Fascinating. The set up:
At Google, employees are encouraged to go online and place bets on a prediction market — an exchange that tries to forecast events based on the money wagered on a particular outcome.
Prediction markets have been used for years to predict things like elections. At Google, they are used, of course, for business. In the last two and a half years, 1,463 employees have made wagers with play money (Goobles, as in rubles) on questions like: will Google open a Russia office? will Apple release an Intel-based Mac? how many users will Gmail have at the end of the quarter?
The pay off:
According to the report, “Using Prediction Markets to Track Information Flows: Evidence From Google,” which was presented Friday at the American Economic Association meeting in New Orleans, the strongest correlation in betting was found among people who sat very close to one another, trumping even friendship or other close social ties.
This is tangible evidence, the authors argue, that information is shared most easily and effectively among office neighbors, even at an Internet company where instant messaging and e-mail are generally preferred to face-to-face discussion.
Link to the report (PDF download)
The Times’ piece on the launch is up.
“We want to make it really clear that when people arrive and do searches, they should not expect to find a Google killer,” Mr. Wales said. Instead, people who use the Wikia search engine should understand that they are part of the early stages of a project to build a “Google-quality search engine,” Mr. Wales said.
Far ranging piece, still reading it, by Ken Auletta, who I spoke to for the piece.
A fascinating movie comprised of 50 hours of the Techmeme homepage condensed to 50 seconds, from Amit. You can’t help but wonder what might be learned from the patterns unfolding in front of you, I want to see more!
The recent kerscobuffle around data portability got me thinking out loud about what the value of a social network really is – and by extension, any service that might claim to have “lock in” around our personal data.
For years now, a core (unresolved) issue in the Web 2 world has been data portability – with most of us – including me – arguing vaguely for the right to take our data where we want, when we want, without undue interference from the service that helped us aggregate it.
As the debate deepens, it seems there are two camps – first, the camp that says Facebook has either A. a right and/or B. an economic necessity to create a walled garden for our data. The second camp argues that Facebook – and any other walled garden – is A. Stupid or B. Greedy or C. Both.
I think I’ve been pretty consistent in my support of the less-than-nuanced second group of campers.
But I’m not entirely sure the debate is framed correctly. It assumes the key question is about whether or not the data can be ported. Instead the real value creation of a service is what that service allows a person to *do* with that data, once it’s found its way there.
To frame the discussion, think about the idea of competing on the lowest price. This has always been a major point of pain in retail commerce – how can I compete on price if my costs of goods sold is the same (or, shudder, *higher*) than my competitors? My answer is to change the game: Don’t compete on price. Compete on *service*.
An example. My local market charges far more for a good bottle of wine than many shops that are nearby. But there’s a wine guy who works at that market who knows wine cold, and who I trust. Also, the market is close to my home, and I have a personal relationship with the fellow (OK, here’s the reference to the book I’m working on – I have a “conversation” going with this merchant). Those factors, combined with a certain ambiance at the store that I really like, all lead to one result: I buy my wine at the more expensive store. Why? Because the store competes on more than price.
It’s time that services on the web compete on more than just the data they aggregate.
I think the data portability crowd is driven by this idea, in the main – once we have real data portability, personal data becomes a commodity, and services then live or die not on data lock in, but on *service* lock in. Imagine a world where my identity and my social graph is truly *mine*, and is represented in a machine readable manner. Were that the case, the entrepreneurial opportunities to create second order value are immense.
Is this the goal of Open Social? I’m not sure. Danny has pointed out how Google is of two mouths when it comes to the idea.
The problem is, no one seems ready to truly set the social graph free. Till now.
With one move, Facebook can change the face (sorry) of this debate by making it falling-down easy to export your social graph. And I predict that it will.
Why? Because I think in the end, Facebook will win based on the services it provides for that data. Set the data free, and it will come back to roost wherever it’s best used. And if Facebook doesn’t win that race, well, it’ll lose over time anyway. Such a move is entirely in line with the company’s nascent philosophy, and would be a massively popular move within the ouroborosphere (my name for all things Techmeme).
Compete on service, Facebook, it’s where the world is headed anyway!
I get the sense that Google is, in many respects, a really really great Grad School that folks leave – after four or five years of hard work – with a degree in well heeled “Now What?”? Latest good guy to leave: Nat Stoll. Best of luck in the new venture, man!
This decision has been quite difficult but ends with positive feelings. I’ve felt in the past months as if I was breaking up with Google, and I don’t think that to be a stretched analogue. I have countless close friends who I’ve been through the eye of the storm with to see clear sky, and we have history that is hard to think past. So, for all of my friends still in the ‘plex, know that “it’s not you (Google), it’s me,” and I hope that we can still stay close after we take some time apart.
Update: Kevin Fox is leaving too.
Read through the notes they write. They are very, very similar.
Wait, here’s another. Hmmmm.
Doc notes my post on conversations and asks why we, as consumers, are not more empowered to control our conversations/interactions with businesses who have tons of information about us and our use of their products/services.
I think what we need is something like an API. Let’s call it an VRI: Vendor Relationship Interface. Through it I could know, and see, what I’m getting from each vendor with which I “relate”. On top of that the dashboard could be built.
An interesting thing here is that I really don’t want to have a conversation of the literal kind with most of these companies, unless there’s a problem. I do want to relate with them, however. That is, I would like to request or arrange for services, pay bills and occasionally make suggestions or provide feedback. Most of that does not require wasting the time of another human being. A lot of that could be automated.
It’s just that simple. Deal with it.
And I think FB will. I have seen commentary on Digg and elsewhere to this end:
Facebook won’t join Open Social, and you can forget about the pipe dreams of the Data Portability movement. The simple fact is, as the market leader, there is no benefit for or strategic advantage in Facebook making your data available to you in any format you wish.
I disagree. I think FB will open up. It’s in their best interest.
Update: Scoble is back in the good graces of Facebook, that is to say, he is no longer banned. But I think the issue is pretty clear cut, and has to do with what is commodity, and what is unique. I have a post in me on this, that will come.