Ed: You are looking at the structures of ‘virtual production networks’ to understand the economic and social implications of online work. How are you doing this?

Mark: We are studying online freelancing. In other words this is digital or digitised work for which professional certification or formal training is usually not required. The work is monetised or monetisable, and can be mediated through an online marketplace.

Freelancing is a very old format of work. What is new is the fact that we have almost three billion people connected to a global network: many of those people are potential workers in virtual production networks. This mass connectivity has been one crucial ingredient for some significant changes in how work is organised, divided, outsourced, and rewarded. What we plan to do in this project is better map the contours of some of those changes and understand who wins and who doesn’t in this new world of work.

Ed: Are you able to define what comprises an individual contribution to a ‘virtual production network’ — or to find data on it? How do you define and measure value within these global flows and exchanges?

Mark: It is very far from easy. Much of what we are studying is immaterial and digitally-mediated work. We can find workers and we can find clients, but the links between them are often opaque and black-boxed. Some of the workers that we have spoken to operate under non-disclosure agreements, and many actually haven’t been told what their work is being used for.

But that is precisely why we felt the need to embark on this project. With a combination of quantitative transaction data from key platforms and qualitative interviews in which we attempt to piece together parts of the network, we want to understand who is (and isn’t) able to capture and create value within these networks.

Ed: You note that “within virtual production networks, are we seeing a shift in the boundaries of firms” — to what extend to you think we seeing the emergence of new forms of organisation?

Mark: There has always been a certain spatial stickiness to some activities carried out by firms (or within firms). Some activities required the complex exchanges of knowledge that were difficult to digitally mediate. But digitisation and better connectivity in low-wage countries has now allowed many formerly ‘in-house’ business processes to be outsourced to third-parties. In an age of cloud computing, cheap connectivity, and easily accessible collaboration tools, geography has become less sticky. One task that we are engaged in is looking at the ways that some kinds of tacit knowledge that are difficult to transmit digitally offer some people and firms (in different places) competitive advantages and disadvantages.

This proliferation of digitally mediated work could also be seen as a new form of organisation. The organisations that control key work marketplaces (like oDesk) make decisions that shape both who buyers and sellers are able to connect with, and the ways in which they are able to transact.

Ed: Does ‘virtual work’ add social or economic value to individuals in low-income countries? ie are we really dealing with a disintermediated, level surface on a global playing field, or just a different form of old exploitation (ie a virtual rather than physical extraction industry)?

Mark: That is what we aim to find out. Many have pointed to the potentials of online freelancing to create jobs and bring income to workers in low-income countries. But many others have argued that such practices are creating ‘digital sweatshops’ and facilitating a race to the bottom.

We undoubtedly are not seeing a purely disintermediated market, or a global playing field. But what we want to understand is who exactly benefits from these new networks of work, and how.

Ed: Will you be doing any network analysis of the data you collect, ie of actual value-flows? And will they be geolocated networks?

Mark: Yes! I am actually preparing a post that contains a geographic network of all work conducted over the course of a month via oDesk (see the website of the OII’s Connectivity, Inclusion, and Inequality Group for more..).

Mark Graham was talking to blog editor David Sutcliffe.

Mark Graham is a Senior Research Fellow at the OII. His research focuses on Internet and information geographies, and the overlaps between ICTs and economic development.