User generated content isn’t a new business model or anything, but it seems to have become one of the most prevalent models in this era of the web and it’s interesting to me to see how different companies are having varying successes with this technique. I thought it would be interesting to look at the higher profile companies that are venturing towards this model and whether or not they are having an impact in my life on the web.
When attempting to base your business around user-generated content the main question that you have to ask is why would users want to place time into a site and help build up something they don’t own?
Now I only get to look at Squidoo first because Mike did a great comparison between Squidoo and 9rules yesterday. Backed by marketing guru Seth Godin (Purple Cow, All Marketers Are Liars), Squidoo seems to be getting the cold shoulder from heavyweights (did I just fucking say “heavyweights”?!) Jason Calacanis and Mike Arrington (maybe because he didn’t invest in it…*runs) because it doesn’t seem to be anything close to a success and many people have given their reasons why.
Asking the question why would a user want to participate on the site the answer isn’t immediately apparent. You get to create content on a subject that you are interested in (*cough* blogs *cough*) with the potential of making some money (highest paid lens’ make $30/month). Not really the enticing features you would expect from a site that depends on user-generated content. Can readers edit the content? No. Is there any interaction between Lens Master? No.
From what I have been reading the general consensus seems to be that Squidoo is doomed for failure unless they make some drastic changes. You would like to hope someone of the caliber of Seth Godin can pull this off, but it seems to be lost in too much old-school thought to be able to bounce back. I would simply start off by making Lens’ a collaborative effort so multiple experts can focus on one subject instead of 10 experts focusing on the same topic 10 different times.
One of the most well-known ventures in user-generated content, Digg succeeds because it doesn’t attempt to keep the user-content to itself, but simply share it with the masses looking to find the user-generated content they are interested in. Nothing any different than Slashdot or Fark besides the fact that anyone can post and through democracy anyone has a chance of rising to the top.
Users want to get involved because the site involves them as a community and is actually helpful to them in their quest to finding stuff. This does not necessarily equate into quality content though over time due to the ability of anybody to participate.
Taking parts of Digg, parts of blog networks (users can create full-blown blog style entries), and mainstream media generated content, Newsvine is looking to mix the best of all worlds into one, but unfortunately will suffer from their negatives as well. When user-generated content isn’t controlled in some respects (ala Slashdot) the quality is bound to diminish and I’ve heard rumblings that Newsvine is already walking down that path. Also, hoping that users create original content on a site they do not own means you have to find something more enticing than if they did so on their own site and I think Newsvine has that potential because of one simple thing: traffic.
If anything, users will be enticed to post original content just to be read by more readers than if they posted on their own site. They are also able to use Newsvine as a springboard to their own success. Build up a following on Newsvine (assuming the traffic is large enough) and then move over to your own site. Good for the user, bad for Newsvine, but you would think that for every great writer that leaves another one will take their place. At least you hope…
Did I mention this success seems to be happening even before they have offered any type of monetary incentives? Squidoo’s main case to write on their site used to be the money, but once it was shown that you make more recycling bottles and cans they pulled that angle back. Newsvine doesn’t give you a dime (but plans to in the future) and yet is able to get people to continually produce content for them.
Finally, we must remember that Newsvine is not totally dependent on user-generated content as they still act like any other news site with information from major news sources.
I am not referring to networks such as WIN or Gawker since their writers are paid and I consider them as employees and not users. Most Networks seem to use a percentage-based model where the writer gets X% of the revenue their content earns. Same model as Squidoo in a sense, but you hope to make a bit more than you would over there. You still have to answer the question though of why would anyone want to jump into this model when they could start a site on their own and earn 100% of what they make along with keeping everything they have created?
Well like Newsvine, if you can get behind a network that has large enough traffic it’s quite possible to earn more from a network site than an independent site and in the end you can still jump ship and take your audience with you. Unfortunately I can’t think of any network that has this advantage yet so that leaves money as the main advantage and once money becomes the motivation you are doomed.
What makes great content great is the passion behind it. It’s not the money or the traffic because once the amateur leaves and the professional enters the building many times the quality disappears.