does appear, evidence suggests that its impact will be truly negative. When Facebook has attempted to turn the social graph into a profit center in the past, it has created ethical disasters.
A famous example was 2007’s Beacon. This was a suddenly imposed feature that was hard to opt out of. When a Facebook user made a purchase anywhere on the internet, the event was broadcast to all the so-called friends in that person’s network. The motivation was to find a way to package peer pressure as a service that could be sold to advertisers. But it meant that, for example, there was no longer a way to buy a surprise birthday present. The commercial lives of Facebook users were no longer their own.
The idea was instantly disastrous, and inspired a revolt. The MoveOn network, for instance, which is usually involved in electoral politics, activated its huge membership to complain loudly. Facebook made a quick retreat.
The Beacon episode cheered me, and strengthened my sense that people are still able to steer the evolution of the net. It was one good piece of evidence against metahuman technological determinism. The net doesn’t design itself. We design it.
But even after the Beacon debacle, the rush to pour money into social networking sites continued without letup. The only hope for social networking sites from a business point of view is for a magic formula to appear in which some method of violating privacy and dignity becomes acceptable. The Beacon episode proved that this cannot happen too quickly, so the question now is whether the empire of Facebook users can be lulled into accepting it gradually.
The Truth About Crowds
The term “wisdom of crowds” is the title of a book by James Surowiecki and is often introduced with the story of an ox in a marketplace. In the story, a bunch of people all guess the animal’s weight, and the average of the guesses turns out to be generally more reliable than any one person’s estimate.
A common idea about why this works is that the mistakes various people make cancel one another out; an additional, more important idea is that there’s at least a little bit of correctness in the logic and assumptions underlying many of the guesses, so they center around the right answer. (This latter formulation emphasizes that individual intelligence is still at the core of the collective phenomenon.) At any rate, the effect is repeatable and is widely held to be one of the foundations of both market economies and democracies.
People have tried to use computing clouds to tap into this collective wisdom effect with fanatic fervor in recent years. There are, for instance, well-funded—and prematurely well-trusted—schemes to apply stock market-like systems to programs in which people bet on the viability of answers to seemingly unanswerable questions, such as when terroristevents will occur or when stem cell therapy will allow a person to grow new teeth. There is also an enormous amount of energy being put into aggregating the judgments of internet users to create “content,” as in the collectively generated link website Digg.
How to Use a Crowd Well
The reason the collective can be valuable is precisely that its peaks of intelligence and stupidity are not the same as the ones usually displayed by individuals.
What makes a market work, for instance, is the marriage of collective and individual intelligence. A marketplace can’t exist only on the basis of having prices determined by competition. It also needs entrepreneurs to come up with the products that are competing in the first place.
In other words, clever individuals, the heroes of the marketplace, ask the questions that are answered by collective behavior. They bring the ox to the market.
There are certain types of answers that ought not be provided by an individual. When a government bureaucrat sets a price, for instance, the result is often inferior to the answer that would come from a reasonably informed collective that is