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The YouTube elite

May 04, 2007

As Om Malik reports, YouTube is splitting its much vaunted "community" into two tiers: a handful of stars who get paid for their work, and a great mass of unpaid volunteers. Malik quotes YouTube executive Jamie Byrne: “A select group of content creators will get promotion on the YouTube platform, and we will help them monetize their content ... We want to ensure that these talented people can start making a living off their efforts."

"A select group"? "These talented people"? So much for the myth of the social collective.

Last July, I entered into a wager with Yochai Benkler, the Yale law professor who wrote The Wealth of Networks. Benkler argues that the Internet is enabling a new "social production" system that does not "rely on either the price system or a managerial structure for coordination." The shift away from paid, professional labor, he says, will bring "a quite basic transformation in the world around us, and how we act, alone and in concert with others, to shape our own understanding of the world we occupy and that of others with whom we share it."

I argued that "the reason 'social media' has existed outside the price system up until now is simply that a market hadn't yet emerged for this new kind of labor. We weren't yet able to assign a value - in monetary terms - to what these workers were doing; we weren't even able to draw distinctions between what they were contributing. We couldn't see the talent for the crowd. Now, though, the amateurs are being sorted according to their individual skills, calculations as to the monetary value of those skills are starting to be made, and a market appears to be taking shape. As buyers and sellers come into this market, we'll see whether large-scale social media can in fact survive outside the price system, or whether it's fated to be subsumed into professional media."

In a comment, Benkler wrote:

I predict that the major systems [of Internet production] will be primarily peer-based ... It is just too simplistic to think that if you add money, the really good participants will come and do the work as well as, or better than, the parallel social processes. The reason is that the power of the major sites comes from combining large-scale contributions from heterogeneous participants, with heterogeneous motivations. Pointing to the 80/20 rule on contributions misses the dynamic that comes from being part of a large community and a recognized leader or major contributors in it, for those at the top, and misses the importance of framing this as a non-priced social process. Adding money alters the overall relationship. It makes some people "professionals," and renders other participants, "suckers." It is not impossible to mix paid and unpaid participants, as we see in free and open source software and even to a very limited extent in Wikipedia. It is just hard, and requires a cultural form that is definitely not "now at long last we can tell who's worth something and pay them, while everyone else is just worthless."

With YouTube's move, we have a good opportunity to see whether "the really good participants" are motivated by fellow-feeling and prefer to operate in a "non-priced social process" or whether, in fact, they're more than happy to enter "the price system" and earn some scratch.

YouTube itself doesn't seem to be under any illusion that its community operates outside the price system. In announcing that it would begin rewarding its "most popular and prolific original content creators" with a bit of the green stuff, it happily dangled the carrot of compensation in front of the rest of its contributors: "So now that you’ve read this, you’re probably wondering, 'How can I get in on the action?' This is only available to the initial participants. But if you create original content, have built and maintained an audience on YouTube, and think you might qualify for this program based on what’s above, you can express interest on our partnership lead form. We hope that this program inspires people to keep creating original videos, building audiences and engaging with the YouTube community." Translation: money talks.

Needless to say, I'm pretty sure that "talented people" will demand compensation (particularly when they see that a site owner - Google, in YouTube's case - is making good money off their work). That doesn't mean that there won't be a lot of people that contribute their work for free (or for a pittance) to gain attention or feel part of a community or whatever. It just means that the price system will in most cases win, and that the exceptions - Wikipedia, notably - will be exceptions. Indeed, in the vast majority of cases even the masses of unpaid volunteers will work within the price system. While the stars make good money, the masses will simply donate the economic value of their work to the site owner. The reason they'll do that is because, in isolation, their contributions have little economic value. For the successful site owner, however, all those tiny contributions, once aggregated, can turn into a large pile of cash.

Comments

Benkler's is a good book, but my money's on you for the bet.

I guess this is Google's attempt to avoid the charges of making loads'a money off other people's work as YouTube add to the volume and sophistication of advertising placement on the site. By paying some content creators, advertising becomes mutually profitable and therefore OK.

Getting almost all the advertising money is much easier for Google to defend that getting all the advertising money.

Posted by: tom s. [TypeKey Profile Page] at May 4, 2007 03:53 PM

Great post! We need more detailed analysis of the unfolding elements that social media, content creators and the like bringing to the fore. Your insights are greatly appreciated. Alan.

Posted by: alan [TypeKey Profile Page] at May 4, 2007 07:01 PM

An amusing dimension of the "this is the end of paid work and property" arugment is that it is usually made by legal academics, who (1) are very well paid, and (2) own the beach-front property of the Internet world -- tenured chairs at major universities. (3) occupy a world that is almost medieval in its class structure and its distinctions between lords and serfs.

Once, when I had the pleasure of talking briefly with Hernando de Soto, he commented that the term "property rights," used south of the Equator, is interpreted as meaning "protect the rich." Many Latin American property holders do not share the Yankee view that property rights are important to economic development. Quite the reverse; they regard property rights as a way to forestall development that might upset a social structure that is to their liking.

I cannot shake the feeling that the U.S. academics are much the same. Their estancias are pleasant, sipping pina coladas and watching the peons labor in the sun, and the explosive change that would come from the ability to monetize the contributions of the toiling masses of intellectuals would not be to their liking.


Posted by: James DeLong [TypeKey Profile Page] at May 5, 2007 08:53 AM

The controversy over Barack Obama's campaign team appropriating a supporter's MySpace site is relevant here. The supporter had spent two and a half years creating the site, and attracted 160,000 signed up Obama supporters. Yet Obama's team just took the site, with the complicity of MySpace management.

Understandably miffed, the site creator sent a bill for nearly $40,000 to the Obama campaign team. As a paralegal, he was well aware of the value of professional time. So far the Obama team is refusing to pay.

http://www.techpresident.com/node/301

As the TechPresident article points out, media consultants who attracted 160,000 signed up supporters would have been paid handsomely. A further post assesses the value of the MySpace site.

http://www.techpresident.com/node/307


Posted by: Tony Healy [TypeKey Profile Page] at May 5, 2007 10:45 AM

Just for reader's information, it should be noted that James DeLong is a professional Libertarian propagandist, who in 2003, made upwards of $140,000 in his role as Senior Fellow of the "Progress and Freedom Foundation". You will note the common trope of "a magna cum laude graduate of Harvard Law School, where he was book review editor of the Harvard Law Review, and a cum laude graduate of Harvard College" attacking academics and intellectuals, and the whopper of trying to get one to sympathetically regard property as somehow against "the rich".

While this is not a point in favor of Benkler, it is really, really, annoying for DC lobbyists to sleazily try to use these issues for their own personal plutocratic agenda.

Posted by: Seth Finkelstein [TypeKey Profile Page] at May 5, 2007 02:26 PM

Nick wrote: " While the stars make good money, the masses will simply donate the economic value of their work to the site owner. The reason they'll do that is because, in isolation, their contributions have little economic value. For the successful site owner, however, all those tiny contributions, once aggregated, can turn into a large pile of cash."

The problem is that that the site owner does not own his/her contributors.

While the site owner can dangle money, unless there is something else of value the owner gives, any other site owner can dangle just a little bit more to bring about an exodus.

I am not sure that we know how this will shake out, since the entry costs for a compelling site are so low, and the "A listers" that make a site are both mobile and fickle.

This isn't like the radio industry in the 30's which quickly required high capital requirements.

I would agree with you, if the site owners in order to keep their contributors had to upgrade the net, laying dedicated optical, high security, or items like that. Don't see it, yet.

It may be that the current internet will become like ham radio- the purview of the dedicated hobbyist- but until that happens I think we will still see a great deal of flux, destruction and rebuilding of the popular web channels.

Posted by: michael webster [TypeKey Profile Page] at May 9, 2007 09:48 PM

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