CrowdSurfing 101

Can Too Many User Reviews Cause Brain Damage?

2009-05-27T16:43:00.000-07:00

I was recently reading an article on The Economist on the value of someone adding the 3,202nd review to Amazon about the new Harry Potter book. In interviews with consumers, many feel that it is just not worth the time, as their review will just get lost in the mix. I personally can only handle reading a handful of reviews before my head begins to hurt.

Although I am not sure about the impact of adding review number 3,203 to a Harry Potter book, Google Analytics has found that volume does make a difference. According to John McAteer, a director at Google, volume of reviews does impact transactions, “Single digits didn’t seem to move the needle at all,” says Mr McAteer. “It wasn’t enough to get people comfortable with making that purchase decision.” Seems like that magic number was more in the range of 20 reviews for a specific product to effect transactions. An eVOC Insights study reveals that 63 percent of online shoppers are more likely to buy from sites with ratings and reviews.

If you think about this for a second, it makes total sense. I mean, the reason we even read reviews in the first place is to try to understand consumer sentiment or popular opinion for the product or category in question.

Think about the last time you tried to book a hotel for your vacation. More than likely you knew generally where you wanted to stay, and you probably had some specific requirements like nice pool, close to the beach or close to shopping. From there, you probably started reading the reviews of each hotel that met your location requirements, above 3.5 stars, to try and figure out which was the best one for your special trip. After reading 15 reviews for each of the 10 hotels that you identified on Trip Advisor, and an hour later, you probably have narrowed it down to 5 possibilities. From here the frustration mounts as you now go to Hotels.com to see if you can find more information to help you decide. If this is inconclusive, you now seek another travel site like Expedia to see if there maybe more insightful information there. Several hours later, with no clear answer, you toss a coin and heads it is; Sheraton here we come. Did it cause brain damage? Unclear, but I would’ve surely used less curse words in the process.

The key here is that we all care about the experiences, knowledge and opinions of the general population when it comes to making purchasing decisions. But the issue with the review infrastructure available today is that we are left to try to determine popular opinion independently by reading the reviews of the masses. While reviews have shown to be a great way to help people make purchases, it is far from perfect. In this vacation hotel example, wouldn’t it have been more efficient if magically you knew that the most popular hotels were 1) Marriot, 2) Sheraton and 3) Doubletree based on the opinions of 10,000 people? From there you could read the individual reviews for those three hotels to make your final decision. If this were all magically true – how much time would this have saved you? Think about all the headaches it would have solved!!!

Now if we can only make this magic a reality.

It reminds me of days of communication; before we had email, we were relegated to snail mail and fax machines. In those days, we imagined what it would be like if we could send messages instantly to people…. now look where we are.

TheCrowd is gathering……..

Is Anyone Listening to the US Auto Market?

2009-05-08T15:55:00.000-07:00

On April 27, 2009, GM proposed a new restructuring plan in an effort to convince the US Government to give the company $11.6B in bailout versus the $5B originally agreed. GM proposed that $10B of this bailout be transferred to stock which would give the Government a 50% holding in the company. There are many other headlines in this plan, including a proposal to the United Auto Works to forgive $10B in healthcare debt in return for a 39% stake in the company. The Government is now in similar talks to save Chrysler.

Now, I am all for supporting the US auto makers, if only for nostalgia reasons to one of the countries foundational industries. However, I believe that this kind of plan simply prolongs the inevitable, which is that both companies are ultimately doomed. Unless they can start to build products that people actually want to buy!!!

In the last several years, I have personally looked at buying a Ford, GM and a Dodge SUV. In each case, I ended up buying an Acura and two Hondas. Why did I turn my back on our countrymen? Well, because as a consumer, I try and make the best purchase I can for the money that I have. Anytime I go to purchase a new car, I do extensive research to the point that it drives my wife crazy, to ensure that we make the most educated decision. The result thus far has been that Honda Corporation had a superior product for the money.

I realize that we are seeing a slump in auto sales worldwide, and in fact, several Japanese makers are also asking their government for assistance. In this case though, GM’s problems go much deeper. In 2007, GM lost the top position, as world’s largest automaker, to Toyota. Since then, they have continued their decline rapidly.

It seems to me that where GM really needs help is not just a longer “lifeline” but rather a new “lifestyle”. The reason Toyota was able to overtake GM was because they understood the customer better and built better products. The bottom line is that they listened to the crowd, and the crowd spoke with its wallet.

As hard as it may be, I think that GM needs some tough love first, before the Government provides any assistance. The company has been carrying floundering brands such as Pontiac and Buick for several years and is just now realizing that it might be time to shed dead weight. Just as the wisdom of the crowd has had its say on GM by not buying its products, GM must now listen to this same wisdom and figure out how to build products that people want to purchase.

Hold on my little GM, help is on the way. TheCrowd is gathering……..

Does Time Heal Wounds… From a President?

2009-04-30T11:19:00.000-07:00

This month, we have caught a few glimpses of our old boy, George W. Bush. Starting with the opening pitch for the Texas Rangers, then his first public speech in Calgary, and then a meeting in China for the Boao forum, George W. has been busy. Although I admittedly voted for him for his first term, I did not vote for him second term; hence I spent his final four years disliking him and his policies. The country agreed with my opinion, as his exiting approval rating in January 2009 was 34%. That was on the rise, from the 29% he was averaging during several months of his presidency.

In watching him the last few weeks, I kind of liked him again. Not as an ex-president, but just as a guy who I would like to grab a beer with (although he claims not to drink anymore). I started to remember some of the good times with ol’ Georgie, like when the economy was strong in 2003 and how after September 11th, the country as a whole was pretty safe. Let’s not get in an argument about who should get kudos for these things, in this case, because it is really irrelevant. The point is – I started to not hate him as a much.

Several presidents have left office with low approval ratings, such as Harry Truman’s 34% approval, Richard Nixon’s 24%, and Jimmy Carter’s 34%. Now, for me, Harry Truman was a great man and President ending WWII. According to Wikipedia, “Truman has been consistently ranked by scholars as one of the greatest U.S. Presidents.” As for Jimmy Carter, he may not have been a great president while in office, but he has since become a national hero and often called upon by world leaders as the negotiator of diplomacy. I do not know this for sure (yet), but I am guessing that if we took an approval rating of Jimmy Carter’s presidency today he would score much higher than 34%.

The truth of the matter, wisdom does change over time as does popular opinion. Now, I am not a fortuneteller because if I was, I would have accepted that Director of Sales job at Nvidia back in 1995 (hello dummy). But the way we view Bush in three years from now will be different than how we view him today, or how we viewed him 100 days ago.

Similarly with popular opinion, people change their mind, and hence wisdom changes. One of the biggest challenges with market research today is it is difficult to accurately attain accurate consumer sentiment real time. This may be a key contributor as to why 85% to 90% of all products developed ultimately fail in the market.

But those winds are changing, and TheCrowd is gathering…..

Can Fame Come For Us Normal People?

2009-04-22T06:55:00.000-07:00

We all have heard about Ashton Kutcher’s challenge to Larry King, a race to be the first person to hit 1M followers on Twitter. Kutcher claims that he didn’t think a single person (Kutcher) could possibly have a greater impact on the public than an entire media network, so he decided to try it. This challenge did have its incentives attached. In addition to the promise of donations to charities, Kutcher promised to ding-dong-ditch Ted Turner’s house if he won. Kutcher is already a very popular figure in the world of media, but what he did, in effect, was ask for the wisdom of the crowd to determine the level of his popularity versus that of Larry King. The crowd spoke, and Kutcher now has 1.3M to CNN’s 1.1M followers on Twitter.

This is not a one off phenomena, and this practice is becoming more and more popular. Recently, there was a report that several radio and lower-tier TV personalities have been using Twitter to create and grow their following, to impress their superiors in an effort to increase their value. In one case, a radio personality was able to leverage their increased following and fame on Twitter to renew their contract. This is, in effect, really crowdsourcing fame and using the wisdom of the crowd to prove their popularity.

This is not to say that these personalities were not already popular in their own right, as I am sure they are. However, what these people have done by utilizing Twitter is create their own mini American Idol, which is another great example of crowdsourcing in media. The beauty of tools like Twitter is that it levels the playing field, allowing the crowd to determine who is the most famous, most popular and most liked. In the case of Twitter, the general public speaks or votes by choosing to follow certain personalities or individuals. If for example, Ashton Kutcher challenged me to a race, I would most likely not stand a chance. Much as it is hard to admit!!

With that said, if I worked full time on my Twitter status, I could dramatically increase my followers, from the 278 that I currently have to a number much greater. In fact, several people have done just that. I am following a woman on Twitter with the handle, @ijustine, who has 475,000 users. However, today the crowd has spoken, and they choose @ijustine over @jbennette.

In fact, the crowd is speaking everywhere – but how do we get a hold of it for more practical uses?

TheCrowd is gathering……..

Is One Opinion Enough to Land an Airplane?

2009-04-15T11:41:00.000-07:00

This past Sunday, the pilot of a 6-passenger turbo prop plane was taking off from Marco Island Florida heading to Mississippi and died during ascent. The plane was carrying four passengers: Doug White, his wife and two teenage daughters. Shortly after take off, White noticed that the pilot had passed out. The plane was on autopilot so there was no immediate danger. White tried for 30 minutes to revive the pilot to no avail. White, a licensed pilot, had 150 hours experience on smaller Cessna aircraft but had never flown a plane as big as the King Air plane.

White radioed air traffic control to explain the problem and in response one of the controllers called a friend, Kari Sorenson, who had King Air flight experience. The air traffic controller relayed the events in the plane to Kari and in return Kari gave step-by-step instructions back to White through the controller. White landed the plane safely and everyone (except for the deceased pilot) was ok all due to the expertise of Sorenson and the resourcefulness of the air traffic controller.

In this case, one opinion or expert was plenty to save the day. Who knows what would have happened if air traffic control was not able to find a King Air expert? What this air traffic controller did was leverage his network to find an expert to contribute their experiences to solve a problem. Sorenson was willing to help because his friend asked. This is a type of crowdsourcing.

There are similar problems that we all run into whereby one opinion is plenty to solve a problem. For instance, if my car broke down on the side of the road, the expertise of my mechanic would be plenty to solve the problem assuming I had one and knew had to get a hold of him. We are starting to see solutions hit the market that can solve this exact problem of connecting experts with those who have a problem in that exact segment. Although this level of expertise might not be needed on regular basis, these solutions will serve to be extremely helpful.

In our daily lives, there are probably far more issues that we run into whereby the aggregated opinions of a larger pool of people matters more. The dilemma at hand often mandates the size and demographic of that pool desired to provide an opinion. For instance, if I want to know the cheapest place to buy gas in Los Gatos, I would only care about the opinions of 30,000 people who live here. At the same time, if I wanted to know the single best crossover SUV less than thirty thousand dollars, then the opinions of 500,000 people would be more appropriate. If I wanted to know the single most popular movie currently playing in theaters then 1,000,000 opinions of people over thirty is probably more appropriate.

You might say, “Gosh, it would be great to have that kind of power.” To which I would say TheCrowd is gathering………….(April 30th)

Can Crowds Solve Crime?

2009-04-08T11:10:00.000-07:00

In the world of solving crime and tracking down criminals, the process of police work today is very secretive for the most part. Traditionally, when an officer is in pursuit of evidence to track down or identify a suspect, this process is done under the cloak. We have all seen the movies of the solo officer working in a vacuum to find an assailant.

Technology is beginning to change this process, as the public continues to show its support in helping our crime fighters. One of the most effective methods today of involving the public to solve crime is the AmberAlert, for child abductions. When abductions are reported, the incident immediately posts on all active freeway traffic signs, the Emergency Broadcast network, plus text messages and e-mails to subscribers (I just subscribed myself). The website boasts several success stories using this powerful tool, including the following.

In July 2007, three children, ages 14 days, 9 years and 11 years, were forced out of their mother’s car by an acquaintance in Meridian, Idaho. Within one hour of an AmberAlert being issued by the AAWP, an officer in Ontario, Oregon located the vehicle used in the abduction, and the children were returned safely. Because both Idaho and Oregon are members of the AAWP, the alert went out to law enforcement in both states and doubled the chances that the children would be recovered.

In Australia, a program called Crime Stoppers has gone a step further in institutionalizing the use of crowdsourcing to solve crime. On CrimeStoppers.com, the police post wanted criminals and unsolved crime incidents to solicit the help of the crowd. The program has been well received, and it has seen some substantial growth:

“The 2007-08 financial year results for your program have seen continued growth in all areas. We believe this growth stems from increased community recognition and participation.”

The following figures depict some of that growth

- 43145 calls (up from 34572)

- 12770 Information reports sent for Investigation (up from 11772)

- 1048 arrests (up from 1011)

- More than 19 million website hits (up from 16 million)

The truth of the matter is that the crowd is here to help, and given the right tools and opportunities, much can be accomplished be enabling this level of participation. This is not to say that the world of public safety and crime solving should be on public display. There must be some lines drawn for sure, as there are reasons to keep things secret. But as this data suggests, there are plenty of reasons to increase the involvement of crowds.

The Crowd is gathering………

Is a Twitter and Google Marriage Wise?

2009-04-03T09:58:00.000-07:00

According to TechCrunch this morning, Twitter is in talks to be purchased by Google. The last valuation of Twitter a few weeks ago was ~$250M, so the purchase price would have to be somewhere north of that. I can see how this makes sense for Google, but is this really the wise choice for Twitter? The answer to that question is really dependent on whether or not Twitter has identified a sure bet business model; my hunch is that the answer to that question is a resounding NO.

Now I use Twitter most every day. I see it as a value to my life, but would I pay for it? No. Are there plenty of ways for Twitter to make money? Yes. However, they need to move fast, as the technological barrier to entry is not very big. The real barrier to entry is the user base that they have accumulated, which grew 33% in February to 10M unique subscribers.

Part of the reason for the high level of monthly user adoption to this new communication mechanism is the grass roots feel of the application. YouTube mirrored this same grass roots feel and growth rate back in 2006, when Google purchased them. At the time Google purchased YouTube, everyone thought that profitability was surely around the corner. However, in August of 2008, Google disclosed that YouTube was still not profitable. Hmmm.

So that brings us back to the original question. Regarding the wisdom of this transaction, you have to segment which crowd you are asking. If you are asking for the collective wisdom of the Twitter users, I am guessing that the answer would be that Twitter should remain independent. At the same time, if you were to gather the collective wisdom of the Twitter and Google employees, I believe that the answer would be, “run, don’t walk to complete this deal”.

I have to say that I would agree with both sides here. I personally never use YouTube anymore, which was not a conscious decision but just kind of happened that way. Similarly, I think that once this transaction is complete, Twitter may lose a lot of its luster. However, I think Twitter should not consider hesitating whatsoever.

It is my humble belief that Twitter is far away from anything that resembles profitability. I also believe that the days of large valuations for unprofitable companies are coming to an end. With the down turn in the economy, I think that the patience of the shareholders, to take the massive dilution required to acquire these unprofitable companies, is waning. I think what we are seeing is an economy that goes back to basics, with more realistic valuations based on fundamentals. It is quite possible that some companies, like Twitter, will still be able to ride the hype. On the other hand, those opportunities are becoming far and few between.

So, who is right in my imaginary scenarios outlined here? As a more recent user of Twitter, I would have to agree with the majority of users. Keep Twitter independent! At the same time, as a capitalist, I would have to agree with the majority of the Twitter employees, “Do the deal, do the deal”.

Getting to the point, the wisdom of the “entire” crowd is valuable but sometimes the granularity of the crowd’s wisdom can be important. Now if only we could really access it.

The Crowd is gathering…….

Professor Uses Wisdom of Crowds to Engage Students

2009-03-30T13:38:00.000-07:00

Not sure about you, but I personally found astronomy a bit challenging back in my college days. For me it wasn’t challenging because it was a hard topic necessarily; mostly because it was a topic where I was not particularly interested.

I bring this up because a good friend of mine was telling me that his daughter takes an astronomy class that uses the wisdom of the crowd to keep students engaged. I have always known that crowdsourcing will play a part in the education process, both formally and informally. Using the wisdom of crowds to keep college students engaged is intriguing, to say the least.

The professor of this class created wireless voting consoles with four simple buttons labeled A, B, C, and D, placed at each seat. Periodically during the class lecture, the professor poses a question and asks the students to vote on the right answer. What they found is that “the crowd” (the students in this case) are right more than 80% of the time when polled. My friend’s daughter has found that it actually keeps the students much more engaged and interested in the topic.

This concept is very similar to “Who Wants to Be a Millionaire”, where the contestant has three different lifelines to try and determine the answer to a question. One of these lifelines is to poll the audience for their opinion to the answer; the audience is right 91% of the time. In contrast, another lifeline available to the contestant is to call a friend, a claimed “expert”, to assist with the answer of a question. In these cases, the expert is only correct 65% of the time.

Despite the possibility that the majority of these students will not move on to be astronomers, could the learning technique be a new way of teaching some subjects? Might it be sufficient in entry-level elective classes, such as astronomy, for a professor to get the “wisdom of the crowd” of a class to about 80% and not push for “experts”?

As I like to push my thinking outside of the box, I can’t help but wonder what the outcome would be if more classes were to engage in teaching practices embraced by this astronomy professor. Would we create more experts, if this practice of teaching was also complemented with a grading system that focused on the collective wisdom of the entire class as opposed to the traditional individual grading system?

I think that what this professor has done is really revolutionary, and it is clear to me that we have not even begun to leverage the wisdom of crowds yet.

The Crowd is gathering…….

Wisdom of Crowds Steers Coldplay’s Strategy for Viva La Vida

2009-03-24T09:54:00.000-07:00

When a band creates a new album the music label tries to guess which song should be the single that best represents that album. It is the “selected” single that the label will spend massive promotional dollars for things like a CD single, music video and radio play. This is all done as a way to promote the album, as that is where the label makes most its money. Hence the art of this process is to try and predict what the crowd will like best.

Because a music label cannot possibly afford to promote every song on the album, if they are incorrect in their prediction and they select the wrong single it can have a negative impact on the overall sales of the album. This means that the record label has wasted a lot of money and possible doomed an otherwise good album or even the entire band.

Last year Coldplay released their new highly promoted and anticipated album Viva La Vida. Their label, EMI, chose the song Violet Hill as the lead single to promote the album. In doing so, EMI created the standard promotional content and programs around the song including free early downloads for a week. Violet Hill was released on May 5 digitally, as CD single and a music video. As a way to leak more of the album out EMI then released the second single Viva La Vida on May 7 digital only. In conjunction Coldplay did an advertisement for Apple’s iTunes in May and used Viva La Vida as the song.

The interesting thing was that even after all the promotion around Violet Hill it was Viva La Vida that became the big hit as an almost overnight success. Viva La Vida quickly reached the top spot of the UK Singles Chart and Billboard Hot 100. According to Wikipedia it was “the band's first number-one single and a Transatlantic number-one. Viva la Vida was well-downloaded in the internet, becoming iTunes' second best-selling song of 2008”. The crowd spoke and with its wallet.

EMI, responding to the crowd, scrambled to appease the market by going back to make a music video and a CD single for the song Viva La Vida long after the album was released. Both were released on July 29, 2008. Arguably it was because of this change in focus to the single Viva La Vida that powered the success of the compilation becoming the worldwide best selling album of 2008 according to Wikipedia.

In a very direct way the collective wisdom forced EMI to change its strategy quickly and with that change they were able to ensure that they matched the market trends. I’ll tell you – this “wisdom of crowds” stuff is powerful!!!

The Crowd is gathering……

When Will Large Media Listen to the Wisdom of the Crowds?

2009-03-18T11:58:00.000-07:00

I popped in the Ratatouille DVD the other night to watch with my kids. As we waited for the movie to begin, I saw a commercial that talks about content stealing. You’ve probably seen it - the one where loud music is playing and they draw the analogy of people stealing stuff from stores as being equivalent to accessing unauthorized digital media. As I was watching this commercial for the 100^th time, I wondered - at what point will the business models of large media companies catch up to the opportunities for distribution, based on the wisdom of the crowd?

I whole-heartedly stand behind the protection of the rights for content creators. I believe those who knowingly propagate illegal distribution of this content for their own profit should be punished. At the same time, large media is focusing on the wrong thing – we are not lacking in technology to make more video content more readily accessible. This technology has existed for many years now. In reality, large media companies have been reluctant to evolve their business models as rapidly as the technology has evolved to support that content. The biggest issue for large media companies is that they do not want to cannibalize the existing markets of terrestrial TV, box office movies, and DVDs. On top of this, these companies saw what happened to the music industry with the Napster epidemic - I’m empathetic to this concern and I get it.

On the other hand if there was ever a time to evolve – that time is NOW. If we were to take the pulse of the wisdom of the crowd on the topic of easier access to more legal video content with reasonable business models, I am 100% sure that the result would be overwhelmingly positive. I am not saying that there is an easy way to solve this problem and I understand the complexities behind them. In my years spent working in the digital media space, I learned that it’s best to cannibalize your own market before some else does it for you. In this case, consumers are unknowingly doing that for these large media companies. In fact, the wisdom of crowd has already had its say, demonstrated by the large number of people accessing unsanctioned content regularly. People that I know who access content via things like BitTorent do so because it is easy not to save money.

Recently, RedOrbit (http://tinyurl.com/d2wgrg) published an article stating that “executives are now concerned that the recession will cause more users to view stolen shows and movies.” I find this totally preposterous. A down economy does not suddenly make everyone a thief. In fact, it is proven time and time again that in a down economy box office sales go up! According to Media By Numbers, box office revenue for 2009 is up by 17.5 percent even though ticket prices have increased. Attendance is up 16 percent, which means box office revenue increases can't be attributed to higher ticket prices. This is the biggest surge in the box office numbers in about two decades. I am not seeing an increase in arrests because people are sneaking into theaters to avoid the ticket price.

When you calculate this all up, the wisdom of crowds is saying that people are willing to pay for content - they just want it to be easy. Richard Cotton, general counsel for NBC Universal, told the New York Times, “Young people, in particular, conclude that if it’s so easy, it can’t be wrong.” I say, wrong, wrong and wrong again. The truth is that TV seems free because we pay a monthly fee and we just get everything that is there. With my Comcast service, the content that costs extra is clearly marked and I have to accept it. Most people cannot draw the difference in their minds between that experience and the Internet. I pay my monthly internet fee and I get whatever is there and when stuff is not free, it is clearly marked. Most people are NOT celebrating that they have just stolen free content from someone – they do not even think about it because they have no idea that it is stolen!

I believe that if it is easy, people will do it, which includes both access and business model. According to Wikipedia, as of January 2009, iTunes has sold 6 billion songs worldwide. Apple has figured out a model that is easy to access and payment that is easy to accept. Apple is now moving to a completely DRM free (DRM is the protection technology that prevents open sharing) library by the end of April 2009. That tells me that Apple is listening to the wisdom of the crowd and adapting.

Now if Steve Jobs can begin to apply that same wisdom to his stake in large media we would be all set.

The Crowd is gathering.........

(Launching coming at the end of April)

Can the “Wisdom of Crowds” Calm Economic Fears?

2009-03-13T13:26:00.000-07:00

This morning, President Obama’s top economic advisor, Lawrence Summers talked about the “excess of fear” among Americans about the economy. Summers, the director of the National Economic Council, went on to say that "fear begets fear” and that "is the paradox at the heart of the financial crisis.” I find this particularly interesting as I see crowds turn into mobs with fear eating away at our lives.

My wife said other day that it seems like the whole world is depressed right now. Her observation was based on the fact that large media is focused negatively on economic turmoil. I realize that we are not in a growth period and that things are not great economically. At the same time, I cannot help but wonder if Mr. Summers has a point - that we as a community are pursuing a self-fulfilling prophecy.

Several years ago, I was on the 6:30AM commuter flight from San Jose to LAX on my way to see a customer. Immediately after take off, the pilot came on the loud speaker and explained that we had a collision with a large bird. The pilot said that although he did not see anything wrong with any of the cockpit instruments, it was better to be safe than sorry. He told us that we were returning to the airport to check it out. Being that this was the first flight in the morning, most people were still half asleep and calm. About 5 minutes into our journey back to the airport, a woman two seats in front of me started to make an odd yelping sound. When the flight attendant went to check on this woman’s well being, the woman yelled out that she did not want to die. The flight attendant told her that this was a routine procedure but the woman did not hear a word she said. As the woman was sobbing, all she could say was “my sister died on an airplane and I do not want to die”.

At this point, everyone became a bit uneasy and the chatter among the other passengers got noticeably louder and more excited. I have to admit that I suddenly felt a bit uneasy as well. As it turned out, we got back to the airport safely and there was nothing wrong with the airplane whatsoever. At this point, I was done with flying for the day and I called the customer to say I was not coming.

The point of this story is that one person changed the whole temperament of the crowd in mere seconds. Mr. Summers insists that "what we need today is more optimism and more confidence." I wonder what the result would be if we could take the “wisdom of the crowd” within the entire country on the feeling of the economy. I know that certain places like Detroit and the financial districts of San Francisco and New York would not be very upbeat, but what about other places in the country? The key with the wisdom of crowds is to capture the opinions of a large diverse group and give everyone in that group the same vote weighting. Unfortunately, large media lets negativity have a much larger vote than positivity and hence they are analogous to that woman on my flight while US citizens are the passengers.

Again, I am not saying that things are rosy, but I do look forward to the day when we can truly take the wisdom of the crowd on topics like the economy. By doing so, we might be able to fulfill Mr. Summer’s plea for optimism and confidence.

The Crowd is gathering…………

(Thanks again to my editor Julia who makes me look smart!!)

Crowdsourcing a New Home

2009-03-10T09:54:00.000-07:00

Late this past Saturday afternoon, we had just returned from a family bike ride on a very pleasant day. While I was putting the bikes away, a nice couple passed by and cheerfully said hello as they continued their stroll. When they were almost past my house I could hear them talking amongst themselves. Suddenly they turned and said, “Excuse us sir, but we are looking at buying a house up the street and we were just wondering if you like the neighborhood?” They explained that they were not from the area so anything I could tell them would be helpful; we will call them Ted and Sue. As someone who has been burned in a real estate transaction, I was more than happy to give Ted and Sue my opinion.

Although Ted and Sue had probably already made up their minds on purchasing this new home, polling a few people on the street most likely put their minds at ease. The process Ted and Sue undertook in researching their new home was prudent albeit limited and time consuming. They had looked at five or six homes that day and when they found one they liked they walked around the neighborhood to get a feel for the area. Then, they saw someone who looked approachable and figured they would ask some questions.

In this process, Ted and Sue were reliant on the opinions of the few people that might have been outside in their yard at that exact time. While our street and neighborhood is a great place to live, they could have easily ran into someone who just had a bad day and as a result might not have gotten a good understanding of the area. Worse, there could have been no one outside at all and they would have gotten zero feedback. In this case, Ted and Sue would have had to make a $900K purchase without any neighbor data points, which is how 99% of the country makes their decision on a new home today. In reality, the intangibles of a neighborhood like culture, ages of the existing residents, daily traffic conditions all can make or break your desire to live there. With the exclusion of the information from the buyer’s real estate agent, the process of buying a home is almost entirely in a vacuum.

There are a few websites that do allow people to write reviews and ask questions. The problem with this is that users are back to the same situation that Ted and Sue found themselves: reliant on the few who have taken the time to write something. This does not come close to a crowdsourcing solution where the collective wisdom of the masses contributed.

The good news is that all of this data does exist, if only in our minds. In the example of Ted and Sue, they were totally reliant on one opinion, which may or may not have been helpful or representative of the real environment. What Ted and Sue really needed was to crowdsource this decision to see what 500 people thought about our neighborhood. With this information they could then compare wisdom of crowds for our neighborhood against the same for the other neighborhoods they had been considering. From there the individual opinions of the few chance encounters on the street could complete the picture for them as opposed to being the entire picture. Just imagine the possibilities.

The Crowd is gathering……………

The Crowd Starts to Expose

2009-03-06T07:45:00.000-08:00

Ok ok ok, so I have received many questions about what the heck we are really doing here at The Crowd. Is it a blog? Is it an application? Is it going to be fun? Is it for me to use? When will it come? Will I like it?

Well, I am glad that the mystery is working…our goal is to build up the mystique behind it. Why? Because that is what stealth mode companies do. This is done to drive some hype around the idea so that when it becomes publicly available, everyone rushes to use it.

This blog is really meant to provide insight into the way we see the world. Although our mission is simple, the foundation is abstract. The concept that we base our whole vision on is that the collective wisdom of many is more intelligent than a smart few. If you were to take a room of 1000 people and combine that room with a three- foot high by one-foot wide jar of jellybeans and ask everyone in the room to guess the number of jelly beans in the jar, the mean of those guesses would be very precise, give or take a few.

Our mission is to “harness the collective wisdom of the world and make is accessible to everyone”. Sounds ambitious, but we are confident that we have figured it out. The key to The Crowd is that it is built by the people for the people and we are simply facilitators. This means that we are building consumer applications that will enable you, the consumer, to contribute and access this wisdom. The Crowd will be accessible in the places where you spend most of your time online; The Crowd will be within the "crowds".

Is this as revolutionary as the Wright Brother’s invention of a flying vehicle? Arguably not. Could we have figured out for the Wright Brothers if there was a market for such a vehicle? Absolutely!

I realize that I have not answered all the questions again, but that is the goal: create some mystery and hype around the product so that at launch people rush to use it. The Crowd’s public launch is at the end of April so everyone will soon know what exactly is going on. Some time before that we will invite a few to check it out first to ensure that we have built something that is mostly bug free. If you are interested in an early peek – become a follower of this blog. Either way, keep reading because we have SO much more to talk about!

(Thanks to my editor Julia - you're the best!)

Cell Phone Usage Up 4X From 2002 – Good For Collective Wisdom

2009-03-02T14:37:00.000-08:00

Back in 1989, I was a very young man employed as a project manager at a PC company called Emerson Technology. At that time, cell phones were rare but were growing in popularity among executives. Because of my job, I often had a cell phone at my disposal and people used to stare at me in disbelief that a guy as young as me would be talking on a cell phone.

This morning, AP reported that now 6 in 10 people in the world have a cell phone and the subscriber base has grown from 1B in 2002 to 4.1B at the end of 2008 (http://tinyurl.com/blmege). Surprisingly, fixed or LAN line usage only increased from 1B to 1.27B during that same time period. Internet usage is only at 23% of the world’s population.

In our history, the greatest technologies invented have been related to transportation, energy and communication. In reality, both transportation and energy inherently powered better communication. Think what the combustible engine and the airplane both have done for business. For many people who live in third world countries, this new level of communication means new power: power to call the doctor when their child is sick, power to call a neighbor for a ride to the local village, power to call a relative and ask to borrow money. More importantly, this gives them the power to have their “say” in the world.

Each person in the world has something to contribute in some way, shape, or form; whether it’s an experience, opinion, vision or idea. Without proper communication systems, the rest of the world misses out on these valuable treasures. With this new adoption rate of communication technology, we are now able to begin to harness this information as a collective wisdom. If information is power and communication is the conduit to that power, I see this increase in a “connected” world as one of our most valuable and powerful tools. Once this collective wisdom has been harnessed and made accessible, this tool can be applied to almost an infinite amount of problems and opportunities alike.

The Crowd is gathering………….

(The Crowd launches at the end of April 2009)

Collective Wisdom, Michael Vick and Evolution

2009-02-27T10:11:00.000-08:00

With Michael Vick’s early release from jail, he will resurface to the headlines of the sports pages in the coming months. I predict that the public will renew debates about his return to professional football. Those against his return will be a mix: animal rights activists; those who are not football fans but have an ethical problem with the whole ordeal; and football fans that are just done with him. Those that are for his return will be fans of teams struggling that could really use a good quarterback like Vick or those that do not have a problem with his past. Regardless, most will take one side or the other. If you took the wisdom of the crowd on the topic at this point, the large majority would probably say that he should not return.

When a team finally does pick him up, as one surely will, new debates will emerge that will argue the moral standards of the NFL. People will be outraged that one of our national past times would allow someone back into the elite league after allowing so many innocent animals to be slaughtered. I predict that once the decision has been made and the deal is done, many people will be swayed to the middle ground. Those still arguing the case will be the passionate on either side. Those who did not have a strong opinion but are football fans will separate his past with his ability. Those who know very little about football will simply forget about it altogether. It is my guess that if you took the wisdom of the crowd at this point the result would be that the large majority would say that Vick should return.

When and if Vick wins a Super Bowl, few will even remember his past. Even the most passionate objectors might stand behind him.

In my opinion, you could argue either way for Mr. Vick. I can see an argument that football is entertainment. He paid his dues so let him return. I can also see an argument on the other side, that what he did was awful and he should be banned. The truth is that the NFL is one of the largest entertainment franchises in the world and Michael Vick is a performer. This is not a church or a government office - this is football for the love of God!

Regardless of my opinion on the matter, the point I am trying to make is that “wisdom” on the same topic does evolve over time. For instance, we used to think that it was wise to put lead in our paints. Over time, we learned that lead paint actually caused all kinds of problems, including cancer. We used to think that investing in a Bernard Madoff project would be a wise move but today we know that he may not be the person you should trust with your life savings. The key with wisdom is that it is always evolving, due to a combination of things, including new data and fading memories.

Regardless of what side of the Michael Vick fence you fall on, the worlds’ wisdom of the topic will surely evolve over the next several months.

Can the Wisdom of Crowds save the San Francisco Chronicle

2009-02-25T11:00:00.000-08:00

In reading about the ultimatum the Hearst Corp has given the San Francisco Chronicle today http://tinyurl.com/dfq8s2 on the Union stranglehold, I am left to wonder how in the world Unions have continued for so long. Although I have worked for start-ups for the most part of the last 20 years I still understand why Unions began in the first place and why they once made sense.

But that was more than 80 years ago (http://tinyurl.com/dng35x) when workers needed protection. By joining forces workers were able to organize against "the man". Today things are different and when we look at the few areas where Unions still have a strong hold, like US automakers and newspapers, these industries are in deep trouble financially and they have had problems adapting and continuing their competitive edge. Even back in the days of Jimmy Hoffa, the Unions were not necessarily taking the power of the people and doing what the "crowd" thought was best. Rather, the Union leaders were using their power over their people to influence corporate treatment of employees.

Now I know change is hard and fear of the unknown can be scary, heck I am building a start-up in the worst economy the world has seen in 80 years. But in these cases where Unions are creating an environment where companies and segments are no longer competitive than it is time to rid ourselves of the ailing elements. Apparently in the Chronicles case it is the Union.

I am really curious what the result would be if we were able to take the wisdom of the crowd of Chronicle employees and give them their choice; break the Union and most can keep their job or continue with the Union and most if not all will lose their job. I realize that this is not the ultimatum posed by the Heasrt Corp but it probably should be.

Let's take the assumption that "wisdom" would prevail and the employees of the Chronicle would chose to break the Union. The Chronicle then could follow in Proctor and Gamble's footsteps and crowdsource ideas to turn the company around. Given the passion displayed in the last day about the Chronicle's fate I think that it is safe to say that we would see a tremendous influx of ideas and contributions about how to keep the company going - that would be neat.

I have no idea what is really going on there but as I am pushing for rapid evolution in a time of decline - I have my fingers crossed that wisdom will prevail and the crowd will have their way.

The Crowd is gathering.....

Academy Awards should follow American Idol

2009-02-23T09:38:00.000-08:00

In watching the Academy Awards last night I realized that it really is an interesting award ceremony albeit archaic.

When you think about the purpose of the award ceremony, it is to acknowledge people who have done something that crowds or the masses have found interesting and hence has become popular. This, in it of itself, is entertainment which is why it is a 4 or 5 hour show.

The dichotomy here is that the masses have determined what should be considered for an award nomination by the box office numbers. But then, the actual winners of the awards themselves is determined by the Academy (of entertainment) who are trying pick what they think the masses will approve of.

Again - the Academy Awards is simply a highly touted, highly commercialized and profitable entertainment event. For the record I think that this is a good thing and very appropriate.

But many times in the past the Academy has fallen under sever scrutiny because they failed to accurately predict what the people wanted and the result was that it affected the entertainment value of the ceremony, which affects revenue. Now, you contrast this with American Idol where they actually do the reverse; a select group of people choose the competing candidates and the masses choose the winners. By doing this, American Idol avoids the scandal rumors that often riddle the Academy Awards and the result is a winner as determined by the masses. American Idol proves that this is the best model for entertainment by their advertising revenue numbers show after show season after season which blows away the Academy Awards numbers.

Not sure that the Academy will read this blog and I am certain that if they do they will not give a sh%t; but they should. As the world continues to embrace technology the entertainment industry seems to lag where they should be leaping forward and taking lessons from successful models like American Idol.

Hopefully we are not one day talking about government bailing out of the entertaining industry because they too have failed to adapt to the market as with the auto industry.

The Crowd is gathering......

A crowdsourcing Obama

2009-02-21T08:49:00.000-08:00

In Peter Kollocks study of human contributions to online communities in The Economies of Online Cooperation: Gifts and Public Goods in Cyberspace, he points out that Web 2.0 did not invent anything. Rather, Web 2.0 simply made possible what people wanted to do anyway.

When I think about President Obama's approach to his campaign he really created Election 2.0 where it was the first time people could get involved with him if only indirectly via crowdsourcing. Similarly in his campaign he made possible what people wanted to do anyway; have a say in the country's outcome. The result was President Obama was able to ensure that his campaign appealed to his followers.

Now it is time for Presidency 2.0 where we use crowdsourcing to help re-shape

our nation. We are still far from the finish line but at least we are in the race!

I for one am very excited.

The Crowd is gathering.........

Wisdom of Crowds Vs. Referee

2009-02-20T16:00:00.000-08:00

Last night I was watching the San Jose Sharks play the Los Angeles Kings in a very exciting NHL hockey game. During the game two different Kings players made what is considered in the NHL to be "illegal hits" to the head on two different Sharks players which is a serious offense and deserves a "major" penalty. The natural response by the Sharks to these two separate events was to begin to start a fight which is tolerated (and almost encouraged) in hockey. Interestingly though in each case the offending Kings players did not receive "major" penalties but rather only received minor penalties even though the referees clearly saw both events. Because the Sharks retaliated they also received minor penalties which meant everything offset meaning the Shark were penalized exactly the same as the Kings

As I was watching this whole thing I just kept thinking that I wish I had my say in the matter, which I obviously do not. This got me to thinking about applying the wisdom of crowds to real time refereeing. If this were possible you would have to make sure that you had more than the fans of the opposing teams as the judge. In order to truly come up with the most accurate refereeing call you would need both the passionate and dispassionate judging every game. Now I know that it is unlikely that professional sports will come up with a process whereby each call is pushed to the crowd to determine the "right" call but I can see a world whereby the crowd will at least have their say along side the game.

Although this would not have solved my problem last night - it would have at least made me feel better.