Exploring attention markets

I blogged about Digg clones before and how they failed to understand the true economics behind services like Digg: attention markets.

Here is a new startup from the Ycombinator (Wintor 09) that begins to explore different market structures for attention markets.

The voting on thesixtyone is combined with some concepts learned from video games. Listeners cannot just indiscriminately heart up any song they want. They are given a limited number of heart points on a daily basis. More points can be earned for identifying good music early or recruiting friends to the service. Songs can only be given positive heart points, however. They can’t be demoted for being really bad. But the fact that the number of points are limited means in theory that only the most deserving songs will get enough to make it to the home page or the top of any given category.

Their experiments will be interesting to watch: to learn about different market incentives, to see what strategic variables will truly matter in attention markets. I think learning from games is a great start. Games have always been about managing scare resources (which is what attention is): how they create artificial scarity, how they link resources to encouraged actions et al. Hence, applying games mechanisms to attention markets is a good start for experimentations.

A related post also talks about how the lack of down voting distorts incentives for attention markets. This is again another learning in how attention markets and their efficiencies are shaped by market structures. If attention markets are going to be important in the coming age of abundance in content, we need to pay attention to how these markets work.

Next step: self correcting markets.

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Posted in: idea generation,marketplace