Chapter 7 - Basic Production Models

Question 1

What is in-house production?

Answer 1

It is a production method where the company produces digital goods / services through internal resources and external resources through outsourcing. It is the most common production method.

Question 2

What is Commons-Based Peer Production (CBPP)? Which is the most famous example?

Answer 2

It is a production method involving:
1. A large number of external people (collaborators), which are self-organized and do not have a central leader actor.
2. A platform, whose function is to gather and organize all contributions from collaborators.

Most famous example: Linux operating system or the Internet itself.

Question 3

What is Crowdsourcing production?

Answer 3

Crowdwourcing happens when a company or an individual creates a predefined objective (producing a digital good) and inspires others to contribute to it.

Question 4

What is the difference between crowdsourcing and CBPP production methods?

Answer 4

Basically the only difference is that in CBPP collaborators follow arbitrary development paths, while in crowdsourcing the focal individual/organization sets as a goal a defined product.

Question 5

What are the main financing sources related to digital products production?

Answer 5

1. Crowdfunding
2. Peer-to-peer lending.

Question 6

What is the most popular crowdfunding platform?

Answer 6

Kickstarter

Question 7

What is peer-to-peer lending? How about the interest rates required? What is the main actor in such funding systems?

Answer 7

It is a funding mechanism where companies get connected with potential funders.

Interest rates are lower than bank loans but higher than bank deposits.

The main actor is the intermediator, which analyzes the market and connects companies with potential funders.

Question 8

Which are the three production methods for digital goods?

Answer 8

1. In-house production
2. CBPP - Commons-Based Peer Production
3. Crowdsourcing

Question 9

What is the acronym which can better describe Linux?

Answer 9

FOOS - Free Open-source Operating System

Question 10

What are the main challenges in crowdsourcing?

Answer 10

1. Coordinating the work
2. Scheduling and planning tasks
3. Attracting the right workforce and expertise
4. Quality management