Over The Counter Culture

There’s an interesting introductory article (albeit a little light on substance) in the NYTimes today on these multimillion dollar prizes that seem to be proliferating these days, incentivising philanthropic (usually tech-focused) progress. Recent examples include the Ansari X Prize (space travel, $10m) , Google.org RechargeIT (energy efficient cars, $10m) – which is similar in its theme to the Automotive X Prize, the Archon X Prize (genomic sequencing, $10m) and the Google Lunar X Prize ($30 million). Several more prizes are in the pipeline, too – mainly the X Prize Foundation’s pipeline!

For all their glamour, headline-grabbing magnetism, and all-round ‘wow’ factor, just how much good is the X Prize Foundation actually doing? It’s extremely hard to quantify the social benefit of an innovation, admittedly. As I mentioned earlier, part of me feels that this isn’t money particularly well spent, despite the awe that their projects inspire.

I have three overriding issues with these prizes:

1. The X Prizes in practice have very little social value (I’ll go into this in more detail below). This is a terrible shame, not just because of the missed opportunity for genuine humanitarian benefit, but also because society still lacks a contemporary poster child (one that everyone has heard about) for the value and effectiveness of inducement prizes (as opposed to reward prizes that recognise prior achievement) as a philanthropic lever.

2. Furthermore, the X Prize Foundation is exclusively the domain of the rich. Why should it be?! At present, the donations you and I make to charity far outweigh those of the Bill and Melinda Gates Foundation. At the same time, the Internet and globalisation are starting to unite millions of people in support of very specific causes (the “Support the Campaign for Breast Cancer Research” application on Facebook has amassed 2.5 million supporters since its foundation this year)

So why are we not seeing crowdsourced prizes for (mass) philanthropy? The potential is there!

3. There’s a danger that these huge honeypots are polarising current research thinking and effort (on areas which I feel has little value at present), whereas left to its own devices (or faced with a diversity of prizes providing milder incentives across a wide range of problems) this R&D work could deliver bigger, broader benefits. These prizes could be keeping creative minds ‘in the box’, as it were.

I should explain why I feel the X Prizes have so far been misspent money. Case in point: the genomics prize. There’s already a very large commercial incentive to develop rapid genome sequencing. Bringing rapid genome sequencing to the lab would allow the developing company to undercut the current (highly lucrative) mail-order sequencing business entirely, selling expensive hardware and the lucrative maintenance contracts to go with it.

The Ansari X Prize wasn’t much better. Right now, commercial spaceflight is just another fatcat fantasy. Progress in space travel had stalled, it’s true, because we haven’t yet found planets really worth visiting within distances that we can travel given our current knowledge of physics. The basic science just isn’t there; other than the ‘wow – cool!’ factor and the prize money (which is ten times lower than the amount of money spent on trying to achieve it – estimated to be $100m), there is little rational logic to incentivise the viability of suborbital spaceflight.

It’s unclear just how much of the new technology this provided is transferable to other fields, let alone to proper spacetravel once we have the ability to travel long distances in a short amount of time.

Once the basic science is in place to make spacetravel potentially worthwhile, I’ll change my tune. Until then, I’ll say this: $110 million dollars just went down the drain, as did the R&D time of many talented people who could have achieved something actually beneficial to humanity.

What of the Google and X Foundation’s separate automotive prizes? They’re largely overlapping in their aims (to create extremely energy efficient cars), though Google.org has at least put a bit of an original spin on their competition, requiring that cars be so efficient that they can produce surplus electricity that can be re-sold to the local grid. These are valiant aims, for sure, but again, with oil prices as high as they are (and rising!) I can’t help but be skeptical that this kind of R&D really needs to be incentivised.

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This entry was posted on Tuesday, November 13th, 2007 at 6:32 pm and is filed under Musings. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.