until we've learned how to sort through the media explosion, attention will be scarce.

Now, let's spend a second refining the argument.

Consider YouTube and MySpace. Here, we can say that "talent" is becoming scarce. The "best" videos/bands, to an extent, win the most traffic.

But they do so *because* YouTube and MySpace are learning to solve the *problem of attention scarcity*. MySpace, for example, has spent years honing a solution to attention scarcity built on the social and the cultural.

Now, because they are, the result is the Snowball Effect: this is another name for amplifying returns to creativity (or "talent").

But it's dynamic and path-dependent; it's not as simple as saying the "best" talent wins globally - because, for example, on MySpace, Snowballs surface within given microniches (Goths, emo kids, etc).

Now, we come to the crux of why you're so upset. You're ultimately confusing attention scarcity with peer production. One of the reasons peer production is important is that dominant strategies for an attention scarce world can built on it. In your words, it lets "talent" emerge, by solving the problem of attention scarcity.

Like MySpace, etc, Threadless has found a somewhat elegant way to solve the problem of attention scarcity. The "scarce" resource in this case may certainly be talent; that's exactly why Threadless is cool - because it's rediscovering strategy.

Here, I'm trying to demonstrate what we were debating before: you're thinking about the firm level (where talent may indeed be becoming scarce); but at the industry level, it is very much the case that attention is scarce. Just look at advertising numbers, dude.

Now, dude, if you wanna debate, that's fine. But the clumsy personal attacks stop here, kk?

I mean, I think it's pretty transparent at this point that you're not an LBS grad.

Look; It's your choice - I'm nice, so I keep giving you chances, but obviously, if they don't, you will soon forego the privilege of being a member of the community here.
// Blogger umair // 6:53 PM
 

Oh yah - b4 u fly off the handle again - dude, just try to be civil and I'm happy to chat.

Is it really that hard?

Otherwise, you're (so) oooooutta here.
// Blogger umair // 7:02 PM
 

This comment has been removed by a blog administrator.
// Anonymous Anonymous // 11:22 PM
 

>FYI - Most of my readers >are...uhh...a lil past the MBA >stage.

If they were, they would not be your thrall.

>Look. Let me take a few minutes >to recast the argument.

Thank you.

>Let's first note that talent will >always be "scarce" (by >definition). Your assertion is >actually meaningless - the >word "talent" implies (some level >of) scarcity.

Indeed. Precisely. The scarce resources is talent, by definition.

>First, we need to get rid of that >embedded assumption. So let's >call "talent" content, like the >rest of the world does (at least >for now).

No. Talent is not content, although I see where you go with the proxy, and for the sake of argument will run with it as follows: *some small proportion* of all content is "talent".

>Consider a world where anyone can >produce and publish anything, but >consumers (or other players on >the other side of the market, >like advertisers) pay significant >costs in finding the stuff they >will derive the greatest utility >from (=now).

All fine, excepot I think there are many tools to make such costs very cheap - the most obvious being Google, which shows you what the largest number of others else thinks is the most relevant link. Why do you think a Google search expensive?

>These are the costs of allocating >attention. Now, it should be >intuitive that, relative to a >mass media world, in this world, >supply explodes, while demand on >both sides of the two-sided >market doesn't keep pace (because >discovery is costly).

I agree with you except that the discovery is NOT costly. It happens the same way it used to happen. The fact that ADVERTISING cannot get across a message reliably is not the same thing at all.

>Now, as these costs of discovery ->the costs of allocating attention >fall - attention becomes more >abundant and cheap. When >attention is allocated perfectly ->when each consumer is matched >with the content that matches >his/her preferences - this >industry is maximizing value >creation. Certainly, at this >point, "talent" is scarce.

Right. Correct, and I think it is in the next point where you go badly wrong.

>But the challenge today is >finding this "talent"; matching >consumers (and advertisers, etc) >with the right stuff. Put another >way, attention is scarce.

I completely diaagree. Attention for ADVERTISERS is scarce; there are still plenty of hit records, plenty of hit websites, planty of new books making bestsellers lists and selling more than ever before, plenty of new movies smashing all previosu records, plenty of other hit phenomenon like oneredpaperclip going on. Millions flock to the quality content. Finding quality is as cheap as Googling it.

>Your world will exist one day - >but in a relatively distant >future. Until we've learned how >to sort through the media >explosion, attention will be >scarce.

Again I completely disagree. How many websites do you visit in one day? 1,000? 2,000? 3,000,000? Or do you visit the 20-30 you like and trust and link off from there to the quality content they recommend? You tell me: how do you sort through the media explosion? The same way kids used to find new bands - listening to tons of stuff, and then sticking with what you like.

>Consider YouTube and MySpace. >Here, we can say that "talent" is >becoming scarce. The "best" >videos/bands, to an extent, win >the most traffic.

Exactly. And where are all the others? Nowhere.

>But they do so *because* YouTube >and MySpace are learning to solve >the *problem of attention >scarcity*. MySpace, for example, >has spent years honing a solution >to attention scarcity built on >the social and the cultural.

Again, I disagree, as above, but this time you make my point - that we are already there - for me. There are plenty of internet hits happenign now, like Tila Tequila and Arctic Monkeys.

>Now, because they are, the result >is the Snowball Effect: this is >another name for amplifying >returns to creativity
>(or "talent").

Or hits AKA blockbusters...

>But it's dynamic and path->dependent; it's not as simple as >saying the "best" talent wins >globally - because, for example, >on MySpace, Snowballs surface >within given microniches (Goths, >emo kids, etc).

Who said talent had to be the best? Do you think Britany Spears or the Spice Girls were the best singers out there? No. But they were very popular. They had "talent", something cerain sections of the public wanted. Did those who listen to Pink Floyd by Spice Girls albums? Probably not. So what is new? There is nothing new here at all except that advertisers don't know where to spend their money to be effective in selling goods.

>Now, we come to the crux of why >you're so upset. You're >ultimately confusing attention >scarcity with peer production. >One of the reasons peer >production is important is that >dominant strategies for an >attention scarce world can built >on it. In your words, it >lets "talent" emerge, by solving >the problem of attention >scarcity.

No, I just think that attention is not scarce. Full stop. There are tons of examples of hits that emerge despite the cost of search - because somebody, in som micro market is allways looking for cool stuuf, and sooner or later the hits of wider interest emerge everywhere you look.

>Like MySpace, etc, Threadless has >found a somewhat elegant way to >solve the problem of attention >scarcity. The "scarce" resource >in this case may certainly be >talent; that's exactly why >Threadless is cool - because it's >rediscovering strategy.

>Here, I'm trying to demonstrate >what we were debating before: >you're thinking about the firm >level (where talent may indeed be >becoming scarce); but at the >industry level, it is very much >the case that attention is >scarce. Just look at advertising >numbers, dude.

Precisely. Look at them. Then look at the hits that have been created in the meantime with or withour advertising, and tell me why a dearth of advertising numbers == a dearth of attention. It doesn't. It just means that people are finding talent/hits elsewhere and advertisers have not been able to keep up using traditionla means. THAT is what you are solving. It is an inability in the advertising system to keep up with the change in demand. This is not an attention problem.

>I mean, I think it's pretty >transparent at this point that >you're not an LBS grad.

LOL.
// Anonymous Web2.0.0.0Sceptic // 5:28 PM
 

Dude, thanks for the comment. But I'm afraid you've wasted all your discussion time with me esp after your personal attacks.

I will let the comment stand as an example of how not to think strategically about media.

Cheers, uh.
// Blogger umair // 5:50 PM
 

>Dude, thanks for the comment. But >I'm afraid you've wasted all your >discussion time with me esp after >your personal attacks.

[shrug]

And yet you keep responding....

>I will let the comment stand as >an example of how not to think >strategically about media.

What's clear is you can't rebut those simple, direct points. Who cares that audiences are shifting, fragmenting, coalescing in new ways? Does the audience care? or the advertisers. The ad hom simply amplifies that you are thinking about the basics of this incorrectly, and selling adventurism to your clients.

We'll see who's right pretty soon. I'll bet money from my previous IPO cash pond (ocean would be hyping it) and my MBA that you'll be working for someone else within a year, because like Stowe Boyd, your clients will at some point look at the books, do some math, and then rapidly go back to basics - good old cashflow.

Adieu, "dude". Good luck to you and the other Advisory Capital crew.

Promod
// Anonymous Web2.0.0.0.0..0Sceptic // 7:14 PM
 

Dude,

Be sure to let us know how your investments do.

FYI, a quick search of the LBS directory yields zero results for anyone named "Promod" ever having been connected to the school.

Thx for the discussion.
// Blogger umair // 9:09 PM
 

Why do you delete his comments?
// Anonymous Nigel // 5:47 PM
 

Why do you delete his comments?

He has no answer to them.

LOL
// Anonymous Web2.3.4.5.6Skeptic // 5:48 PM
 

Ok, I'm jumping in here just quickly.

IMHO, Umair is generally on the mark here. The various incarnations of "skeptic" are being a bit obtuse of entertainment's sake (I'm giving the benfit of doubt here).

Regarding the 2.5% talent argument which seems to be at the heart of "skeptic's" arguments, I think a broader view is called for: true, a minority of people in any given field will have what is generally recognized as some kind of persistent "talent" that differentiates them from the rest, but the kind of marketplace that Umair is referring to can also accommodate transient talent rather well. Let's look at the Wikipedia case: I have read many entries and their corresponding discussions and seen many fascinating and worthy "small contributions" contributed by folks with a small sliver of "micro-talent" that added something of worth that I simply could not get anywhere else. I think Nick's view lacks subtly in this regard.

I personally value Wikipedia's existence highly, and would rather occupy a world with it than without it.
// Blogger rancor // 4:36 AM
 
 

Recent Tweets







    input
    portfolio
    contact

    mail.
    uhaque (dot) mba2003 (at) london (dot) edu

    skype.
    umair.haque

    atom feed

    technorati profile

    blog archives