Wednesday, July 18, 2007

ABC7 offers 'futures market' for news

KGO ABC7 is promoting an online "futures market" where viewers can vote on the probability of certain outcomes of news stories, such as "When will the Waste Mangement lockout be resolved?" or "Will Ed Jew complete his term as a San Francisco Supervisor?" Based on voting, the possible outcomes to such questions rise and fall like stock prices.

The premise is that a crowd is more likely to generate an accurate answer than so-called experts. Matt Novak of the SF Weekly points out that the idea comes from James Surowiecki's book, "The Wisdom of Crowds." "Surowiecki identifies four key characteristics that make crowds smarter than experts: They're diverse, decentralized, networked and composed of independently minded individuals who execute decisions based on their own information gathering, rather than what others are doing," Novak says.

Nowak reports that the forum is a product of Inkling Markets., a Chicago company with seed money from yCombinator, a venture firm started by hacker Paul Graham.

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