Thursday, July 27, 2006

Paid Networks: Calacanis' Move to Pay Social Bookmarkers Draws Fire

When Jason Calacanis posted last week an offer to pay top social bookmarkers at Digg and other services USD 1,000 to come do the same for Netscape's redesigned bookmark-driven portal it ignited a firestorm of comments from webloggers and the leaders of the soon-to-be-poached portals. A recent post by head Digger Kevin Rose sums up the anti-Netscape side of the argument nicely: "Think of what your loyal Netscape users must think - you're essentially telling them that they aren't good enough and that you have to buy better users." Calacanis retorts: "You're making money from advertising and you can easily afford to pay the top 12 users $1,000 a month each--share the wealth dude! Why not carve out 10-20% of your revenue for users?"

And that's the high-brow end of the conversation...

Beneath all of this posturing both of these camps make strong points.

Jason is right that there's no harm in rewarding users on many levels for their participation in a community. It's worked for many years at About.com where paid docents assemble both content and links to key pages on the Web to turn their avocations or vocations into cash. Newsvine has a recognition system for user-posters that could be easily turned into a rewards model and Gather already rewards content contributors with gift certificate points. Different ways to build content and community, but each successful in their own right through recognizing the value of contributors in concrete ways. Building multi-tiered rewards systems are a key to successful user-driven content aggregation and distribution.

With a media-trained audience to educate on new ways of relating to content, Netscape faces an uphill battle in getting these users to adapt social bookmarking ways. Bookmarking "Navigators" will help Netscape to prime the process and to provide professionalism that these users still expect for guidance. The challenge that Calacanis faces is clear when one looks at the heatmap of topic interest on Netscape: celebrities, gossip, security and sex lead the list. It's a mainstream crowd, as is also reflected in the very typical stories culled from mainstream news organizations that adorn the "user selected" front page items.

By contrast Digg's most popular selections for the day from a community more than twice the size of Netscape's are awash in quirky content from all sorts of sources, including today's top choice - a bootlegged video from The History Channel showing how an Israeli pilot landed an F-15 fighter with only one wing left on the plane (Diet Coke and Mentos, where are you when we need you?). Somewhat of a contrast to Netscape's top story: "Al Quaeda Calls for Holy War Against Israel, " with accompanying Netscape Anchor commentary. There is an organic genuineness to the Digg selections, which , though frustrating for someone really trying to figure out what's going on in the world, reflect the true nature of like-minded content seekers who are very open-minded about what's interesting on the Web. It's not likely that Netscape is going to make significant inroads to that community's interactions just by poaching a few taggers: the goals of the two communities are so very different that they're not likely to have much overlap at this point.

But at the end of the day growth will tell the tale. In spite of - or perhaps because of - all of the negative press Netscape has been on a gentle uptick in popularity these past few weeks according to Alexa stats. By contrast, while Digg is hardly dying it seems to have reached the overall limits of its community's growth for now. As noted in our recent News Analysis Content Nation is built up of a wide variety of communities, with users who want to influence others a huge nation unto themselves. But there's a much broader nation who are still content to soak in the sights on a passive basis. It's not clear that the Netscape audience will be converted easily to more interactive online ways, but the potential growth factor for converting mass media audiences into participants in a mature and multi-layered community is significant.

In the meantime, the chaos of Digg has been barely harvested and is in danger of being squandered for lack of a more sophisticated management of its content strategy. True communities require both participation and leadership, leadership which recognizes that economic viability that's equitable to all will be a key factor in allowing a community to thrive in the long run. Netscape may yet stumble under the tutelage of mass media mavens who cannot adjust easily to the type of content that user-driven communities seek out, but with a predisposition to helping people make money as a reasonable goal it may have more options to consider without hitting the hypocrisy button in the eyes of its audience.
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