Transcript for Wired Biz: The power of crowdsourcing

[crowd roaring in background]

In the entirety of human history, the crowd was dependent on proximity.

We had to be together physically in order to create a crowd

Suddenly, with the internet, we were able to create a virtual crowd.

And what this allowed is to allow people to get together through intent,

through shared interest - "crowdsourcing"

This is new, this is a fundamentally new development in the course of human history

Jeff Howe - Journalist, Author

Communities are able to form simply out of shared interests, shared passion, or a hobby, a craft, an art.

So crowd sourcing is when a company takes a job that was once performed by employees

and outsources it in the form of an open call, to a large, undefined group of people, generally using the internet.

There is a couple crucial terms in there

One is open call, and the other is undefined, and they both get the same idea

That the person who you think would be best qualified to do a job isn't always the best person to do it.

And the cocktail party version is very simple - it's crowd sourcing is Wikipedia with everything.

Photography is a great example, because it is what I think of as the canary in the coal mine.

What's happened over recent years in photography is the advent of 3 separate developments -

the first is the digital camera, the cheap affordable SLR digital camera

the second is photo editing software which has become easier and easier to use,

and the third of course is the internet.

And so the quality level of stock photos produced by amateurs

essentially reached an equilibrium with those created by professionals.

What happened is that stock photos were no longer a scarce commodity - they became an abundant commodity.

Instead of charging $300 per stock photo, they charged a dollar,

and as you can imagine, the demand for a commodity that had been marked down by 99% was huge.

I don't think crowd sourcing eradicates a business, it just changes it dramatically.

It forces companies to approach us as potential partners, and that's much more interesting

and much more exciting.

We do buy things, but we also participate meaningfully in the process by which those products are created.

What we see with these successful forms of crowd sourcing is that they came up organically

from the people formerly known as customers, from the people formerly known as the audience.

The technology is so good that it has become easier for people to become very good.

And then finally, the emergence of online communities.

I like to think of the online community as kind of a building block of crowd sourcing

it's what the corporation is to the industrial era.

It showed that people could come together and self organize into productive units.

What once took managers and a corporate hierarchy can now be done in the context of the community.