Writing about the Blockchain - part 3
Writing about Content Monetization
Ruminating about the current project: So once upon a time... Like, many people upload their cool videos on YouTube, and it was all fine and innocent until some of them decided that they are cool enough to make some money off that. And they started creating channels, adding more videos about their various activities like cooking or gaming or other stuff, gaining scores of viewers. And they were like, "Let's place some ads on those videos and make some cool AdSense profit." And they did, and most of them - probably except Psy - were disappointed because those profits turned out to be not as lucrative as most of them thought. Like, there was a guy who uploaded videos of him fishing. Finally, he made a hundred dollars during three years of fishing and videotaping the process. So it was decided that ads suck, plus they are annoying and distract the audience from the real stuff.
And people started thinking how else they could fill their pockets with crispy banknotes, cashing on their ability to create fascinating video footages of the stuff comprising their daily lives - particularly the parts they were most passionate about. Like, there are other options. For example, you can sell your own stuff; you shoot a cool video of you cooking cakes. And at the end of the video, you kinda wave in the air some freshly baked cake and say something like: "And for those who are interested, our catering service provides our cakes for various weddings and other important milestones of your life that can be emphasized and made unforgettable by our freshly baked and delicious cakes." Stuff like that. This is the first option that seems plausible. Another option is to find some sponsors. Like, you have a YouTube channel that's pretty cool and has a lot of viewers (like Smosh), and you already have a studio, and you do cool montages, and overall you spend most of your time working on those videos. Like, you've already quit your day job, and now you are in a bind because, despite the huge audience, YouTube ad revenues account almost to nothing. So you think about sponsors and you come to some guys who sell, say, some tee shirts, and you are like, "You know, I hugely like those tee shirts of yours. I actually wear them now and then, and I have this YouTube channel with a bunch of subscribers. And what if I add some message to my videos about your tee shirts, and you give me some money for that, how does it sound to you?" So, yes, this is the second viable option for YouTubers with a sizable audience and influence.
What comes next is relatively new. We are used to the fact that we watch most of the content on the Internet for free. Especially, the content generated by random people. It's kind of logical; why would I pay for anything like that. But this eventually comes down to a traditional model of content creators trying to generate revenues from ads. Which actually works poorly for everybody and doesn't make much sense. Viewers are compelled to watch some ads not in any way related to the original content, and content creators don't make much off those ads anyway. Marketers and brands don't benefit from this situation either because according to recent researches ads don't really work.
So we get down to reconsidering of the whole concept of the free Internet content, and there are several trends of how this monetization roadblock can be bypassed. One of the relatively new principles in this area is based on the centuries-old tradition of rich people becoming patrons of impoverished creators of art, music, literature, and stuff. This concept was tested on platforms like Patreon, and it turned out, that - although it still isn't something that allows every creative unemployed loafer making a living by pursuing their passions and stuff - the idea actually works. At least, it works much more efficiently than context ads, AdSense, and similar stuff. The concept of patronage is closely linked to the concept of donations. I was thinking about how the stream of possible donations is hindered by the banal inconveniences of conducting online payments. Like, it takes only one subtle move and a click to like or upvote something, while it takes much more moves and clicks to make a donation. And this situation kinda hints at certain possibilities. For example, on Steemit the very process of liking is somewhat monetized. When you like something you automatically transfer some minuscule amount of your funds to the creator you've liked. Since there is no option to like anything for free, you either like something, at the same time agreeing to give a small donation to the author or don't like anything at all. The latter is also not a good option for those who create something themselves and might expect some attention and reciprocity. After all, when you like something you attract attention to yourself, and it'll be more likely that your posts will be liked in return, and you'll gain more followers. With this monetization twist, this whole process gives the creators, who have already reached a certain popularity, an opportunity to start earning some money.
So the essence of the project in question, the way I understand it, is that it combines those two approaches of content monetization, that of Patreon and Steemit. The startup is planning to work with video content, and it allows creators using both schemes: They can seek patronage and earn money, creating the patrons-only content, plus they can earn through likes-donations. In this sense, the platform is going to be very similar to the Steemit token economy. Several doubts and questions that immediately arise are related to the fact that the project is apparently going to compete with Patreon, which is already a well-established platform, and it can also host videos. And at the same time, it's going to compete with YouTube that also recently added a possibility for viewers to make donations to the artists they like. Still, maybe, the project will take advantage of the convenience of token economy, in which when you transfer money, it doesn't really feel like you transfer money, or I dunno. The project doesn't have in its plans many things to speak of, a couple of technical details like CDN network with quality ratings for CDN nodes (Although, YouTube apparently uses CDN too, so it doesn't sound like a huge advantage either)
Writing about Blockchain Freelance Marketplace
Ok, ruminating about this next project. Here, as a context, we have the gig economy where people's professionalism is measured not by their diplomas and degrees, but by the set of tangible, practical skills and accomplishments. There are two existing parts of this ecosystem:
Online education platforms like Udemy or Coursera, where all the possible human knowledge and skills are split into short chunks, digestible in the course of a month or less. It makes sense because in this pragmatic world it might feel like the classic model of formal education gives a lot of things the students don't actually use after graduation. This is some kind of ballast. While it can be valuable as the general knowledge or like some decoration, showcasing a cultural level of a person, in the modern world, driven by quick, pragmatic decisions, nobody actually can afford to spend time, learning something they are not going to apply immediately.
Another part of this ecosystem is freelance job markets like Upwork, as well as full-time job portals and headhunting platforms. One of the problems in this sphere is how to evaluate the skills and professionalism of a candidate. While recruiters still widely use resumes and CVs to assess the potential hires, there is also a perceptible shift toward using more reliable and objective metrics. The thing is, the CV contains what I put in it. Certainly, I consider myself highly qualified in whatever area I choose to seek employment, but this is also my subjective perception. In reality, it might not be so. So currently the candidates' portfolios and references to previously done projects are considered more reliable sources of information. Unfortunately, this approach is only applicable to certain work spheres. If I work in web design, programming, or, say, write articles, I can compose a portfolio of my previous works, many of which can actually be on the Internet. It's less likely that I'd be able to do that if I'm an electrical engineer or, say, PR manager. My work, in this case, doesn't leave such a tangible trace that can be stored to confirm my professional level in the future.
Plus, there's another catch. Many people who just recently acquired some new profession, (like, they have finished some courses or something) are not considered too seriously on the job market. In absence of any other point of reference, work experience is considered a key metric, defining a potential candidate's level. Meanwhile, he/she can already be well qualified at this point, like, having some natural talent for a certain profession. The problem is, there are no reliable metrics that would allow confirming the qualifications of the recent graduate. (Plus, the fact of the person's finishing some courses isn't enough to determine whether this person really got a handle on the craft or not)
So the platform X intends to combine those two parts of Gig economy - education/employment ecosystem - and create an integrated infrastructure, where people are guided through the process, starting from them acquiring skills and knowledge via educational programmes, (like at Udemy or Coursera) and finishing with them being employed in a process, similar to that of Upwork. All the users' "career" trajectories are recorded on the platform, attaching to them certain metrics, measuring users' performance.
The platform paradigm includes four cornerstones:
"Acquiring skills." (through courses, training, etc.)
"Contextualizing skills," which basically means figuring out ways to apply them. For example, I can get a degree in marketing, and I can apply this knowledge in many different ways, from developing a marketing strategy for a company to writing promotional slogans or designing logos. In fact, I may combine various courses in a way that would boost my performance in doing my particular thing. Like, I can choose a certain central skill, defining my market value as a professional, and then put layer after layer of knowledge and additional skills around this core, improving it. (For example, if I'm a writer, the practical knowledge of philosophy can help me to add some depth and contextual understanding to anything I write.)
"Applying skills." Here the platform emphasizes the importance of the direct connection between learning and immediate practical application of newly acquired skills. Architecturally, it's realized through practical challenges offered to students by the companies using the platform to find potential talents. The challenges, if successfully solved, allow students to gain qualification points that, in turn, define their overall rating in the system. Additionally, such challenges can bring actual monetary rewards.
The fourth cornerstone is called "Skill boosting," and it's somewhat a result of the successful application of previous three concepts, plus an ideology of acquiring and combining skills, with some central professional objective in mind.
Ok, what else can be said about the platform? Another interesting thing is that it grew up from a different curious startup Workkola that already has about 17k users and 2k companies working with it. The X project's key principles came from Workkola's paradigm as well. The main idea is that platform user build his/her personal brand, confirmed by various objective metrics the system gathers during the process of user's learning, solving tasks and challenges, and doing the actual work. This way, all user's actions within the ecosystem lead to him/her accumulating reputation, expressed in measurable metrics. Additionally, the platform has a matching algorithm, allowing users to find tasks they are most qualified to do, based on the set of skills, acquired at the platform, and their previous performance. Equally, recruiters and companies can use those algorithms to find people most qualified for certain tasks. (Here again, the paradigm of Gig economy - people are hired to accomplish a specific job, as opposed to just filling a position.) So, yes, metrics, challenges, allowing precise measurements of worker's qualifications, task-candidate matching, personal brand.
Another talking point is the seven key principles of the X project's platform, three of which make sense and worth mentioning.
First is the "meritocratic ideology." In other words, the platform doesn't evaluate its users in any other way except by their qualification score, measured objectively based on their performance. All measurements are done by machine algorithms, so they cannot be in any way subjective. The whole concept is called "Proof-of-Skill." Also, all the results are stored on the blockchain, which adds to this mechanism an additional degree of reliability.
The second concept is "The Distribution of Power." It means that the platform doesn't have a central authority. It's controlled by its users and algorithms. This approach applies to any strategic decisions, like implementing a new platform functionality. Also, it means that any processes of ratings and user skills' evaluation are done based on the majority vote of multiple "Raters." Raters, in turn, stake their own "Proof-of-Skill" and reputation on their votes. In a sense, that if their vote is different from the majority vote, they lose reputation points, defining the level of their own qualification. Since Raters don't know the vote results in advance (Or how any other of Raters voted) they are motivated to base their decisions on a thorough analysis of the subject. (A proposed solution for the task, for example.) They can also gain additional points by writing reviews and comments, explaining their decisions.
This principle of Raters assessing user's performance, without knowing what other Raters think, is also what defines the third principle of the platform "The lack of bias." In such a setup, individual decisions cannot be influenced by, say, the majority opinion, or some figures of authority.
By the way, in the blockchain ecosphere, such figures, providing external information to Smart Contracts, are called "Oracles." For example, the decision - whether a user has passed a test or not is made through a Smart Contract. The Smart Contract itself cannot make this decision. It requires some information from the outside, which would give it enough data to make a certain resolution. Ideally, the evaluation of user's performance should be conducted automatically as well; it would guarantee that the result of such evaluation doesn't contain any bias. Unfortunately, for example, to give a quality assessment of user's solution to a problem is not always a surmountable task for the algorithms. When the human opinion is necessary, the second best approach, apparently, is the system in which the final decision is based on the consensus of the expert majority. Experts (Raters) act in this scheme as "Oracles," and their own reputational stakes motivate them to base their decisions on a thorough, quality analysis. (Otherwise, without having any other guidelines they run the risk of voting against majority vote and losing their reputation points)
New Projects and the Memory Palace Technique
Ok, to sum things up, the X project is a mathematically heavy concept of a possible alternative to Ethereum. Here, I think, would be appropriate a comparison of this situation to the David versus Goliath battle. Nevertheless, however ambitious and unrealistic this project's goal is, the outline of problems and possible solutions they offer makes sense (Maybe, on the regional level anyway)
So, the key points are the following:
Ethereum platform and network's main purpose is mainly to support blockchain applications (dApps) built upon it. Ethereum architecture with its "gas," Smart Contracts, and an ability of participants to issue various app specific coins is well suited for this purpose. Although there are two key problems that aren't solved yet, plus they are sort of intrinsic, they emerge from the blockchain core architecture and particularly its implementation by Ethereum.
The first problem is the ubiquitous slowness of the blockchain transaction confirmation process and a huge amount of computational power and electricity needed to execute the "Proof-of-Work" protocol procedures. Also, it's worth mentioning that all Ethereum dApps operate, using the same transaction sequence (Like, transactions of one dApp need to wait until transactions of another dApp are confirmed, they form a single line.) It means, that applications are not isolated from each other and, as a result, delays, bottlenecks, and user request overloads in one dApp affect all the other applications, operating on Ethereum. (See CryptoKitties) In some way, it's an architectural flaw.
Another less frequently mentioned problem is the problem of "Oracles," in other words, the trustworthiness of external information, supplied to the Smart Contracts. There is this "single weak chain link" problem. The functioning of Smart Contracts on blockchain is secure and reliable beyond question; this high level of reliability is ensured by the very principles of their architecture. The only problem is that Smart Contracts need external information to make their decisions. For example, if a money transfer to the supplier is triggered by the fact of successful delivery of its product, information about the delivery is received by the Smart Contract, responsible for this operation, from outside. And it raises the question of trustworthiness of this external source of data. Let's assume that the source of information is reliable; there are still several problems related to the channel between the source and blockchain. Namely, the information can be intercepted by hackers, altered, and sent to the Smart Contract in this distorted form. Or it's possible that some malicious actor will impersonate a reputable data source and send false messages on its behalf.
So the project X addresses these two problems quite radically, proposing its own blockchain architecture as a possible alternative to Ethereum. A brief recital of all its technical peculiarities gives us the following list:
The platform uses cloud services to host its decentralized ledgers. It raises the question, how decentralized those ledgers really are. One of the key elements of blockchain technology is that blockchain normally doesn't have a single point of storage. It's distributed and replicated on multiple nodes of its network. This cloud storage alternative doesn't really align with this ideology, but anyway.
The platform uses so-called "namespaces" to isolate transactions of different dApps. In fact, it turns the whole thing into a multitude of small blockchains that are not really connected to each other. Nevertheless, it probably can prevent the ecosystem from being affected by a single application, experiencing transaction overload. The way it happens on Ethereum.
It uses a special intermediate layer to provide a buffer between external data and Smart Contracts. Essentially, the problem of external data reliability is addressed in the following way: The system receives data from several sources that either confirm each other or not. If information from different sources is contradictory, the intermediate layer utilizes a lot of mathematical mumbo-jumbo to decide what data is correct. (The list of mathematical mumbo-jumbo includes Threshold cryptography (TC), Nash Equilibrium, median voter theorem (MVT). More on that later.)
The system uses so-called "transaction batches." This is supposed to somehow "lighten" the transaction confirmation process. Like, confirmation is performed for batches rather than for single transactions, which makes the whole process faster. (Although I haven't completely understood how it works yet, essentially it has to do with off-chain operations)
The system uses the "Proof-of-Elapsed-Time" (PoET) principle to ensure transaction validity, blockchain integrity, to prevent DoS attacks, and similar stuff like that. While PoET is described as a slight deviation from the traditional "Proof-of-Work" principle (with an addition of some of "Proof-of-Stake" concepts), it's somehow based on its key principles. The difference is that as opposed to the "Proof-of-Work," it doesn't include those heavy calculations, which eventually allows the platform X to claim that it's much more scalable and capable of handling industrial-level amounts of transactions. Ok, more on that later.
So, Ok, I'm going to apply this memory palace technique to fix in mind twenty key technical features of project X. The way I managed to put it together, it looks like some sort of amusement park.
Right after the entrance, there are rows of various clay mugs and other clay handiwork. This is something like an exhibition of clay art. Some exhibits are broken, and the shards of clay are scattered around. So the first platform's feature is "sharding," meaning that all system's operations are distributed among clusters of its nodes.
From this point, I can also see some magnificent roller coaster towering towards the sky somewhere at a distance. The rollercoaster naturally represents the system's APIs and mechanisms responsible for integrating with third-party apps and interfaces.
Right after the clay exhibition stands a treadmill. So to pass this part of the route I need to outpace the treadmill. The treadmill, running backward, symbolizes the third project's feature, "rollbacks." Namely, it is capable of rolling back transactions in case of errors and fraud. There are some intermediate states, through which transactions pass before completion, and if the operation is in one of those intermediate states, it can be rolled back.
Ok, the treadmill butts against a big slab of ice. It's literally an ice wall, and there's a narrow passage through it, leading to the other side. The ice wall represents an ability of the system to "freeze" users' wallets in case it's needed for security reasons or whatever. Like, blocking a credit card basically.
On the other side of the ice-slab stand weird and creepy mannequins. I don't know why, but this is a mental picture, consistently associating in my mind with biometric data. So, yes, the project uses biometric data for authentication and stuff.
Ok, after the mannequin exhibition, there's a valley, crisscrossed by highways. The valley and the highways symbolize an ability of the platform to communicate and interoperate with other ERC compatible blockchains. (This metaphor covers two items on the list: inbound and outbound compatibility)
At the end of the valley stands a giant statue of a Viking holding a sword. The Viking monument represents a key transaction confirmation principle of the platform "Proof-of-Integrity." The Viking has some integrity, naturally.
Behind the Viking-statue is a concrete wall. There are metal gates at its center with a red sign "Access Denied" attached to them. This route point covers two platform features, intended to provide enhanced security of transactions and wallets. Without getting into technical details, that I don't remember anyway, those features primarily address protection of specific nodes on the network.
Passing the gates, we bump into a table with a cup of coffee and acid pills scattered upon it. Cup of coffee symbolizes integration of Java programming language into the platform architecture (its Smart Contracts to be precise). Acid pills represent the ACID principle of system's transactional model. Atomized, Consistent, Isolated, Durable.
On the opposite side of the table stand Oracle representatives in dark glasses and business suits, holding signs "Transactions" and "SQL." In my mind Transactions and SQL are mostly associated with Oracle because I mostly worked with Oracle. So, Oracle.
At the end of the park, there is an incomprehensible maze symbolizing the project's feature called "Full Route Data Flux." I wasn't able to figure out technicalities of this thing so far, so here's this mysterious and convoluted labyrinth.
So, eventually, putting together the outline. The project X raises a question of how well the current blockchain architecture suits those complex organizational problems, it claims, it is capable of solving. Since the inception of this tech, there are endless talks, how it's going to redefine and reshape everything related to organizing and tracking processes. Like, governmental procedures and businesses logistics. Delivery of goods and payment systems. Technically, those claims are not unsubstantiated. The blockchain tech in effect combines several existing technological concepts, namely cryptography, open-closed key pair principle, and decentralized data structures, particularly decentralized ledger technology (DLC)
The first question though that pops up in my mind, (from the point of view of a person who spent a decade automating business processes through databases) like, how those complex organizational and business data structures can be organized in the linear structure of blockchain ledger. Like, business processes are much better reflected in complex database structures, having multiple entity types, tied together with connections. (In other words, what we call a classical model of the relational database) Or to put it differently, all those organizations and processes that will allegedly be targeted by blockchain tech already effectively use the relational database paradigm to optimize and automate their functioning for a couple of decades. If the blockchain is a new word in process optimization it still has this huge downside in the form of its simplicity. Like, if I have a database, supporting logistics in my company, and it has like, a couple of dozen of tables and relations between them. And then somebody would tell me like, that I need to redesign it, so it could be organized as a single linear set of records (blockchain) without losing its functionality. I'd say it's ridiculous, and there is no way to do that.
Really, the blockchain, while addressing certain problems related to data integrity and immutability, as well as security and robustness of the system, (which is achieved through ledger architecture, principles of decentralization, and intrinsically reliable transaction confirmation protocol) it totally overlooks other aspects of the environment that it's intended to improve. Namely, the complexity and interconnectedness of business processes, containing multiple entities, connected to each other in multiple ways. In other words, those are the complexities that are currently perfectly tackled by relational databases.
So the question that naturally comes to mind is why not just to crossbreed blockchain tech and RDBMS tech. And benefit from the advantages of both. This is what project X actually does. Essentially, it approaches the matter pragmatically. Currently, there's a lot of hype, pipe-dreams, and wishful thinking about how the blockchain is going to change everything. But the truth is, blockchain has its limitations, even more so, it's designed to solve a limited set of very specific problems. To address a broader problem of process automation we need an architecture combining features of classical databases (that already proved their efficiency in dealing with that task) with elements of the blockchain design that would increase the level of security, reliability, and trustworthiness of such a system. Similarly, there's a need to address intrinsic ailments of the blockchain, including low processing speed and scalability, a huge amount of energy and computational resources it uses to process and confirm transactions, and a certain rigidity, showing for example in its inability to rollback transactions.
So, Ok, the project X builds a new data architecture, somewhat combining the elements of blockchain and relational databases. Enumeration of key project features gives us the following:
It uses sharding to distribute its operations among node clusters, adding an element of parallelism to transaction execution.
It allows to rollback transactions, which makes it possible to actually use it in the normal payment processing systems.
It allows freezing users' wallets if necessary, which is a mandatory security element of any half-decent banking system
It uses its own original "proof-of-integrity" protocol for transaction confirmation, which solves the problem of transaction delays and resource heaviness of the traditional "proof-of-work" protocol.
It's compatible with other blockchains and has tools to connect and exchange information with them.
It uses biometric data to increase the level of user security. This is a good approach to the ubiquitous problem of private keys safe-keeping. In fact, private keys are the "weak link in the chain", regarding the whole model of blockchain security. Meaning, that it's not that difficult to steal private keys, or coax a user to give them away. (All it takes is to get access to the user's laptop, which is not that difficult)
It uses some two additional security protocols I'm yet to figure out. But they are awesome.
It uses ACID transaction paradigm: atomized, consistent, isolated, and durable transactions. Although it's somewhat a banality, it sounds pretty cool nevertheless. Especially the word Acid.
And yet again Influencer Marketing
Ok, once again, Influencer marketing. Like, we know very well that ads don't work, and we need a healthy alternative to ads. Like, something more authentic and believable. So we go on social networks, and see our friends and other celebrities, saying something along the lines, "I bought this super duper thing, and it's so amazing, my life literally has changed forever." So this is the influencer marketing. It's not much different from ads, but it looks more authentic and honest. The main problem with this project is that I wrote about this thing so many times already, and now it's hard to figure out what else I can add. Ok, the main message always was: Influencer marketing needs a platform that would allow organizing this haphazard process into something structured and systematic. Solving problems with payments and all that. Helping marketing agencies and bloggers to find each other. Also, ensuring that nobody scam nobody, so we have those escrows, automatically triggered smart contracts, arbitrage panels, and participant ratings.
Essentially, each such project is based on the comparison of Influencer market in its raw chaotic form (with them intermediaries, scammers, uncertainties, and technical inconveniences related to payments) with one organized through some kind of a platform. The key difficulty is to find something interesting and unique about a particular platform, something that makes it different from multiple other similar projects. Another difficulty is an introductory paragraph where I need to say something about Influencer marketing without repeating myself. (And I wrote about this topic three or four times already.)
Maybe, it would be easier to start with discerning unique project features and then to form an introductory part in relation to those features. What do I remember so far in regard to what this startup in question does? Like, it's another content marketplace where all its participants are encouraged to write some kind of promotional stuff, rate promotional stuff, and reap monetary rewards. The interaction between promoters and their clients is organized through reliable and secure mechanisms, preventing any of them from bailing on the other party, cheating, and all that. The platform also has features that might be orgasm-inducing for marketing analysts. Like, the system of reporting that tracks various marketing metrics and evaluates the effectiveness of the campaign. "Insights," a universal feature that can be used both by marketers and influencers. This is something like a tool for market and trend assessment or something like that. The thing is, it allows marketers to develop effective strategies, and, at the same time, it's somehow useful for Influencers as well (I need to check) There's naturally a system, allowing finding people working in specific areas. Or like, to find specialists who fit a shitload of different criteria. I don't know, something like teenage gay males writing about vegetarian food with five years of work experience, something like that. Yes, and the system supports immediate monetary settlements as opposed to traditional payment systems with their delays and problems with cross-border payments. Pretty standard set of features. Also, the platform has a working prototype in its beta stage.
There are several things worth mentioning about Influencer marketing in general. For example, it consists of two parts, one of which is represented by large-scale influencers, having hundreds of thousands of followers and subscribers. Like celebrity level bloggers. Another part includes social media personalities with a small following, narrowly focused on a specific topic, and intensively interacting with their audience. Also, the latter might seem more honest and authentic when they talk about brands and preferences. What's interesting is that according to statistics this kind of influencers is really effective in generating leads. In other words, among their small audiences, a higher percentage of followers are eventually motivated to make a purchase based on Influencer's opinion. So the audience size, in this case, is deceptive since, in the end, its marketing value is higher. It's a dedicated target audience. This leads to assigning a higher value to the "small-scale" influencer marketing in general.
Another crucial aspect of content marketing marketplaces is whether they have mechanisms of content quality assessment. It's important for example in terms of participants' rating. For example, if somebody has a high rating what exactly does it tell me as a client? Like, does it really reflect quality standards that I would consider acceptable? Ok, the project X enforces quality standards through the system of content reviewers. Content reviewers are paid for the correct assessment. And the system is based on the majority vote. Which is interesting. Like, content is graded by several reviewers each of whom stakes tokens on the outcome. Those reviewers who give the content grades significantly different from that, given by the majority, lose their stakes. It motivates reviewers to do a thorough analysis before making a decision, which, in turn, is supposed to ensure the quality of content quality assessment. Ok,
Ok, what if I just start by listing key problems of Influencer marketing and content monetization in general.
Ok, the first entry. There's a concept I see everywhere called "walled gardens." Like, content created within some platform, like a social network, for example, is somewhat trapped there, or it's not really widely accessible to search engines or something. Well, I don't really understand wtf do they mean by that.
Ok, before I forgot, it'll be worth mentioning that the X project works in connection with major social platforms like Facebook and Instagram. Plus, it collaborates with a number of major brands. Or it plans to collaborate with a number of major brands. Whatever.
Also, in the absence of organized ecosystem, it's hard for marketers and brands to find Influencers. Especially, if they look for people who fit specific criteria. Like, Influencers who work in some particular niche, catering to a certain type of audience. And at the same time, they must have a required level of visibility, content quality, engagement, etc. Another associated problem is how to organize communication with those freelancers. Working with freelancers directly, well, it requires figuring out schedules, payment methods and schemes, feedback. Also, there's a question of how trustworthy is the freelancer, and whether there is a guarantee that he/she won't bail on the task at the most critical moment. On the other hand, this organizational aspect can be delegated to special agencies and intermediaries that work with freelance content producers. But the downside of this approach is that agencies take hefty commissions, which can significantly increase marketing expenses.
Another big problem of Influencer marketing is the difficulty of evaluating content quality. First of all, it's a subjective metric, and without any system where content creators' level is quantified in the form of ratings, the only way to determine their qualification is by reviewing and assessing their portfolios. That's a lot of work for a potential customer, who'll need to browse through and examine multiple portfolios. Plus, he might not even have a sufficient level of expertise to determine the quality of content in terms of marketing impact. In any case, this examination will be intuitive and subjective, and not confirmed by any practical marketing figures.
Well, another ubiquitous problem is the absence of reliable, fast, and cheap mechanisms of money settlements. Payment systems take high commissions; it takes a long time for money transfers to be completed, plus, there are additional problems and higher fees for cross-border, international payments. Additionally, there's a problem of trust. There is nothing that can prevent a freelancer from taking the money and bailing on the task. As well as nothing can prevent customers from screwing freelancers after the work is done.
Plus, it's not easy to assess the effectiveness of marketing campaigns themselves. Especially, if it's necessary to track campaign metrics in real-time. Also, even if the company, conducting a marketing campaign, can effectively trace campaign metrics like views, clicks, conversions, etc., it's a somewhat raw data, and not all companies have an ability to effectively analyze this information to answer more general questions. Namely, does this marketing campaign work? Or, which elements of the marketing campaign work and which don't? What can be tweaked, and so on.
Ok, returning to the project X and its team that vows to do a miracle and solve all the aforementioned problems. So, the platform's architecture includes five major parts:
Payment protocol. It stipulates how all money settlements are conducted between marketers, influencers, and reviewers. As anybody might've guessed it's based on blockchain and uses tokens as a means of exchange. (It would be a huge surprise for me if it were organized differently.) In any case, blockchain is well suited for payments, and smart contracts prevent people from cheating on each other. Period.
Content quality assessment protocol: like, some mechanisms and procedures that ensure the quality of content: reviewers, ratings, etc. Well, the project X has the whole category of paid users, specifically tasked with content reviewing and motivated to do their work well. Otherwise, they lose tokens staked on their decisions. Like, essentially the quality of content is assessed by reviewers, and the quality of reviews is determined by the majority vote.
Discovery protocol. A number of mechanisms, allowing marketers finding influencers based on a set of criteria. Like for example, a marketer is interested in finding a blogger, who targets a very specific audience of female, gay vegans in the age range of 15-25, and has a high level of engagement with the audience. Also, the criteria can be age, gender, geographical location, a sphere of interests, etc. It also works the other way; content creators can find clients, using the same set of criteria. Like, somebody who works in their niche and might be interested in creative stuff they produce.
Insights protocol. This thing is somewhat connected to AI tools that according to White Paper this platform developed. In a nutshell, this component analyses data generated during marketing campaigns, like for example, metrics related to user interest: views, clicks, conversions. Also, taking into consideration specific visitors' attributes, like age, gender, occupation, geographical location, or like, whatever information can be extracted when the user clicks on the ad. The platform employs some sort of smart algorithms that process and analyze this information and generate "insights," or some sophisticated and deep conclusions that can be helpful, for example, for planning the next marketing campaign.
Reporting protocol. This is a subsystem that is supposed to analyze the effectiveness of marketing campaigns conducted on the platform. According to the description, it tracks all the campaign's metrics and analyzes and aggregates all that data, providing campaign initiators with comprehensive reports on the campaign status and results. Like, whether it has achieved its desired goals or not.
Additionally, speaking of project's alleged use of sophisticated algorithms, AI, and similar stuff. Well, the project's team claims that they have an automatic language processing system that can analyze users' comments and for example, detect if the comment is positive, negative, or neutral. Ok,
And, once again, this problem of an introductory paragraph. Like, maybe it's less of a problem of an introductory paragraph, and more of a problem of my brain eventually shutting down. And current weather and, I don't know, changes in atmospheric pressure and temperature effectively contribute to this process. It feels like when you haven't slept for a couple of days, and on the one hand, your brain is so wound up that it's impossible to sleep. Like, there's this consistently increasing buzz. And on the other hand, it's hard to think because of this fatigue. So the flow of thoughts is somewhat incoherent and generally useless. Like, the worst possible situation in terms of productivity.
So, nevertheless, it would start like that, "We already discussed the concept of Influencer Marketing in depth, so here's a quick reminder..." Like, bitches, go read the shit I wrote before, I'm not going to repeat myself the fourth time in a row. So, yes, Influencer Marketing. So what the fuck is Influencer Marketing. "Influencer Marketing is a new approach to the promotion of products and brands, which uses as a driving force the opinion of people, having certain popularity and weight on social networks, Influencers. The key difference with advertising is that Influencers base their opinions on a true interest in brands they promote. Usually, they and their creative work are related to a certain niche where mentioning certain brands is relevant. For example, when a popular blogger, writing about a healthy lifestyle, mentions what brand of footwear she personally prefers it sounds natural and authentic. It means, as opposed to advertisements, when Influencers talk about some products their followers perceive it as an honest recommendation. In some way, they might be considered a core of a fan-base forming around a certain product." O_o "Presently the market of freelancers and content creators engaged in Influencer Marketing is in a chaotic and disorganized state, which leads to following problems..." o_O
On Copywriting, Gaming, and Blockchain Economy
It's hard to find internal logic in certain things. To write some consistent description, I need to have a mental picture of how this thing works.
For example, I'm trying to outline the principles of online gaming economy. On the surface, it's pretty simple and can be expressed through a collection of banal phrases. The key message is that the professional online gaming is a field where people are trying to earn money through tournaments, competitions, live streaming, writing manuals, reviews, and articles, creating podcasts and so on.
I took a brief look in this matter and learned another key truth about this field; that it's very difficult to earn money by any activity related to gaming and few people have managed to do that. Many game streamers struggle to gain at least ten followers, and even qualified pro gamers often leave the competitions empty handed since the major chunk of prizes goes to the consistently winning teams.
In other words, reading about something, some platform that would allow its participants to earn money through gaming, I instantly feel skeptical, knowing how difficult in fact it can be.
On the other hand, I'm trying to figure out how exactly this platform changes the existing ecosystem and rules; if it offers something new that is going to alter the situation in a way that it would be easier for gamers and game enthusiasts to profit from their passion, I need to know exactly what it is.
This is the main problem with White Papers. The most comprehensive part of them describes the current situation, and I can see this situation very clearly eventually - its inputs and outputs, and an underlying logic that makes the system able to function and being economically viable. When it comes to describing how this project is going to change and optimize this existing system, it suddenly becomes tricky. The narrative becomes vague and somewhat inconsistent. This is the point where I'm compelled to stop reading and start wrecking my brains.
Until this point, everything has been transparent, somewhat logical, and self-explanatory. Yes, there is an ecosystem that developed around gaming and like everything on the Internet it's a subject to monetization. The key thing here is that this has already happened. All the possible supply and demand were channeled into the infrastructure which has organically formed around separate aspects of gaming activities. Like the twitch platform for broadcasters, gaming magazines for people with an ambition to make a living by writing about games, and tournaments for professional gamers.
So there is no problem with an infrastructure for gaming activities and monetizing them. If somebody comes forward saying that they offer some new platform aimed to facilitate this stuff, I'll assume that they will most likely fail because they don't offer anything new and will have to compete agaist established and successful projects in this field. Unless the gist of their proposition lies in a different plain of this ecosystem.
When I take a brief look at the gaming ecosystem from a different angle, namely from the point of view of the economy, I notice a certain problem, which is an imbalance between supply and demand. For anybody who is trying to break into this sphere cherishing hopes of making a living by streaming or writing about games or participation in tournaments this can be expressed in a phrase "high level of competition." As I personally see it, this is an objective reality that cannot be changed solely by a new platform with new technological gizmos. This is not a technological or organizational problem, but rather economical one. There are way much more people who want to make money off the gaming fandom than the current consumption level can support. In other words, if there are hundreds of thousands of people on Twitch, streaming their gameplay, there is no way for all of them to gain the audience sufficient for monetization. Most likely ninety-nine percent of them will be seen by maybe a couple of other people if they are lucky. Even if every streamer on Twitch provided equally cool and exciting content, there wouldn't be enough resources for them all in the form of time, which viewers would be able to spend watching their channels. In short, there is too much to see. The same situation with game writing, youtube podcasts, and professional gaming. It seems like there are more people who want to be creative participants in this field than passive consumers. Which is understandable.
So after I have drawn this simple mental sketch of the supply-demand problem in gaming, I take a fresh second look at the project in question and its proposition, trying to figure out what it implies from the economical point of view. Their pitch is "We'll make the gaming profitable for the gamers, allowing them to earn money by playing games!" Well, as I've mentioned above, there is nothing new about this idea. A lot of people are trying to monetize their gaming activities. Way too many actually. So I try to include into the equation technological innovations they bring (although, I feel that it's not a technological problem that not everyone can make a living by gaming). I write about blockchain startups, so, naturally, this project too is based on the blockchain, and this is considered to be something that can allow every member of the platform to earn something.
Let's, maybe, take a closer look at what's a blockchain project. It's a closed economy with local currency (tokens) The circulation of those tokens in the system is similar to how the economy works on a grander scale. For example, if I had a supply of tokens on Facebook and each time I liked something a certain amount of token would be transferred to the author of the post I'd liked it would be similar to how such systems work. The catch is that theoretically, those tokens are also redeemable for the real money, which is when the situation starts to get intriguing. Like in this example with hypothetical blockchain Facebook it would mean that I can earn money by posting stuff.
The things that baffle me regarding this model are the following: I don't really see how the money would get into this system from the real economy. Take for example the Steemit blogging platform where participants whose posts have some popularity can earn money because likes they receive have the attached monetary value (Dependent on the "weight" of the user who put the like) Tokens can be withdrawn from the system and converted into money. What I don't understand is how the money gets into the system - the money to supply all those bloggers creating the quality content. Like I don't see any advertisements on the site, and nobody pays any entree fees or anything. It's a closed system where tokens are produced on the blockchain and circulate among its members. It would be a sufficient self-sustainable system if all that I needed in life were reading and writing, but I also need food, and the system does not produce food. So its internal currency needs to be exchangeable for the external currency of the real world, and by some miracle it's possible.
I reason, for this to be possible, tokens in the system need to have some value. For tokens to have value, the system needs to provide some value for players outside the system (definitely quality content is valuable for readers, but they don't bring real money to the platform) As I can see this, the money supply comes at first from investors who buy tokens, expecting that their value will grow. But it cannot be a permanent solution for the external money supply, plus it implies that tokens should grow in value constantly. The investors can just as well sell tokens thus withdrawing their money from the system. And there are no advertisements that would be another sustainable flow of the real money into this closed ecosystem. So far it remains a puzzle to me.
So returning to the question of gaming, its monetization, and how the closed blockchain economy can solve the problem of imbalance of supply and demand, e.g., the fact that there are much more people who want to earn money by gaming than those who want to pay (or watch advertisements) to see their streams, tournaments, and articles. At first glance, it looks like this is a clearly economical problem, so a different technological approach is in no way going to solve it. Although, the blockchain is a slightly different economic paradigm as well if we get to the bottom of things.
In fact, drawing the parallel with Steemit once again, nobody is guaranteed to earn anything on this platform, the rewards for posts come as voluntary contributions depending on the quality of posts. I might assume that the same is going to be true for this gaming monetization platform as well. I picture this as a blockchain analog of Twitch with the majority of participants not making any profits. The difference, as I see it, is the hypothetical ability to start making profits at any moment. Like with Steemit, I can post there for months without getting any likes or get likes that bring about $0.01 on a post (Which is usually the case), but I'm still encouraged by this prospect that one day I'll wake up and learn that I started to make some profits. The difference with the existing systems is that they don't have this direct link between participation and monetization. There are phases like at first, I work on gaining popularity and audience, then when I reach a certain level of fame, I offer my blog or channel as a platform for context advertisements. You decide when you have enough potential and views to try to convert them into money. With blockchain platforms, there is no this distinction between the period when you work your ass off preparing for monetization and the period when you start actively making money. In other words, when you join the platform your presence and everything you do there is already monetized (At least hypothetically).
In fact, there is no actual difference with the existing not-blockchain platforms. If you are a genius blogger or broadcaster, or if you just got extremely lucky you can gain real profits from your efforts (maybe even enough to make a living). If you belong to the other 99 percent of losers, you won't earn anything at all. Just as it always were, no matter whether the platform is blockchain based or not. The difference, as I see it, clearly psychological. There is a thrill in the idea that one day you might wake up rich. In terms of entrepreneurship, this thrill can be exploited as a driving force, powering the activities of platform users. To put it bluntly, they would be driven by greed and naive hope that this system will help them to make a buck eventually because it's based on the blockchain technology. And while their hopes are going to be crushed in the end (Because at this point I fully realize an implacable economical nature of the problem of earning money on the Internet, which is an imbalance of supply and demand) this, nevertheless, will be beneficial for the platform and its investors. To put it differently, we talk here about a technological novelty that can become popular because of its novelty and the hopes people might associate with it.
To sum it up, the article, describing the company X providing a platform for monetization of gaming activities and the context within which it operates, should consist of two main points.
First, there is a huge interest among gamers in monetizing their gaming. Plus many people are passionate about gaming and want to make some money, in the best case to make a living on any activities related to gaming, including streaming, writing stuff about gaming, recording video podcasts, etc. Plus many people think that they are so good at gaming that they can earn money as pro gamers. Like those Champs getting the huge prizes at the World Tournaments. All those pipe dreams are never going to be realized, but the thing is, that they have a certain economic value per se. Which leads to the second point.
The X company, providing its blockchain platform for monetization of gaming (Which frankly won't be that different from Twitch combined with gaming portals and magazines ) offers all those gamers AN OPPORTUNITY to earn money through gaming. An opportunity in this context can be replaced by the word "chance." I might have an opportunity to find a buried treasure somewhere and become rich; it's a totally valid proposition. This platform gives people an opportunity to earn money unless they don't belong to those 99 percent who are unable to monetize their activities on the Internet. (As it always were) In fact, it gives the same kind of opportunity as youtube gives its users regarding their ability to monetize their channels through context ads. In the case of the blockchain project the link between participation and monetization is more direct; signing up at the platform you immediately start monetizing your presence there. The end financial result will be the same as with the traditional platforms for the most, but this presence of constantly boiling internal economy produces a feeling of thrill and a sensation that the money is somewhere at the arm's reach. Which stimulates and encourage participants to be more active and creative, which, in turn, is beneficial for the project and its investors. This is probably the essence of the blockchain projects, which I myself got a taste on Steemit. This feeling of actual money saturating this ecosystem, and some thrill of gambling and a chance to win big. Something like that.
On Marketing and Big Data
After getting this next assignment related to a startup with a short and vague White Paper, where nevertheless could be perceived some bold and scary proposition, I started ruminating about marketing, advertisements, and privacy.
In fact, the very idea of tailoring marketing campaigns and offers to individuals assumes that those marketing wizards and gurus are going to know about me, well, a lot. In fact, at some point, they are going to reach some deepest recesses of my brain, extracting some hidden subconscious stuff I'm not fully aware of, and convert it into a banner that will suddenly flash on my screen, revealing to me this deeply buried and hidden part of my personality.
The fact, that this process of tracking and analyzing of user's online behavior is going full-swing dawned on me once when after watching a music video "Papa don't preach" by Madonna (I just like this song), I started receiving video ads of diapers, strollers, and stuff like that. Despite an apparently incorrect conclusion the iron brain made in this situation, I had nevertheless been impressed. Then I tried to reconstruct the possible logical sequence that preceded this google AI deduction and realized that according to some other factors it might have taken into consideration, the logic was in fact impeccable. It's just my profile included several inaccurate details that threw the computer brain completely off the trail.
So returning to the point, the initial premise is: There is some startup that offers an idea, that when a customer approaches some store or mall or cafe or whatever, a smart IoT device detects the presence of a potential marketing victim in the vicinity, and then it passes the control to an algorithm that begins to, to put it bluntly, aggressively stalk this unfortunate person online.
Ok, the owner of the store in the vicinity of which this guy had a misfortune to emerge wants to know about him everything. His preferences, past shopping history, friends and neighbors, youtube and google search history - like, everything - because the more information is available, the easier it is to create an accurate customer profile to customize ads, special offers, loyalty points and other brainwashing techniques. To fine-tune them to a point of perfect synchronization with the customer's brainwaves, so they would produce some subliminal effect, with the person realizing his dark, hidden desire to buy this vacuum cleaner or something like that.
While it's touted as a marketing breakthrough made possible by the development of technology, AI, and the pervasiveness of tracking each person's step online, it leaves a somewhat mixed emotion. Like it feels a bit creepy, this prospect of entering the store where the cashier immediately knows everything about you. (Technically, it's spoken of as an aggregated marketing data but who knows)
One of the key things this system promise is revealing whether an approaching person is a loyal customer or not. The loyal customer is going to receive a special kind of service, special propositions, and rewards. It makes me think, what if I'm not a loyal customer. Or even worse, I used to be a loyal customer, but then one day I broke my loyalty by visiting their rival's store. This fact is obviously registered by this omnipresent system, and every employee in the store I'm entering now is getting a message that they are dealing with a traitor. I can see their scornful, reproachful eyes on me. I try to finish my business there and leave as soon as possible before they decide to exercise revenge. So, it's sorta controversial.
Meanwhile, this idea of personalization of marketing is brought up more and more frequently. This is not the first time I come across a marketing startup which entire concept is based primarily on this idea. It seems convenient and even beneficial for the customers if we consider that shopping convenience outweighs giving away a shitload of personal information, part of which might turn out really sensitive. Still considering the pervasiveness of this idea, it's very likely to become reality in a very short time. Which can pose a whole lot of new interesting problems, hazards, and virally fascinating situations and incidents.