Sunday, March 25, 2007

More good news

The old idea of what is tradable and what is not had to change as transactions costs plunged. Today's NY Times includes "AI, With Help From the Humans."

There are many tasks that the best deduction machines (computers) cannot do. And there are many induction machines (people) willing and able to do them. And software and the internet can now link buyers and sellers around the world. In a world market, such as this, prices will be low.

Interestingly, too low for the tastes of writer Jason Pontin. (He does not divulge what a "fair" wage would of should be.) More interestingly, business models can now evolve that fully exploit the possibilities.

COMPUTERS still do some things very poorly. Even when they
pool their memory and processors in powerful networks, they remain unevenly
intelligent. Things that humans do with little conscious thought, such as
recognizing patterns or meanings in images, language or concepts, only
baffle the machines.

These lacunae in computers’ abilities would be of interest
only to computer scientists, except that many
individuals and companies are finding it harder to locate and organize the
swelling mass of information that our digital civilization creates.

The problem has prompted a spooky, but elegant,
business idea: why not use the Web to create marketplaces of willing human
beings who will perform the tasks that computers cannot?
Jeff Bezos, the chief executive of, has created Amazon Mechanical Turk, an online service involving human workers, and he has also personally invested
in a human-assisted search company called ChaCha. Mr. Bezos
describes the phenomenon very prettily, calling it “artificial artificial

“Normally, a human makes a request of
a computer, and the computer does the computation of the task,” he said.
“But artificial artificial intelligences like Mechanical Turk invert all
that. The computer has a task that is easy for a human but extraordinarily
hard for the computer. So instead of calling a computer service to perform
the function, it calls a human.”

Mechanical Turk began life as a service that Amazon itself
needed. (The name recalls a famous 18th-century hoax, where what seemed to be a
chess-playing automaton really concealed a human chess master.) Amazon had
millions of Web pages that described individual products, but it wanted to weed
out the duplicate pages. Software could help, but algorithmically eliminating
all the duplicates was impossible, according to Mr. Bezos. So the company began
to develop a Web site where people would look at product pages and be paid a few
cents for every duplicate page they correctly identified.

Mr. Bezos figured that what had been useful to Amazon would be valuable to other businesses, too. The company opened Mechanical Turk as a public site in November 2005. Today, there
are more than 100,000 “Turk Workers” in more than 100 countries who earn
micropayments in exchange for completing a wide range of quick tasks called
HITs, for human intelligence tasks, for various companies., a comparison shopping site, uses Mechanical Turk to match images to the product pages. “Harnessing the power of this enormous, decentralized work force allows us to obtain images for a wide variety of items in a fraction of the time it would have taken to
do it ourselves,” said Sagar M. Jethani, PriceGrabber’s director of content development and community.

Mechanical Turk’s customers are corporations. By contrast,, a start-up in
Carmel, Ind., uses artificial artificial intelligence — sometimes also called
crowdsourcing — to help individual computer users find better results when
they search the Web. ChaCha, which began last year, pays 30,000
flesh-and-blood “guides” working from home or the local coffee shop as much
as $10 an hour to direct Web surfers to the most relevant resources.

Amazon makes money from Mechanical Turk by charging companies
10 percent of the price of a successfully completed HIT. For simple HITs that
cost less than 1 cent, Amazon charges half a cent. ChaCha intends to make money
the way most other search companies do: by charging advertisers for contextually
relevant links and advertisements. ....