It is time we closed the loop on the Steem economy and provide another answer to an age old question, “where does the money come from?” Starting today authors, advertisers, and evangelists can promote content to be discovered by more readers.
We are pleased to announce a “Promoted Content” section that will soon be available right next to trending and hot. This section sorts articles based upon which articles have received the most Steem Dollars from users.
How does it work?
Anyone can transfer Steem Dollars to @null and include the @author/permlink they would like to promote in the memo. The Steem Dollars will be added to the total received by the post and increase its ranking in the promoted content ordering. steemit.com will provide a helpful button at the bottom of each article that allows anyone to simply enter an amount and promote the content without worrying about filling out a transfer form.
Who gets the Money?
The @null account is a special account which no one has control over. This means that once money is transferred to @null it is locked away for ever. In a future hard fork we will remove the Steem Dollars, Steem, and Steem Power held by this account from the supply, but until then it is effectively gone.
This means the money is distributed to all stakeholders. Since all payments are made in Steem Dollars and Steem Dollars are similar to the debt of the network, it means all payments made to promote posts serve to reduce the debt load on Steem which increases the value of Steem.
Why view Promoted Content?
When someone promotes content they are attempting to advertise their content. This means they expect a return on investment. There are two ways they can get this return: directly by receiving votes or indirectly by selling another product, service, or idea.
In other words, this content is self-curated in a way that can help readers discover new authors that believe in themselves enough to invest in their own content and build an audience. When you view this section of steemit.com you will discover a different cross section of content.
The more people that read, vote, and follow users who promote their content the more people will be willing to spend to promote content. The more people spend, then more Steem grows in value. In other words, simply visiting the promoted content page and reading promoted articles helps boost capital flowing into the platform.
Should I vote on Promoted Content?
You should only vote on promoted content if you would normally vote for it.
Just because someone promoted it doesn’t mean it deserves a vote. If promoted content starts to consistently earn more from votes than it costs to promote, then the market will respond by increasing the cost of promoting content. This cycle will continue until the risk / reward of promoting content balances out. In other words, the market will naturally push all profit margins toward 0.
Should I flag promoted content?
Posts that are heavily flagged will not show up in the promoted content list. This means that the community can and should filter the garbage from the promoted content. If you believe the promoted content to be “over paid”, “abusive”, “copyright infringing”, or otherwise “garbage” then you should flag it.
When someone pays to promote content they are paying for voter attention, but they are not promised positive attention. If they get negative attention then their investment in promoting their article will be worthless. It is the possibility of negative attention leading to filtering that keeps the promoted content free from spam advertisements.
If the community adopts a policy of flagging and “removing” legitimate promoted content from the queue then it will reduce the price people are willing to pay to promote their content. Worst case, it could cause people to avoid promoting content all together.
Do votes impact promoted ranking?
Unless a post receives more down votes than up votes the number of votes will have no impact on its ranking in the promoted section.
How long is promoted content displayed?
A promoted post is displayed until its first payout. After that time it will no longer be listed on the promoted page index.
Steemit, Inc Disclaimer
The @null account is a special blockchain level account and does not belong to Steemit, Inc or any other individual. Sending money to @null does not constitute a contract between you and anyone else. Steemit, Inc can and will change how it chooses to display, filter, and sort posts in the promoted section at its sole discretion.
This experiment should be a fun opportunity for the community to test the market demand for paid promotion. Its relevance depends upon the attention the Steem community voluntarily gives to promoted content. If successful it could create a virtuous cycle that benefits everyone involved. If it turns out to not be a valuable feature, then we will have all learned something!