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Sweatshops and Social Justice

by Brian Blum on February 3, 2010

in Employment,Entrepreneurs

sweatshopI’ve apparently started running a sweatshop. I didn’t mean to. It’s just what the market seems willing to bear.

It began with a small task. I wanted to move the content on my personal blog from one platform to another. Over the last 7 years, I’ve written well over 400 articles for This Normal Life.

I estimated that it would take between 3-5 minutes per post to transfer. That involved copying and pasting, adding categories and tags, and downloading and then re-uploading any images.

I was able to cut some of that time off by exporting from the original site into an XML format, but the process was flaky and many posts were just dropped indiscriminately.

I didn’t relish the idea of spending hours at a mind-numbing task. So I set out to find a “virtual assistant” who could do the job for me. I initially thought about posting an ad on eLance or oDesk but I really preferred to give it to someone local.

I was thinking that it would be a perfect job for a high school student, so I priced it at NIS 20 (about $5.00) an hour. The candidate who won the job was not a teenager, though. She was a mature adult whose hours working in the office of a major Jewish Federation had just been cut.

I felt terrible about employing someone so competent for such a paltry sum. But she’d accepted the offer willingly.

A week later, I put out another ad, this time for voice talent to record a number of dialogues for a language learning project I was hired to produce. I offered 50% more that my first go – NIS 30 ($8)/hour for about 3 hours of work. I was inundated by calls and emails – close to 50 within two days – including semi-professional actors, singers and performers with TV and radio experience. No one was balking at the low pay even though a proper rate for this kind of work would be 3-4 times higher.

The whole issue has given me pause for concern. Is the economy so bad that people are willing to settle for so little? And is it right for me to offer such rates?

And yet, if I outsourced the work to India or Malaysia, I would be a fool to pay Western salaries. And indeed, I recently had a logo designed via the Internet for the ridiculously low price of $30. A highly qualified local designer quoted me $700 for full branding.

The sweatshops where many of our grandparents worked on the Lower East Side of New York could get away with near slave labor prices, but that wasn’t good for the workers, nor would I say for the souls of their employers. A socially just policy should have the boss paying a fair rate, regardless of what the market can bear.

I’ll probably send my artwork requirements overseas again. But when it comes to my virtual assistant, I’m doubling her pay next time. There’s more to business than bragging over a bargain.

A shorter version of this article originally appeared on the Israelity blog.

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StarsOutbrain is a company I like a lot. It has a seemingly simple product that provides some very useful functionality: content rating and recommendations for blogs.

Follow the easy installation instructions and Outbrain will allow your readers to give your latest post a 1-5 score. Then, based on Outbrain’s massive database of reader tastes and web content, the Outbrain widget that displays on your blog will point visitors to related articles that Outbrain has determined they might find interesting.

Yes, it directs visitors away from your blog, but it also has the potential to turn your site a mini-destination site. (You can see Outbrain at work on this blog – scroll to the end of any post.)

When the company raised a sizable second round of financing earlier this year, a lot of brows were furrowed: $12 million for a blog plug-in? Investors must have had a sneak preview of the company’s latest feature, launched earlier this month: an enhancement that allows publishers to pay for premium placement of their content.

The new goodie is called OutLoud and it costs $10 per URL. Featured content appears at the top of the Outbrain recommendations list and is clearly labeled. Without OutLoud, Outbrain uses its own algorithms to suggest content.

OutLoud can be used in two ways. A publisher can let Outbrain control which sponsored recommendations appear; Outbrain will then split revenue with the blog publisher.

Alternatively, a publisher can set up the OutLoud service to work as an internal referral engine: only URLs from the publisher will appear. This can be used to generate more traffic within a single property or on a network of sites owned by the same publisher.

At first glance, $10 might seem like a no brainer for a small to medium sized online publisher, but it quickly adds up. And the $10 fee per URL is only for a month. You have to pay up if you want the sponsored link to keep going.

Outbrain says that the service is aimed at a number of target clients:

  • Marketers who want to drive word-of-mouth by amplifying positive reviews about their company.
  • Individual bloggers who want to promote their most brilliant posts.
  • Public relations professionals looking for new ways to distribute releases
  • Social media gurus who can push out articles from a corporate blog to drive traffic.

With such a cool product, I wondered what product management is like at Outbrain. Amit Elisha, who directs the process, says that the days of long and involved specs with accompanying Photoshop images are long gone. “We were work on a very fast 3-4 week release cycle,” Elisha said. “We prefer UI (user interface) mock ups over technical documentation, which we keep very brief.”

Elisha’s tool of choice is Balsamiq Mockups which makes it incredibly easy to create a wireframe. I tried it out and it lives up to the hype with a truly drag and drop interface. Thanks Amit for the tip!

Elisha has been with the company since August of last year and moved from Israel, where Outbrain started, to New York for the job. I asked him my favorite question about what parts of product management could be outsourced. None, he said. Outsourced people don’t have the same stake in the company. “We hire people with a certain DNA,” he added.

For publishers looking to generate additional revenue, OutLoud certainly looks promising, although it will take some time before the service has the critical mass to add up to more than just some extra change. On the other hand, it’s free to install and Outbrain doesn’t add its own branding or links back to the Outbrain site.

Outbrain was founded by Yaron Galai and Ori Lahav. The 25-person company has headquarters in New York with R&D in Israel. The latest round was led by Carmel Ventures with previous investors Gemini, Lightspeed and GlenRock Israel filling out the round. Total raised to date: just over $18 million.

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