Crowd Sourcing Case Study

I. A summary of the facts in the case: Crowdsourcing is the process of getting work or funding, usually online, from a crowd of people. The word is a combination of the words 'crowd' and 'outsourcing'. The idea is to take work and outsource it to a crowd of workers ("What is crowdsourcing," n.d). Crowdsourcing has become a mega trend in recent years, fueling innovation and collaboration in research, business, society and government alike. Global businesses like Facebook, Apple, Amazon, Netflix and Wikipedia are using crowdsourcing to enhance their businesses because it is a proven inexpensive means to gather useful business information. In fact, it is suggested that many of these businesses can attribute their success to Crowdsourcing.

However, as more and more businesses get on board with this practice, it is raising some very real ethical concerns. The U.S Department of Interior, for example was recently seeking a new design logo for their agency. Normally a job for a professional graphic design agency, the department opted instead to hire crowd sourcing company Crowdspring who in turn made the task into a crowd competition that awarded $1000 to anyone who could come up with the selected design. It is estimated that that would have normally cost 20,000-50,000 (Koster,n.d).

Crowdsourcing can be beneficial to companies for the following reasons: 1) Connecting businesses to their audiences; 2) Overhead and administrations costs are low saving the companies money; 3) It can provide opportunity for unknown designers and innovators.

II. Identification of the ethical issues or dilemma involved:

A. Ethical Issue Number One:

a. Crowdsourcing may be viewed as exploitation to pay people low amounts for work that would otherwise cost the company much more. Some crowdsourcing projects are being deemed a digital sweatshop where workers, who may be underage, work long hours on mind-numbing tasks for very little money--or, if the work is structured as a game, for no money at all. Crowdsourcing sites often pitch their work to stay-at-home moms or students who can pick up a few tasks to do during short breaks. Many companies especially exclusively online companies have gathered success from crowdsourcing-people working for free. There are currently a lot of content aggregating sites that owe its success to crowdsourcing.

1. Huffington Post for example built its popularity from unpaid bloggers, but sold to AOL for $315 million dollars, with no payment to those contributors. There is currently a pending lawsuit which argues the moral duty of Huffington post even though there were no legal obligations or contract (Ingram, 2011).

2. YouTube who garnered popularity from people posting online videos and gaining audiences was criticized by some for not paying those who created and uploaded videos after it was bought by Google for $1.6 billion in 2006 (Ingram, 2011).

B. Ethical Issue Number Two:

a. Crowdsourcing drives down the market value