Why does crowdsourcing work?

Tim O’Reilly’s definition of Web
2.0 makes it clear that
“crowdsourcing” is one of the defining features of Web 2.0, not only
RIAs:

“The service automatically gets better the more people use it.”

Crowdsourcing is about taking it to the next step where people
‘contribute’ something to the ‘system’.

There are many people and companies trying to make crowdsourcing work
in different areas. For example, at
Kluster,
the participants get to design a product, etc. and the participants
who back the winning idea get to share the reward. What is interesting
is the story behind Kluster:

Kaufman came up with the idea for Kluster at his last startup,
Mophie, which makes iPod accessories and was recently sold to
mStation for an undisclosed sum. One of Mophie’s hit products is the
Bevy, an all-in-one iPod Shuffle case, bottle opener, cord-wrap, and
keychain. The company designed it at last year’s MacWorld conference
in 72 hours with input from 30,000 customers using software that was
a precursor to Kluster. According to Kaufman, Mophie sold hundreds
of thousands of the $15 cases.

And from the June 2006 Wired magazine
article:

Melcarek (a registered user at InnoCentive.com) solved a problem
that stumped the in-house researchers at Colgate-Palmolive. The
giant packaged goods company needed a way to inject fluoride powder
into a toothpaste tube without it dispersing into the surrounding
air. Melcarek knew he had a solution by the time he’d finished
reading the challenge: Impart an electric charge to the powder while
grounding the tube.  The positively charged fluoride particles would
be attracted to the tube without any significant dispersion.

“It was really a very simple solution,” says Melcarek. Why hadn’t
Colgate thought of it? “They’re probably test tube guys without any
training in physics.” Melcarek earned $25,000 for his efforts.
Paying Colgate-Palmolive’s R&D staff to produce the same solution
could have cost several times that amount – if they even solved it
at all.

More examples are:

• Dell Idea Storm where customers vote
  for what products they want Dell to do next – this is how Dell’s

recent introduction of Linux laptops happened.

• Get Satisfaction which is
  “people-powered customer service”
• Intel asking the crowd on what is the
  next Google
• MicroPledge and co fund
  os where people pledge their money for
  software ideas they like, once a good amount is reached, someone
  takes up that pledge and works on it. If he/she completes it
  successfully, they get the money and the crowd gets the software
  they want. This is the crowdsourced version of a bounty.
• Sell-a-Band where people pledge their
  money on bands they like. Sufficient money implies the band gets to
  record an album with that money. If the album sells, the crowd, the
  band and the SellaBand website share the profit.
• Kiva for microfinance loans to entrepreneurs
  in developing countries.
• Wesabe for personal finance.
• CrowdSpirit for electronics.
• Threadless for T-shirts.
• Everywhere Mag for a travel magazine.
• Crowdsourcing.com is crowdsourcing
  a book on crowdsourcing. Say that fast thrice.
• We can also include Youtube under the entertainment category.
• And many many
  more.

Heck, we even have an O’Reilly book on ‘Programming Collective
Intelligence’
(which has been sitting on my to-read list for too long).

The biggest and best example, of course, is Wikipedia, one of the top
10 largest websites in the world.

The article that blew my mind (and got me wondering about
crowdsourcing in the first place) is the Wikipedia page on British
crown succession
(via IndiaUncut) –
this page lists 1388+ people who are in the succession line for the crown!

But I wonder, why did Wikipedia work? Or rather, what makes people
contribute to Wikipedia?

The best research on this topic that I found was the article What
Motivates Wikipedians? in
the CACM monthly magazine:

I wonder if the companies mentioned above are specifically tapping
into some of these motivations.

The article goes on to explain the relative importance of these
motivations in their survey.  I was seriously surprised at how high
Ideology and Values rank here! If you get a chance, do read the whole
article, it’s a good piece of research.

Another interesting research was the paper Becoming Wikipedian:
transformation of participation in a collaborative online
encyclopedia which traces
how a casual visitor starts reading Wikipedia and goes on to become
a member of the community, and how the social
structure
and technological
aspects enable this.

I think I’m now beginning to understand what Jimmy Wales (founder of
Wikipedia) said when he was asked the same
question:

Love. It isn’t very popular in technical circles to say a lot of
mushy stuff about love, but frankly it’s a very very important part
of what holds our project together.

I have always viewed the mission of Wikipedia to be much bigger than
just creating a killer website. We’re doing that of course, and
having a lot of fun doing it, but a big part of what motivates us is
our larger mission to affect the world in a positive way.

…

Imagine a world in which every single person on the planet is given
free access to the sum of all human knowledge. That’s what we’re
doing.

Although this reasoning may apply to Wikipedia which is an
encyclopedia and information-centric, I wonder whether the same
applies to the other examples above. For example, consider
Threadless.com for T-shirt designs… what are the motivations for
people in that community? And how much does the website’s social and
technological structure play a role? What are the magic ingredients
that make a crowdsourcing website become successful?

Maybe I should crowdsource this question. Hmmm.

Maybe it is not different from any other kind of website which becomes
successful but I think crowdsourcing websites are distinct from
content websites like SmashingMagazine.com or e-commerce websites like
Amazon/eBay, etc.

Now, the next question is has anybody successfully crowdsourced
anything in an India-specific way?

Update on 2008 May 13: ReadWriteWeb has a similar list.