Center for Citizen Media

It’s gone live: The Yahoo Time Capsule (Flash required) is where you can “share a piece of your online world” in a project that will be created for one month, and then go into storage with the Smithsonian until 2020. I’m planning to contribute.

The Citizen Media Gold Rush is in full fury, with Google’s buyout of YouTube as Exhibit A.

YouTube has been a fantastic success, and deserved a big payday. Is it worth $1.6 biilion, though?

I doubt it, and I think Google doubts it, too. Consider that Google paid with stock, not cash. Google’s stock looks overvalued from here, and if it is, the deal isn’t worth $1.6 billion. But it’s still worth a whole lot of money.

The deal reminds me of something from the 1990s: AOL’s buyout of an Israeli company called Mirabilis, which came up with ICQ, by far the most popular instant-messaging system of its day. Mirabilis had no revenues, much less profits. Its business model was to collect users, which it did brilliantly, and then to sell — for about $400 million, back then a phenomenal payday — those users’ attention and passion to a company that did have revenues and profits.

ICQ’s founding investor, my friend Yossi Vardi, is perhaps most famous in industry circles for a line he uttered during those bubble days. Asked what the business model was for a company with lots of users but no money coming in, he said, “Revenues are a distraction.” In his case, he was right. In lots of other cases, that line proved to be the anthem of the bubble-driven outfits that, for the most part, flamed out and took billions of investors’ money with them.

The network effect worked brilliantly in the ICQ case, as it has for YouTube. The more people who used the service, the more it was worth, in part because of switching costs: If you wanted to use a different instant-messaging service, you had to convince your friends to do so as well.

Ultimately, AOL didn’t make very smart use of ICQ. And smart tech developers found ways to collect various instant-messaging systems under one application (I use something called Adium on my Mac, and can see my various contacts who use various IM services in a seamless way.)

YouTube has a number of advantages. One, not sufficiently appreciated by non-techies, is the ease of use. YouTube makes it dead easy not just to view videos, but also to post them and to use the videos — via cutting and pasting snippets of code — on other websites. Just like that, you can have a YouTube video playing inside your own blog.

The other main value of YouTube is its celebration of human creativity — the rest of us, not just the entertainment industry — compounded by community. Do not underestimate the community that has sprung up around these videos. Other companies are providing similar (and in at least one case better) services, but they’re not close to duplicating the critical mass that YouTube has engendered.

YouTube also has some problems, including one that Mark Cuban has flagged: the utterly blatant copyright infringement taking place on the site. Sure, YouTube is making some deals with content providers, but one of its greatest values is the ability to find that video you missed yesterday; some of those videos will either disappear soon or be viewable only if you watch an advertisement first, which viewers will not enjoy.

In the end, this deal does look awfully pricey. Google has the stock to spare, and can outbid the competition in much the same way high-flying tech companies used stock to buy smaller companies in the 1990s. Will it all end in tears?

I can’t tell you which specific deals will come to grief. But anyone with common sense can feel the bubble mentality returning.

Doc Searls offers great ideas to newspapers. Most won’t listen.

Jason Calacanis has written a very tough piece about an operation called PayPerPost, a company that has gotten serious venture-capital backing for a “service” in which bloggers are paid to write about products — but are not required to disclose their financial interest.

We should generally abhor this kind of marketing. It encourages us to think the worst, not the best, about bloggers.

But is PayPerPost a cancer on the blogosphere, as Jason suggests? I’m less certain, largely because the company is doing in a public way what others are surely doing without bragging about it. If this outfit is cancer, it’s like a basal cell carcionoma, a less virulent form of skin cancer, easily handled and not normally dangerous; the really slippery operators are like colon cancer, which often has few symptoms until it’s too late. (We could take this metaphor further, but let’s not.)

The overall practice demands scrutiny, from other bloggers and from marketing/PR people who understand the value many people place on honorable dealings. We need to be exposing the people who take pay for play but don’t say they’re doing it. It’s not clear how we can find out who they are, but we all need to try.

Clearly this will require some of the “distributed journalism” or “networked journalism” or whatever we want to call it. I’d be interested in trying to pull together a project to do something like this, if other folks are interested.

Back to PayPerView and its methods. I wrote in PR Week a few months ago about a similarly deceptive operation, and what I said there applies here:

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Ellen Miller at the Sunlight Foundation writes, “Wow! You Finished It Already!” — explaining how the citizen journalists did their reporting on congressional family ties to political campaigns:

While we still have to verify the work, it appears that 16 current lawmakers are employing spouses in their campaigns.

This is how things can work when lots of people ask a couple of questions.

Ellen Miller, president of the Sunlight Foundation, which is sponsoring our Political Transparency project, reports early results from the organization’s Congressional Spouse Project, which is asking folks to help figure out “how many members of the House of Representatives hire their spouses to work for their campaigns—paying them a salary from campaign contributions.” She reports:

As of 8 AM EDT Saturday, we’re at 257 members investigated, and 12 spouses totaling some $455,539… We have been spot checking and all seem accurate. All will be verified before we release any formal results, Here’s a behind the scenes breakdown of what’s going on.

Amazing to see how quickly people have responded.

The Sunlight Foundation, which is sponsoring our Political Transparency project, has a new request for the public — this time helping out on the Congressional Spouse Project:

First, we want to find out how many members of the House of Representatives hire their spouses to work for their campaigns—paying them a salary from campaign contributions. (We’ll add a version for tracking the Senate soon.) Second, we want to begin developing tools that allow Citizen Journalists to record the results of their research, preserving the connections they find in unrelated collections of data.

This looks like something anyone can do. Lots of folks should give it a whirl.

Jon Dube is all over it, too.

Richard Anderson of Village Soup sees the creation of mostly-online, and online-first papers, and then driving those stories to print, lowers the cost of running a paper, making it possible to “restore service to communities of 20,000 to 40,000 that they once had.” That is, the service of news for small towns that have become too expensive, and have too few advertisers, for traditional media companies to have a news operation there. Interesting.

The person who runs the Stop Sex Predators blog, which broke the Foley political scandal, writes:

I’m not interested in media interviews. Thank you for your interest, but if you were doing your job to begin with, Mark Foley would have been exposed a long time ago. Instead of wanting to do a story about this blog, how about covering the fact that the media sat on this story for over a year. You’re as bad as the Congressional Leadership that covered for Foley.

The papers that didn’t run with the story were perhaps being overly cautious, but they didn’t hold off for trivial reasons.