Classroom Companion: Business

 
► Example 7.5 Crowdsourcing Using Contests
Contests are important methods to trigger crowdsourcing events. One example is the 
CAESAR competition in which the goal was to develop new encryption methods. The 
contest started in 2012, and individual researchers or groups of researchers proposed 
new algorithms which were tested against cyberattack and other weaknesses by the par-
Digital service
Company
Produces
Produces
Ownership
Crowd
Hires
. Fig. 7.3 The crowdsourcing production model. (Authors’ own figure)
7.2 · Basic Production Methods

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ticipants in the contest. Six winning algorithms were announced in March 2019 after 
several rounds of eliminating proposed candidates. The winning algorithms are candi-
dates for new cryptographic standards.
In 2009, Netflix used a similar contest to improve its recommendation algorithm. 
The winner received one million US dollars (Jackson, 
2017
). The large premium was 
then the obvious motive to participate. Microsoft used crowdsourcing to test the security 
of the Windows 8 software. This included both detecting security bugs ($100,000) and 
methods to correct them ($50,000) (Bell, 
2013
).
◄
 
► Example 7.6 Crowdsourcing Using Collaboration Platforms
The business models of Topcoder and Clickworkers are based entirely on crowd-
sourcing.
The core business of Topcoder is to run a collaborative computer platform and to 
organize communities of individual coworkers. Computer scientists, system designers, 
and software engineers may join these communities and participate in various projects 
the company is developing for their clients. The company also uses online annual tour-
naments called Topcoder Open where members of the community compete in solving