Meher Roy 18 October 2016

THE ATTENTION

WEB

VALIDITY LABS – Enterprise courses -

ERIS FOR DEVELOPERS DECENTRALIZED APPLICATIONS

FOR DEVELOPERS

2 day on-site workshop

Build Mortgage Backed Securities

3 day on-site workshop

Build Attention Backed Assets 2

Introduction and key objectives

The value of attention streams

A basic attention backed asset

Crypto-tokens meet attention

economy

The Attention Web

Landing on Planet Radical

Acknowledgements & Resources

A BRILLIANT INVENTION - From the late 1500s -

4

THE JOINT STOCK COMPANY!

Investors / Capital contributors

Pool of Shares (stocks) =

Pool of Capital

Shareholders

(stockholders) .......

.......

.......

....... 5

THE POWER OF INCENTIVE!

Financial Incentive .......

Incorporation

.......

I need to grow this

pool!

I need to grow this

pool!

I need to grow this

pool!

I need to grow this

pool!

....... 6

SUCCESS!

7

GOLDHABER’S RADICAL IDEA

500 - 1500 AD

THE INDUSTRIAL ECONOMY THE FEDUAL

ECONOMY

RELATIONSHIPS

SCARCITY

TECHNOLOGY: Castle, Keep,

Landholding, Tribute

1600 - 1980 AD

CAPITAL

SCARCITY

TECHNOLOGY: Printing press,

Joint Stock Company, Engine

THE ATTENTION ECONOMY

ATTENTION

SCARCITY

TECHNOLOGY: Internet, ?

2000 - onwards

8

THE JOINT ATTENTION NETWORK?

Content consumers

Crypto-tokens =

Future Attention Streams

Tokenholders .......

.......

.......

....... 9

THE ATTENTION WEB

This presentation will walk you through one possible design and implementation of a Joint Attention Network.

Takeaways from this talk:

Reinforce the value of attention streams

Design of Attention Backed Assets

Vision of an Attention Web

10

Introduction and key objectives

The value of attention streams

A basic attention backed asset

Crypto-tokens meet attention

economy

The Attention Web

Landing on Planet Radical

Acknowledgements & Resources

IMAGINE A PERIODIC GATHERING – Church group or Music group -

12

Organizers want to sell you rights to install 2 screens at the venue. Able to display five 10-min ads every week, when 5000-strong gathering meets.

PROPOSITION!

13

VALUING ATTENTION STREAMS – A simple calculation -

REVENUE SIDE COST SIDE

Number of reachable impressions per week X

Market value of impression X

Factor for number of weeks

EXAMPLE

20,000 impression per week X $0.25

per impression X 50 weeks = $250k

Fixed Cost to install the screens +

(Recurring cost per week to maintain screen X

Factor for number of weeks)

EXAMPLE

$10,000 for installation +

($200 per week X 50 weeks) = $20k

Intrinsic Value of

screen rights =

(equals) - (minus)

Net present dollar value of

Cost to maintain (& grow) attention

stream

Monetizable attention stream 14

NET PRESENT VALUE – Notion -

Time

Resource Flow

Example: 20,000 impressions/week, 25 cents/impression, 3% annual interest

Intrinsic Value: $8.62 million

𝑉𝑎𝑙 𝑠𝑐𝑟𝑒𝑒𝑛𝑟𝑖𝑔ℎ𝑡𝑠 = 𝜙 𝑘 ∙ 𝜔(𝑘)

(1 + 𝑖)𝑘 −

𝐶(𝑘)

(1 + 𝑖)𝑘

𝑘=∞

𝑘=1

𝑘=∞

𝑘=1

15

VALID FOR DIGITAL ATTENTION STREAMS!

Value of Keyword ‘basketball shoes’ to Google = Total present dollar value of

(Searches per second X Fraction of searchers clicking on ads X Revenue per click)

For basketball shoes, million searches per week, 1% clicking on ads, $1 per click = $172.4 million

16

PERSPECTIVE FOR GOOGLE / REDDIT – Bundle of keywords or sub-reddits -

Sub-Reddit 1, Life time value = $21 million

Sub-Reddit 2, Life time value = $47 million

Sub-Reddit 3, Life time value = $100 million

Keyword n, Life time value = $z

. . .

. . .

And so on...

Keyword 1, Life time value = $100 million

Keyword 2, Life time value = $5 million

Keyword 3, Life time value = $1 billion

Keyword n, Life time value = $y

. . .

. . .

And so on...

17

INTRINSIC VALUE – GOOGLE SEARCH

Intrinsic Value of

Google Search =

(equals) -

(minus)

Net present dollar value of

Cost to maintain (& grow)

attention stream

Monetizable attention stream

+ (plus)

Current Owner’s

Equity

𝑉𝑎𝑙 𝐺𝑠𝑟𝑐ℎ = [𝜙 𝑘, 𝑘𝜔 ∙ 𝜔 𝑘, 𝑘𝜔

1 + 𝑖 𝑘] −

𝐶(𝑘)

(1 + 𝑖)𝑘+ 𝑂𝐸(𝑘 = 0)

𝑘=∞

𝑘=1

𝑘=∞

𝑘=1

𝑘𝜔=𝑎𝑙𝑙

𝑘𝜔=1

18

Introduction and key objectives

The value of attention streams

A basic attention backed asset

Crypto-tokens meet attention

economy

The Attention Web

Landing on Planet Radical

Acknowledgements & Resources

LET’S TOKENIZE ACCESS TO SCREENS!

Organizers want to sell you rights to install 2 screens at the venue. Able to display five 10-min ads every week, when 5000-strong gathering meets.

20

CREATE AND DISTRIBUTE CRYPTO-TOKEN

Community Members

Organisers

Distribute tokens

members & organisers

Create a million

tokens (meetpoints)

21

CREATE A SOCIAL CONVENTION!

Tokens traded on exchanges

Advertiser(s)

Token Burn

Promote content

on screen

1. Buy token on exchange

2. Burn token &

tag content

3. Top 5 burners have content displayed

22

SYSTEM DESIGN

Content / Message

Burn transactions

& tags

....

Client - Server

....

.... ....

Service request

Service reply

23

SMART CONTRACT BASED AUCTION

Deploys smart

contract

Catherine Programmer

Advertisers .........

Unsuccessful bid amounts

returned

Top-5 sent amounts

every week

Deposit auction

amounts

.........

24

HOW DOES ONE VALUE TOKENS? – Representing access rights in dollars -

25

SAME AS BEFORE!

Treasure Chocolate

(access rights to treasure)

Asset representing 20,000 impressions per week, 25 cents per impression from now until infinity Market cap of $8.62 million

Intrinsic Value of

basic ABA =

(equals) - (minus)

Total present dollar value of

Cost to maintain

(& grow) attention stream

Monetizable

attention stream

26

REMEMBER?

Financial

Incentive .......

Incorporation

.......

I need to

grow this

pool!

I need to

grow this

pool!

I need to

grow this

pool!

I need to

grow this

pool!

....... 27

INCENTIVE OF TOKEN HOLDERS – Attract people & advertisers -

Bring more attention Get content promoters

to burn tokens

28

WHY TOKEN BURN?

When someone burns

They effectively pay everyone else!

Anonymous token-holders

....... .......

....... .......

29

MAKING THE THOUGHT EXPERIMENT RICHER

COMMUNITY

MANAGEMENT

PAID FOR BY TOKEN

INFLATION

CONTROL USING

DECENTRALIZED

GOVERNANCE

30

INTRINSIC VALUE – BASIC ABA

Assuming all costs are paid for by the future dilution of ABA tokens

𝑃𝑘=0𝐴𝐵𝐴 ∙ 𝑄𝑘=0

𝐴𝐵𝐴 = 𝜙 𝑘 ∙ 𝜔(𝑘)

(1 + 𝑖)𝑘 −

𝑃𝑘 ∙ ∆𝑄𝑘(1 + 𝑖)𝑘

𝑘=∞

𝑘=1

𝑘=∞

𝑘=1

Intrinsic Value of

Basic ABA =

(equals) -

(minus)

Net present dollar value of

Cost to maintain (& grow)

attention stream

Monetizable attention stream

31

Introduction and key objectives

The value of attention streams

A basic attention backed asset

Crypto-tokens meet attention

economy

The Attention Web

Landing on Planet Radical

Acknowledgements & Resources

THE STRANGE TRUTH

Our Attention Backed Asset

Tied to a physical location

Cryptocurrency related attention

Tied to a digital location 33

WHAT IF?

Old social media New interest-based social media

Open data, multiple UXs, enables attention monetization

Closed data, single UXs, attention monetization for

profit of large corporate

Recency

Up-votes / Likes

Token burn

Recency

Up-votes / Likes

34

MASSIVE SPACE – JANEs of all kinds -

Sports based ABAs

Profession binding ABAs

Political ABAs

Lifestyle ABAs

35

UX - Serving different tastes -

36

ON THE BACK-END

Content / Message

Burn transactions

& tags .... ....

.... ....

UX SERVICE M

.... ....

UX SERVICE S UX SERVICE X

37

UX CENTRALIZATION - DESIRABLE

ATTENTION JANE TOKENS MARKET

Markets fundamentally need both sides to be quantifiable

Centralized UXs can use existing techniques (IP monitoring, user registration, machine learning etc.) to quantify human clicks and impressions

M

38

MULTIPLE AUCTION METHODS

BULK TOKEN BURN FOR BULK ATTENTION

No oracles needed

TOKEN BURN FOR CLICKS WITHIN ONE UX

UX service acts as oracle 39

INTRINSIC VALUE – ABA

Assuming all costs are paid for by the future dilution of ABA tokens

𝑃𝑘=0𝐴𝐵𝐴 ∙ 𝑄𝑘=0

𝐴𝐵𝐴 = 𝜙 𝑘, 𝜐 ∙ 𝜔 𝑘, 𝜐

1 + 𝑖 𝑘 −

𝑃𝑘 ∙ ∆𝑄𝑘(1 + 𝑖)𝑘

𝑘=∞

𝑘=1

𝑘=∞

𝑘=1

𝜐=𝑎𝑙𝑙

𝜐=1

Intrinsic Value of

ABA =

(equals) -

(minus)

Net present dollar value of

Cost to maintain (& grow)

attention stream

Monetizable attention stream

40

INCENTIVE OF TOKEN HOLDERS – Attract people & advertisers -

Bring more attention Get content

promoters to burn tokens

Spread word!

Create a great feed

Create great content

Upvote their content

Engage with them!

Create Memes

41

DAOs vs JANEs

Similarities

Both are implemented using smart contracts

Both have no central token issuer

Both enable automation at the center and at the edges

Differences

DAOs pool capital, JANEs pools attention

Pooling capital is regulated, pooling attention using crypto-tokens is a new paradigm altogether

DAOs suffer from majority vs. minority attacks, JANEs don’t

42

Introduction and key objectives

The value of attention streams

A basic attention backed asset

Crypto-tokens meet attention

economy

The Attention Web

Landing on Planet Radical

Acknowledgements & Resources

OPEN SOURCE ATTENTION PROTOCOLS

.... .... Information Web

Lenses to view the information web

Open source, fairly remunerative protocols

44

Introduction and key objectives

The value of attention streams

A basic attention backed asset

Crypto-tokens meet attention

economy

The Attention Web

Landing on Planet Radical

Acknowledgements & Resources

DAOs, JANEs And their offspring!

DAOs JANEs

DAOs, JANEs

DAOs

46

ECONOMICS – FACTORS OF PRODUCTION

LAND

CAPITAL ATTENTION!

LABOR

47

THE STRONG JANE HYPOTHESIS

Intrinsic Value of

Attention Backed

Asset

= (equals) -

(minus)

Net present dollar value of

Cost to maintain (& grow) attention

stream

Monetizable attention stream

48

Introduction and key objectives

The value of attention streams

A basic attention backed asset

Crypto-tokens meet attention

economy

The Attention Web

Landing on Planet Radical

Acknowledgements & Resources

ACKNOWLEDGEMENTS - INTELLECTUAL

MACIEJ OLPINSKI MICHAEL H. GOLDHABER SIMON DE LA ROUVIERE

50

Michael Goldhaber’s article ‘The Attention Economy’

Michael Goldhaber’s slideshow

‘The Real Nature of the Emerging Attention Economy’

Maciej Olpinski’s blog

Simon de la Rouviere’s article on Hashtag markets

Crash course’s video on The Dutch East India Company

RESOURCES 51

THANK YOU! ANY QUESTIONS?