Wednesday, March 11, 2009

Mechanical Turk: Profitable or Not?

I was chatting with a couple of students of mine, who are trying to build a startup using Mechanical Turk. So, they asked me what is the value of the tasks that are being posted every day on Mechanical Turk.

Since I have the archive of the tasks posted on MTurk for the last couple of months, this was an easy question to answer. A simple query on the database, find the new HITs posted every hour, group by day, and here is the plot:

Long story short, the average value of HITs posted in any day is around \$2000. I have not analyzed the distribution of the values, but it seems to be (not surprisingly) a power-law or a lognormal.

The 2K/day value means that the average revenue per day for Amazon is around 200 per day (10% of the requester's payment), or 6K/month. This hardly covers the expense of dedicating a developer to the service!

It seems that Mechanical Turk is not generating any significant revenue for Amazon. It is also unlikely that it generates any profit. And we know these days what happens to products that are not generating profits...

Thankfully Amazon uses Mechanical Turk for its own purposes, so there are second-degree benefits for Amazon to keep the service around. I truly hope though that the service will attract more customers soon.

Update: I should also clarify that my figures are slight underestimates of the actual figures: I can only "see" Mechanical Turk through the eyes of an average worker. So I cannot see if a requester asks multiple people to complete the same HIT and, sometimes, I cannot observe the details for HITs for which I have not passed the qualification test. I still think that the numbers will be at the same order of magnitude.

Update 2: If you want more details see my previous post on the dynamics of Mechanical Turk and the chart at that shows the available HITs and rewards at any given time.