Here is a fluffy post for a fluffy (but important) topic: the economics of attention.
Yahoo! is in the business of monetizing attention: that’s essentially what advertising is all about. We (Yahoo!) attract users’ attention by providing content, usually free, then diverting some of that attention to our paying advertisers. Increasingly users’ attention is one of the most valuable commodities in the world. This trend will only accelerate as energy becomes cheaper and more abundant, and thus everything we derive from energy (that is, everything) becomes cheaper and more abundant, on our way to a post-scarcity society, where attention is nearly the only constrained resource.
Today, users generally accept content and entertainment in return for their attention, though likely in the future users will be more savvy in directly monetizing their own attention. I’ve heard a number of companies and organizations large and small discuss direct user compensation. Beyond advertising, the economics of attention is important for the future of communication in general.
I haven’t found much academic writing on the topic, though I haven’t looked thoroughly. John Hagel’s piece “The Economics of Attention” is a good start, and he looks to have compiled some nice resources on the topic, though I haven’t yet investigated closely.
An organization that has garnered some attention of their own (of the Web 2.0 buzz variety) is Attention Trust. I find the description on their own website vague and impenetrable. The best explainer on Attention Trust I could find is PC4Media’s, though questions remain. The basic concept is simple enough: users should be empowered to control and monetize their own attention, including the output of their attention (e.g., their click trails, personal data, etc.). Just how Attention Trust plans to hand this power to the people seems to be the hand-wavy part of their story.
Another interesting company in this space is Root Markets, whose business is to connect both sides of the attention market in an attempt to commoditize attention. Their first product is much more specific than that: an exchange for mortgage leads.
If the absence of formal models of the economics of attention is real — and not simply a matter of my own ignorance — than it may be that some economist can make a career by truly tackling the topic in a precise and thorough way.
Hey David,
Root Markets and Attention Trust are both Seth Goldstein companies, if you weren’t aware. He’s definitely been a forward-thinker in this space.
Jeff
Thanks — I didn’t know that.
Society, Media and Economics have always been controlled how you focus consumers attention. A perfect example is religion.
It’s possible that as networking pushes into the third world the value of users’ attention as human beings will exceed their value as consumers:
http://abandontheweb.blogspot.com/2006/10/humane-network.html
As someone with an interest in prediction markets, some graduate economics and a Root employee this post is pretty interesting to me. One of the things that attracts me to this space is that attention (in our case, leads) is short lived. You can’t store attention — it’s carrying costs are too high. So any forward contract on attention is by default a position in a prediction market.
Addendum:
Some readers responded to this post via email with interesting and relevant pointers, including these two papers:
Attention Economies
The Economics of Attention: Maximizing User Value in Information Rich Environments
Also, Bo Cowgill responded to this post with some interesting ideas.