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New research on the web from Harvard Business School faculty on issues including the development and use of the semantic web, and designing effective web sites.
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Is the 'Experimentation Organization' Becoming the Competitive Gold Standard?

by James Heskett

SUMMING UP: Digital experimentation is gaining momentum as an everyday habit in many organizations, especially those in high tech, say James Heskett's readers. Open for comment; 0 Comments.

Ideological Segregation among Online Collaborators: Evidence from Wikipedians

by Shane Greenstein, Yuan Gu, and Feng Zhu

This study analyzes the dynamics supporting or undermining segregated conversations. Among the findings: In spite of their great differences, contributors on Wikipedia tend to move toward less segregated conversations. Contributors’ positions become more neutral over time, not more extreme. In addition, the conflict resolution mechanisms and the mix of informal and formal norms at Wikipedia play an important role in encouraging a community that works toward a neutral point of view.

Airbnb Hosts Discriminate Against African-American Guests

by Carmen Nobel

Experimental research by Ben Edelman, Michael Luca, and Daniel Svirsky revealed widespread discrimination against African-American guests on Airbnb. Now the researchers have created an online tool to mitigate it. Open for comment; 0 Comments.

When Hosts Attack: The Competitive Threat of Online Platforms

by Carmen Nobel

Online retail platforms like Amazon are great for the third-party businesses that use them—until the platform’s owner decides to start competing with them. Feng Zhu looks at the factors that turn hosts into predators. Open for comment; 0 Comments.

Can Applied Economics Save Homeless Puppies?

by Carmen Nobel

At a startup she co-founded while pursuing a doctorate in economics, Christine L. Exley is rescuing dogs with principles of market design. Open for comment; 0 Comments.

Reviews, Reputation, and Revenue: The Case of Yelp.com

by Michael Luca

In just six years, Yelp.com has managed to crowdsource 20 million reviews of restaurants and other services by creating and leveraging an impressive social network of people who enjoy writing reviews. But can a bunch of amateur opinionators working for free really transform the restaurant industry, where heavily marketed chains and highly regarded professional critics have long had a stronghold? To answer this question, HBS professor Michael Luca combined Yelp reviews with revenues for every restaurant that operated in Seattle, WA at any point between 2003 and 2009. Applying a new method to tease out the causal effect of reviews (separate from the effect of underlying quality), the study shows that a one-star increase on Yelp leads to a 5 to 9 percent increase in revenue. Yet Yelp doesn't work for all restaurants. Chain restaurants —which already spend heavily on branding —are unaffected by changes in their Yelp ratings. This suggests that consumer reviews present a new way of learning in the Internet age, and are fast becoming a substitute for traditional forms of reputation. Key concepts include: Online consumer review websites provide more information to consumers than was previously thought to be cost-effective. By relying on user-generated content, Yelp is able to review more products than traditional media such as newspaper reviews. More than 70 percent of Seattle restaurants are on Yelp. The impact of consumer reviews depends on the existing reputation of a company or product. Consumer reviews are effective overall, but ineffective when a product has a firmly established reputation (such as a chain restaurant). Consumer reviews provide a substitute for more traditional forms of marketing. Other forms of reputation such as chain affiliation may become less influential as websites like Yelp continue to gain traction. Evidence suggests that this pattern is already emerging. Consumers rely on simple metrics such as the average rating and the number of reviews, and are more trusting of reviews that are written by "elite" reviewers (as identified by Yelp). Closed for comment; 0 Comments.

Why Are Web Sites So Confusing?

by Andrei Hagiu & Bruno Jullien

Just as bread and milk are often found at far-away ends of the supermarket, Web sites that match consumers with certain products have an incentive to steer users to products that yield the highest margins. The result: a compromise between what users want and what produces the most revenues, say HBS professor Andrei Hagiu and Toulouse School of Economics researcher Bruno Jullien. A look inside the world of search. Key concepts include: "Search diversion"—strategically complicating the search process—began in the brick-and-mortar world. The digital economy provides many more subtle ways to divert search. If an intermediary helped consumers find what they wanted more quickly and efficiently, it would lose valuable potential revenues. On Google, the 11th objective search result might be more relevant than any of the sponsored search results displayed on the right—yet it will be displayed on the second search page only. Closed for comment; 0 Comments.

When the Internet Runs Out of IP Addresses

by Sean Silverthorne

Experts predict that within three years we will see the last of new Web addresses. What will happen then? The best solution is to create a market for already assigned but unwanted numbers, says Harvard Business School professor Ben Edelman. Key concepts include: Internet regulators are running out of IP addresses to assign new Web-based sites and services. The next IP standard is probably years away from widespread deployment. In the meantime, creating a market for unused addresses could help bridge the gap. Closed for comment; 0 Comments.

Is MySpace.com Your Space?

by Sean Silverthorne

Social networking sites such as MySpace.com have demographics to die for, but PR problems with parents, police, and policymakers. Are they safe for advertisers? A Q&A with Professor John Deighton. Key concepts include: Social networking sites such as MySpace.com are emerging as powerful advertising platforms reaching millions of desirable consumers. They will be advertising rivals to established Internet sites such as Google and Yahoo. Although MySpace has been the subject of some community criticism, MySpace advertisers don't seem frightened off. Closed for comment; 0 Comments.

What Happens When the Economics of Scarcity Meets the Economics of Abundance?

by James Heskett

The "Long Tail," a term coined by Chris Anderson—and the title of his new book—describes the item popularity curve. Does the Long Tail represent a paradigm shift for business and consumer behavior? What are its implications for management going forward? Key concepts include: Chris Anderson first coined the term "the Long Tail" in Wired magazine. In a long-tail world, everything digital is available at all times. Anderson describes three conditions critical to potential long-tail profits, all of which are provided by the Internet combined with creative new software and hardware. Closed for comment; 0 Comments.

Getting the Message: How the Internet is Changing Advertising

by Susan Young

In the six years since the first banner ad appeared on the World Wide Web, advertising has been transformed. With powerful technologies that can track responses and target customers, the Internet offers marketers a new world of opportunities. HBS Professors Alvin J. Silk and John A. Deighton and others offer perspectives, in this article from the HBS Bulletin, on advertising in the age of the Web. Closed for comment; 0 Comments.