Wired Pursuits

Posts Tagged ‘Internet

So much about innovation is changing. Globalization, increased need for speed to market, increased costs, mobile workforce, and maybe most importantly the proliferation of the Internet and online collaborative tools. I think O’Reilly’s quote sums it up nicely.

“The central principle behind the success of the giants born in the Web 1.0 era who have survived to lead the Web 2.0 era appears to be this, that they have embraced the power of the web to harness collective intelligence.”

O’Reilly, 2005

Instead of turning to paid analysts, or internal experts some companies are using the crowd to help improve the accuracy of demand forecasts as well as better manage inventory and manufacturing capacity.

Predictive markets, often also referred to as information markets, aggregate the knowledge of the crowd to make predictions regarding unknown future events. By aggregating distributed knowledge the predictions of the crowd are often more accurate than when companies rely on only a handful of experts.

How do they work?

In prediction markets, individuals buy and sell “futures” or “shares” based on their beliefs regarding the probability of the event taking place. If they are correct, they are rewarded for their efforts. Because of U.S. laws related to online gambling, rewards often take the form of play money, gift certificates, or recognition within the market.

What is interesting about prediction markets is their structure creates incentives for individuals to act on their closely held information. Because rewards are tied to correct predictions, individuals in the crowd who have access to more information, which may aid in their understanding of the market, tend to buy more shares than those who are just guessing.

For example, Google uses over 300 internal prediction markets to assess events such as customer demand for new products (“How many Gmail users will there be on January 1, 2009?”), company and product performance (“When will the first Android phone hit the market?”), and competitor performance (“How many iPhones will Apple sell in the first year?”). In addition to new sources of predictions, Google has used these prediction markets to better understand and improve the flow of information within their company.

Do predictive markets work?

As with many new uses of the crowd, we have only scant evidence regarding the effectiveness of prediction markets. Best Buy reports internal prediction markets designed to predict holiday sales of gift cards were 99.5% accurate compared to a 95% accuracy rate from external consultants. Intel also reports success with their internal “forecasting markets.”

Faced with the difficult task of predicting demand of products requiring lead times of months or even quarters, Intel found their internal markets were at least as accurate as official figures and in some cases more accurate by 20% (i.e., 20% less error).

There is, however, evidence that outside factors can impact results of these markets. Some data suggests employees may be overly optimistic regarding company performance tending to artificially inflate positive results. For publically traded companies, stock performance can influence predictions upward or downward in line with the latest market swings. And finally, there are also numerous issues related to providing the right incentives for participation as well as obtaining executive buy-in for such initiatives.

I ran across this new saying at a panel discussion I was on regarding teaching with technology. Got me thinking. Has Google replaced thinking? Has Twitter replaced speaking?

I don’t think so. I think it’s more a comment on the impact the Internet and social media is having on our culture. Both positive and negative. We now have new ways of learning about new topics and verifying facts.

But with all the user generated content on the web, how do we ensure the accuracy of what we’re reading? Studies on Wikipedia have shown it is as accurate as the Encyclopedia Britannica. But what about other sources? Do sites referenced by a Google search provide us with accurate information?

There used to also be another saying, “If it’s printed in the newspaper it must be true.” Is society transferring that (potentially unknowingly) to the Internet?

No, I don’t mean crowdsourcing is “for the birds,” as in worthless. I literally mean crowdsourcing for birds. Here’s an interesting application of turning to the crowd to generate data – bird data.

Cornell Lab of Ornithology and the National Audubon Society have joined together to leverage the collective productivity of the crowd to accomplish a task they would never be able to do on their own. They have created the online site eBird.org.

eBird enlists the help of bird watchers across North America to collect and document the presence of specific bird species. Using the eBird site, birders can report sightings and access the latest data on bird populations across the western hemisphere.

By leveraging the interests of the crowd and providing the ability for them to easily contribute to a shared cause, site sponsors are now able to accurately track bird populations more quickly and economically than they could with in-house staff. In 2006, more than 4.3 million observations were submitted by bird watchers across the country.

Interestingly, the site doesn’t have any collaborative tools where birders can talk to each other, but it doesn’t appear to need them to generate a sense of community.

If you know of other sites that leverage the crowd to collect data, please let me know.

When the Internet and email first started being used for communications many complained that it would never be as rich as face-to-face communications. It was devoid of emotion, feeling, or personality. You couldn’t really get to know the person you were interacting with. But over time that has changed. Individuals have come up with interesting ways to add emotion and feeling to their communications, and new technologies such as audio and video are allowing individuals to hear an individual’s tone of voice and watch their body language and mannerisms.

We are emotional creatures.

People are by nature emotional creatures. We gain many clues to others by watching their body language, listening to the tone of their voice, and looking them in the eye. How many times have you heard the saying, “it’s not what you say, it’s how you say it comes from?”

With email and the Internet all that was missing in the beginning. Sometimes individuals misunderstood messages because there were no external clues to what the sender really meant. But as social beings, we have come up with many creative ways to add emotion, and therefore understanding, to our electronic communications. I’ve been lucky to be able to see these changes being used by more and more people over the years.

Adding emotion to our electronic communications.

Below is a list of just some of the ways we are putting a face on our communications (well the ones I can think of). I’m sure I’ve missed some, so if you think of others, please add them. Note that I am not including all the design tricks such as color, font, and layout that designers can use to create a “feeling” around a web page. Instead these are things that most individuals can do to convey emotion using a basic keyboard.

  • CAPS LOCK. A simple way to add emphasis. Basically the electronic equivalent of yelling.
  • Bold. Another simple way to show emphasis.
  • Emoticons. Probably the most interesting. Those pesky little characters often added to email, IM, and blog posts to convey feelings. Smile:  :-), wink ;-), shock =o to name a few. Interestingly, emoticons didn’t start with email. There were actually used on the Plato system in the 1970. But the popularity of email has made them more known and common to the general public.
  • Profile photos. Profile photos on Facebook, Twitter, and forums are great ways to send clues about personality (or hide them). Whether they are actual photos or avatars both convey a sense of the person you are communicating with.

The Internet never forgets…

“I’m rubber and you’re glue.  Anything you say bounces off of me but sticks forever in cyberspace.

Why I love the Internet.  (Case in point – posting random thoughts just like this.  Hummm, let’s see what’s going on on Twitter.)

“The beauty of the Internet is that when I want to avoid doing work, I don’t even have to get up to find a distraction.”

So I’m still on the TV/Web kick.  I find so many similarities between these two mediums. So here’s a test. Below are 7 quotes.  Can you identify which refer to TV and which to the web?  (Note I have eliminated words that would make this too easy.)

  1. “… has transformed the political life of the nation, has cha­nged the daily habits of our people, has molded the style of the generation, made overnight global phenomena out of local happenings, redirected the flow of information. In other words it has profoundly affected what we call the process of socialization…”
  2. “… isolates people from the environment, from each other, and from their own senses.”
  3. “… should be the last mass communication medium to be naively designed and put into the world without a surgeon-general’s warning.”
  4. “… enables you to be entertained in your home by people you wouldn’t have in your home.”
  5. “… is simultaneously blamed, often by the same people, for worsening the world and for being powerless to change it.”
  6. “… is an anesthetic for the pain of the modern world.”
  7. “…is the greatest single achievement in communication that anybody or any area of the world has ever known.”

So how did you do?   Amazingly all the quotes above were made in reference to television.

  1. George Gerbner, Dean of Annenberg School of Communications, University of Pennsylvania, 1968.
  2. Jerry Mander, Four Arguments for the Elimination of Television, 1978.
  3. Alan Kay
  4. David Frost
  5. Clive James
  6. Astrid Alauda
  7. Hubert Humphrey, 1961.

Do current TV trends give us insight into the future of the web?  If you follow the evolution of TV, it’s quite striking how similar it is to what’s happening with the web.  Below is a quick journey through TV’s evolution. Read it once, then go back and read it again thinking about the web. 

Wow that’s cool.

­When TV first hit the airwaves there were few working channels.  You had limited choices but that was ok since the whole thing was so novel.  You waited until your favorite show came around, then turned on the set to watch. When it was over, you went back to other interests.  You didn’t have anything to compare it to so what you got was ok by you.  And advertisers had yet to realize the potential of this new medium.

More options please.

Soon the novelty of TV starts to wear off.  Viewers began demanding more choices in programming.  Production quality starts to get better and color and special effects are introduced – all in an effort to keep viewer’s attention.   Networks introduce different formats – talk shows that feature celebrities, full-length news features, and game shows – all catering to the different needs and desires of viewers.

Some shows get their audiences directly involved.  Their programs tap into the collective intelligence (or in some cases ignorance) of their viewers.  The audience is actually contributing content to the broadcast.  It more interactive, engaging, and feels more genuine.

Give me what I want when I want it.

Programming explodes as more and more people have access to cable.  There are hundreds (I personally have over 800) of channels.  Some channels are dedicated to very specialized interests – The Military Channel, The Food Network, Home Shopping Network, SciFi, even the Global Catholic Network.  It’s less about general information and more about appealing to specific interests.

Give me control.

Today, TV is entering an era where it’s not just about having choices.  Now, viewers want to control the outcomes of the programs they watch.  New shows like American Idol, Beauty and the Geek, and So You Think You Can Dance, let viewers vote to determine who wins.  It’s the hottest trend.  Why?  Because viewers no longer want to be passive observers, they want control.  They want it their way.

Sound familiar?

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