Yes, on many topics Google is the most efficient resource. When I use google I typically find what I’m looking for BUT I only use google as a lookup for stuff I know I’ll find. Google is just a big address book for content. What I don’t use google for is fuzzy searches. There are far better tools and communities for finding “the best” of something or “the first” something – google will never be good at that, so I dont go to google for advice – I go there for facts. Google is an awesome hammer – if you’re disapointed with it that may be because every “knowledge search” looks like a nail.

I totally agree that digg is a crap way to find “the best” stuff – it is an interesting alternative to MSM though – the content is no more unique.

No ammount of personalization will ever be able to read my mind and know the context of my query – tools like google will always need to be interpreted by their users.

The stock market is still one of the best and longest standing examples of “wisdom of crowds.” And what does that teach us? That crowds are subject to bubbles, biases, mania, and depression. The stock market is not efficient and has crazy behavior sometimes. Wisdom of crowds only works in a very small set of situations. While I appreciate your points, I think crowds are wise when they are rational, and that isn’t most people.

David,
While I agree that Wikipedia isn’t a good example, I disagree with you on Google. I think it is a good example because I find myself using del.icio.us for research more and more, as Google gives me junk answers.

And Yahoo answers is a perfect scenario of crap vs. substance. I have to wade through 50 dumb questions like “which one of you ladies reading this is the hottest?” or “how was youralls weekend?” to find something that is worth my time to learn/ask/answer.

The power of the web will be in personalization, but we haven’t gotten there yet. We mistake popularity for personalization. We think if lots of people like it (Digg, for example) we should like it too. I don’t want a site to show me what everyone else likes/does/thinks, I want a site to show me what I will like. Web 2.0 should be about pushing complexity and computation back onto the web, making the user blind to it, not aggregating what is popular, because that is too easy to manipulate. Does anyone really believe that the highest ranked sites in Google are the best resources? I think they are just the best at playing the SEO game. Does anyone really believe the stories on the front of Digg are the most interesting? Or are they just the ones that get picked up because the contributors I.M. their friends and get them to vote?

wikipedia is the worst possible example to use to make the point that “free” doesn’t work – google is next worse – it would be nice if the writer cited the “for-fee” resources that do a better job of searching the web – oh yeah, they don’t exist!!!

search does not work for all information discovery – but not because it’s free – because some “knowledge” is only valid in a certain context, so you’ll never find consulting advice via google. Maybe the author’s expectations of the utility of google need to be reset.

And just because search is not the most efficient means on discovery – does not mean that the better methods are “for fee”. Just look at blogging and yahoo answers – they are better ways (than search) to discover info in context – but they are still free.

Beating up on google and wikipedia is like standing in front of a mirror with your eyes closed – their adoption has proven this a moot point – clearly there is significant utility in these tools. Can they be improved upon? Sure. Will that solution also be free? Probably.

As for running businesses using the wisdom of the crowd, a crowd can tell you waaaay more than what it wants. It all hangs on what crowd you listen to and how you listen.

Also I don’t agree with “Everyone thinks they know more than they do” – it’s too bleak. Even if it were true, the effect of efficiently collaborating crowds is precisely to distill the communally held knowledge or wisdom. To find the stuff you can use and trust in the middle of what we all know.

If you ask me, we have only seen the beginning of what is possible in this direction. I definitely see our abilities and tools getting better and better – not worse like AQA do.

Wisdom of crowds can’t tell you what to produce, because production decisions depend on more than just what the crowd wants. To listen to the crowd would ignore issues involving capital allocation, resource tradeoffs, legal issues, etc. that have to be considered when making business decisions. All a crowd can tell you is what the crowd wants. Certainly that is valuable, but it isn’t new. It’s just easier to figure out now with new technology, so there is less guessing involved.

All this praise of Web 2.0 as revolutionary reminds me of a book called “Dow 36,000.”

That’s the point!!

What many people don’t get, and don’t seem to want to get, is that content created by many amateurs can be way more useful than content created by a few experts.

And remember, this collectivist business nonsense is a relatively new fad – that it even works at all is amazing. Imagine how well it can work with a few decades of trial and error under its belt…

Also, I predict you’re wrong about Google’s premium search offering )

The problem with amateurs is that they think they know things that they don’t. Wikipedia is great for general knowledge type stuff, but it sucks for detailed information in many areas.

For years, guys like Buffett have exploited the folly of the masses as they move from one stupid fad to another. I don’t see any reason that such behavior will stop. Remember that I started The Business Experiment before most people had ever heard the term Web 2.0. I was lucky enough to realize the limited situations where the wisdom of crowds applies, and get out of it before things went too far. I think over the next 5 years you will see many VCs wishing they had learned the same lesson.