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There's a flaw in the argument that most people miss, namely that since it's so easy to create and distribute information everybody does it, making it so much h

by mixmax 15y ago

There's a flaw in the argument that most people miss, namely that since it's so easy to create and distribute information everybody does it, making it so much harder to create a viral effect. To extend your example: If just 1% of the population sent a Brad Templeton joke to everyone on the Internet you would receive 10 million emails with a funny joke. If you chuckled at 1% of them you'd send a penny to 100.000 people. Not a very likely scenario. Since none of us receive 10 million joke emails this means that things aren't as simple as they appear. The fact is that since so much information is being created the bar for virality is extremely high, and it's rising proportionally to how easy it is to create information. The chances of your funny email reaching millions of users are as high as your chances of winning the lottery. The resemblance to slick entrepreneurs pitching their wares with the clasical "if only 1% of the market uses our product we'll make billions". That's just not how it works. Note that I'm not necessarily disagreeing with your thesis that once a startup has reached virality it can be worth a substantial amount of money, I'm simply stating that reaching that point is as hard as ever.

ChuckMcM 15y ago
"There's a flaw in the argument that most people miss, namely that since it's so easy to create and distribute information everybody does it, making it so much harder to create a viral effect." An excellent observation. And you have to consider that not all information has the same value and that its value varies over time. Brad's scheme does have the flaw you describe (and it was another of the rat holes people would fall into, "Well Gee, once he sends out a joke what is to stop anyone who got from sending the same joke out to everyone but making them the recipient of the penny?") The mechanism is valid, but, as you observe, won't work with easily reproduced information. Google sells information that is both 'rare' and temporally relevant. They sell 'a person is looking for X right now' and advertisers buy access to that information with their AdWords bids. The nice thing about this information is that its very valuable to certain people (people who think they have a product for people looking for X) when it gets created and a couple of seconds after it gets created it is worth 100x less (maybe even 100,000x less, basically only as trending data).
- mixmax 15y ago
  That's actually very interesting - what you're proposing is that to create a viral effect you don't send the same joke to everyone but tailor it algorithmically to suit each recipient based on his history or some other parameter. The trick, of course, is being able to gather and mine the data needed to do so. It seems that facebook, Google, and a lot of other successful companies are following this model.
- PaulHoule 15y ago
  I was at a conference last month and was talking to a guy from Elsevier (a major scientific journal publisher.) I was telling him how getting a piece of content for 5 cents that makes 5 cents of revenue was "a pretty good business" and he was shaking his head as if I was insane.
  - impendia 15y ago
    Elsevier's business model is to take content for free -- indeed, to persuade people to beg you to accept it -- and then to sell it back to the same people for thousands of dollars.
alttab 15y ago
Your extension changes the analogy. One person clicking on something relevant to their search is different than one person clicking on X relevant searches. The "chances" of an e-mail reaching X number of people entirely depends on the e-mail list you've compiled. The company I work for sends an e-mail every week and it reaches over a million people every single time. Even if you make a 1% conversion on that list each time, you are showing continual and repeatable return, which some call a "business model". A lot of us get caught up in the fact that this model has nothing to do with the actual product.

by mixmax 15y ago

ChuckMcM 15y ago

"There's a flaw in the argument that most people miss, namely that since it's so easy to create and distribute information everybody does it, making it so much harder to create a viral effect." An excellent observation. And you have to consider that not all information has the same value and that its value varies over time. Brad's scheme does have the flaw you describe (and it was another of the rat holes people would fall into, "Well Gee, once he sends out a joke what is to stop anyone who got from sending the same joke out to everyone but making them the recipient of the penny?") The mechanism is valid, but, as you observe, won't work with easily reproduced information. Google sells information that is both 'rare' and temporally relevant. They sell 'a person is looking for X right now' and advertisers buy access to that information with their AdWords bids. The nice thing about this information is that its very valuable to certain people (people who think they have a product for people looking for X) when it gets created and a couple of seconds after it gets created it is worth 100x less (maybe even 100,000x less, basically only as trending data).

mixmax 15y ago
That's actually very interesting - what you're proposing is that to create a viral effect you don't send the same joke to everyone but tailor it algorithmically to suit each recipient based on his history or some other parameter. The trick, of course, is being able to gather and mine the data needed to do so. It seems that facebook, Google, and a lot of other successful companies are following this model.
PaulHoule 15y ago
I was at a conference last month and was talking to a guy from Elsevier (a major scientific journal publisher.) I was telling him how getting a piece of content for 5 cents that makes 5 cents of revenue was "a pretty good business" and he was shaking his head as if I was insane.
- impendia 15y ago
  Elsevier's business model is to take content for free -- indeed, to persuade people to beg you to accept it -- and then to sell it back to the same people for thousands of dollars.

alttab 15y ago

Your extension changes the analogy. One person clicking on something relevant to their search is different than one person clicking on X relevant searches. The "chances" of an e-mail reaching X number of people entirely depends on the e-mail list you've compiled. The company I work for sends an e-mail every week and it reaches over a million people every single time. Even if you make a 1% conversion on that list each time, you are showing continual and repeatable return, which some call a "business model". A lot of us get caught up in the fact that this model has nothing to do with the actual product.