Getting Rich Off Free Labor

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Time magazine looks at getting rich off those who work for free. It's not very in-depth, but is one of the articles that, finally, is beginning to break out the real rules of open source work and peer production. Volunteering is nothing new – people have donated their skills to non-profits for generations, but over the last few years there has been this ridiculous movement that acts like a volunteer workforce is going to reshape commerce and take down big companies. It will, but only in a few instances. This quote from the article is a good example.

Clever entrepreneurs and even established companies can profit from this volunteerism–but only if they don't get too greedy. The key, Benkler says, is "managing the marriage of money and nonmoney without making nonmoney feel like a sucker."

People are willing to donate their free time to things, but the return they receive has be greater than the effort they expend. This means that extremely busy people aren't going to do it because they have no spare capacity. It also means you have to watch out for the "jury effect" – which is what happens when you get a bunch of people willing to contribute because they have the time, but they may not be the right people.

To add to Benkler's point – you should try to tap intrinsic motivations and let people use skills that may be underutilized in their regular jobs. The problem with what I just wrote is that it's extremely difficult to do. If you can find a way for people to appropriately self-select, that would be great, but self-selection is often influenced by cognitive biases. You get people who think they are much better at something than they really are. If you have to put people into positions based on interest, skill, and an understanding of the work, then that takes a lot of time. Another option is to run it like a competition – let people duplicate contributions and then choose the best one, but then you can get motivational problems.

All of these are hard to execute. And the bad news is that they only work within a limited set of contexts. That's my main Web2.0 beef – that everyone acts as if the Linux model and sharing, tagging, altruistic behavior, etc. is the only way to go for new products and ideas. But people are still human. We still want personalization, convenience, and the ability to express our individuality. Web2.0 works best when the marginal cost of sharing is low.

It's nice to at least see the early seeds of the media's attempt to clarify the context of this fad.