From the early days of the Great Recession, business press pundits have wondered how far firms could go in taking advantage of new sources of free labor in order to stay afloat and improve their market positions. How can we take advantage of all the free time (or “cognitive surplus,"as net evangelist Clay Shirky puts it) that people have, especially the newly unemployed? Since many of the latter will be spending their newly free time online, how can we exploit their willingness to explore any avenue in search of the possibility of emploóment? Can we take advantage of their inclination to take on tasks that feel like fun? Or, more ominously, how can we harness their habitual need to participate in something that feels like work, in the absence of paid work andjust to keep their hand in?Advocates for this line of thinking have seen it as a viable business strategy. They have also made overblown bonanza-scale claims for the potential windfall, inspired no doubt by the high valuations of social media firms. Inevitably, it has been suggested that social networking is the oil of the twenty-first century;yet, so far at least, itlooks as if oil is still the oil of the twenty-first century.
Even so, the financial profile of these companies is remarkable. In 2011, Facebook took in an estimated \$4.3 billion in revenue, and almost \$1 billion of that was net profit. Leaving aside its pre-IPO valuation at more than\$100 billion, these numbers are big enough, especially if you consider that the firm only had not many more than 2,000 employees on paóroll. This ratio of employees to revenue is unusual by any historical standards, but it is typical offirms that dominate the upper stratosphere of information services. In 2011, Google, for example, had around 30,000 employees, but it pulled in an estimated \$35 billion in revenue for a \$13 billion profit. The other fast-growing social media companies—Twitter, Groupon, Zynga, LinkedIn, and Tumblr—are in the same boat.
For the rapidly shrinking population that are not Facebook users, Aaron Sorkin's film The Social Network must have presented a conundrum. On the one hand, the story of creative conception that it presents is reasonably familiar. Take a hothouse Ivy League environment where collegiate values are easily trumped by the predatory marketplace ethos already incubatingon the campus and add a cast of recognizable characters: a socially challenged white male engineer; a brainy white girlfriend who challenges him even further through humiliation; a socially desirable male entrepreneur; assorted and primarily Asian female groupies who are irresistibly attracted to Jewish men; and a neo-bohemian start-up crew working 24/7 to make a market breakthrough. These are all updated components of the standard Hollywood template for myth making in the field of technical invention. This is how national champions labor to bring dazzling innovations and lustrous wealth into existence.
In Search of the Lost Paycheck
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