Infrastructure // PC & Servers
Commentary
8/23/2005
06:12 PM
Mitch Wagner
Mitch Wagner
Commentary
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User-Created Content: The Next Big Thing That's Already Here

You want to know where the big money is coming from on the Internet nowadays? Look in the mirror. Online businesses are increasingly finding revenue in capturing content from users like you. Companies are making money by providing tools and services that let you write stuff, take pictures, organize your information, and publish it to the Web.

You want to know where the big money is coming from on the Internet nowadays? Look in the mirror. Online businesses are increasingly finding revenue in capturing content from users like you. Companies are making money by providing tools and services that let you write stuff, take pictures, organize your information, and publish it to the Web.Blogs are, of course, the biggest example. According to a recent Nielsen/NetRatings study, blogs have grown more than 30% since January, and almost 20% of active Internet users visit blogs regularly. Traffic to MSN Spaces grew almost 10-fold during that period, while Blogger got 45% more visitors since January.

The most popular blogs (like the raunchy news humor site Fark.com, which grew 63% this year, according to the study) resemble professional Webzines, with advertising revenue and staff who are compensated for their work. But the overwhelming majority of blogs aren't businesses at all. They're written for a dozen or two friends and associates of the author, filling the readers in on the events of the author's personal life or some special-interest subject that the author shares in common with his readers. For every one professional blog out there, there are probably 10,000 of these little personal journals, and they're where most of the growth in blogging is coming from.

Still, even though the overwhelming majority of blogs aren't business, providing the technology to run the blogs sure is. MSN Spaces is, of course, run by Microsoft. Blogger has been owned by Google since February 2003. Six Apart, which runs the BlogSpot and LiveJournal blog-hosting communities and provides Moveable Type blogging software, has 80 employees, offices on three continents, and funding from Neoteny and August Capital.

Other examples of businesses getting money from user-created content:

Photo sharing: Flickr was a relative latecomer to the online photo-hosting game. Sites like Snapfish had been in business for years, allowing users to share photos with friends and family, and order prints. But where Flickr is different from the competition is that Flickr is optimized for sharing photos online; its Web site is easier and more fun to use than the competition. The photos themselves are sized just right for viewing onscreen, and the site uses nifty technology like AJAX and Flash to make organizing and viewing the photos in groups a snap. (Want to see my photos?)

Flickr was bought up by Yahoo in March.

Getting organized: Another area where businesses are generating revenue from user-created content is in selling you online tools and services for organizing your stuff. Del.icio.us is an online bookmarking service that's getting popular in the geek community. It lets you post your bookmarks to a Web site, so they'll be accessible from any computer, and share those bookmarks with other del.icio.us users. Instead of organizing your bookmarks in folders, you use "tags" to describe what they are; for example, I tagged this review and explainer about del.icio.us with the keywords "bookmarks del.icio.us delicious iwk social_software social_bookmarking." Click on the "del.icio.us" tag and you'll find all the bookmarks I tagged with the keyword "del.icio.us." Click again and you can see all the bookmarks that all del.icio.us users tagged with the keyword "del.icio.us."

Del.icio.us is not only a bookmarking service, it's a research tool.

Yahoo recently introduced My Web 2, a service that incorporates many of the features of del.icio.us.

Getting organized: Backpack is an online service with a devoted cult, allowing users to gather to-do lists, calendars, photographs, and research materials for projects all in one place. 43Things allows users to write down their goals, share them with other users, find other users with common goals, and provide mutual assistance. Amazon.com is an investor in 43Things.

(The Christian Science Monitor has a good article explaining 43Things.)

Social networking: Not all that new, but worth noting as part of the trend. Sites such as Google-owned Orkut and LinkedIn let you build networks of other people, for business purposes, friendship, or romance. The MySpace service combines social networking, blogging, photo sharing, and online forums; Rupert Murdoch's News Corp. purchased MySpace's parent company, Intermix Media, for $580 million (sparking fears by MySpace customers that the new owners would stifle the free spirit of the site, which often contains heated criticism of News Corp.'s Fox News).

What it all means for businesses: The businesses that get into capturing user-created content are weird hybrids. They're like software vendors, in that they need to provide powerful, usable tools. They're like E-retailers, in that they make their money off consumers on the Internet. They're like publishers, in that they display writing, images, audio and video.

They need to combine all those skills with good customer service.

And something that goes beyond customer service: Community service. The successful user-content site will find that its customers take a proprietary interest in the business. The customers feel, rightly so, that the business was built on their work, and therefore the customers own the sites, as much as the investors, management, and employees do. News Corp. is learning that lesson on My Space.

These business won't just make money. They'll also improve society.

How so? Well, up until the 20th century, everybody was an artist. Television and movies didn't exist, so if you wanted entertainment, you had to make your own music, dance, read to each other, or tell each other stories. If you wanted music at a party, someone had to be able to make it. As the last century rolled on, television, movies, radio, and recorded music penetrated more of the world, and we started thinking of art as something professional artists did.

Some of us played music and sang, but most of us went to the store and bought music retail.

User-created content helps the world get off its collective sofas, turn off the TV, stop being passive consumers, and start creating stuff again.

Related Blogging Links:

Look Who's Blogging How five executives, including the CIO of the state of Utah and a VP of engineering at Disney, got blog religion and are using it to their professional and personal advantage.

Blogging Tools Start To Catch On In The Business World Tools must adopt more traditional workflow mechanisms if they're to take root in business settings.

Blogs Now Mean Business Blogs aren't just for blowhards anymore. We review five blogging packages that can suit a range of business sizes and budgets.

Blogging About Work? Play Nice There's a tsunami building, fed by a combustible mix of incredibly stupid (and apparently mean-spirited) workers, public blogs, and nervous companies. I'm referring to the growing numbers of folks fired or reprimanded in the workplace for either exposing company plans or posting negative comments about co-workers in public blogs.

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