
18F's Micro-Purchase Experiment: Why I Bid $1 - brensudol
http://www.brendansudol.com/writing/18f-micropurchase/
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femto113
I think if there's any lesson to be taken from this it's that presenting
bounded, well-described (and thus easily undertaken) sub-projects is probably
more effective than simply inviting developers to "help out" in some non-
specific manner on a larger open-source efforts.

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OJFord
This is a great outcome for that story. I must admit, I did too assume it was
trolling behaviour when I saw the bidding on HN.

He wanted to do the work, he got what he wanted, and the US Government got the
job done for just $1!

Not sure how anyone can see this but a victory for the US public.

18F is, I think, a fantastic initiative; I hope HM Government takes note -
could be fantastic here in the UK too.

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mintplant
I hope it's not dismantled by the next administration to come into power.

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arglebarnacle
I think it's going to be safe. It demonstrably saves much much more than it
costs, so conservatives will likely support it from a cost cutting/reducing
government "waste" perspective. Liberals will support it because it's smart
and makes government run better.

I think only an extremely cynical view would suggest this program isn't safe,
a view in which conservatives intentionally dismantle good cost-saving
government programs while leaving bad ones for the sole purpose of giving
government a bad name.

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mtanski
Has our legislative branch behaved rationally in the last few years? Recently
they threatened forcing a default for unrelated (to budget) issues. And in the
not to distant past they voted a law that prohibits Medicare from to using
it's bargaining power to negotiate for lower drug prices. You know something
that would save every tax payer quite a bit of money since Medicare is one of
the larger budget line items.

Based on past behavior you don't have to be overly cynical to think a useful
program like this could be eliminated.

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tvanantwerp
Fortunately, 18F is under the GSA, which is the executive branch. It's
entirely likely that most Congressmen don't know 18F exists.

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sailfast
More to the point, 18F is supposed to be a self-funded organization that
shouldn't draw much from the overall GSA budget. (Not sure if that applies to
standing up the organization / hiring and other investments). It would be a
hard argument to kill it. That said, The US Digital Service is out of the
White House Office of Science Technology Policy (a distinctly political /
appointed office) and USDS / 18F interact quite a bit so momentum could be a
challenge if there was executive-level antipathy.

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davideous
This appears to be working so far.

One sample doesn't really establish a "market rate" yet, so I don't worry
about the seller not being motivated by financial profit motive. Sometimes the
value provided to the seller goes beyond the financial payment. 18F gets a
good deal here because of the intangibles they have to offer.

If they put out more projects than the amount of work people are willing to do
at the "$1 volunteer" or "$1 build my portfolio" rate, then the price should
go up. How deep is this pool? I guess they will find out.

The big challenge, I think, will be if bad actors start coming in and making
crazy bids and then doing sloppy work. Time will tell.

I'm excited to see how this develops.

~~~
kbenson
Yes, what we have here is the volunteer actually being paid in social capital
and personal satisfaction, but not _directly_ from 18F. 18F has heavily
promoted recently, and that along with them being a part of the government and
the project being open source all contributed to the volunteer feeling it was
a worthwhile endeavor at that price. It's an interesting case study of how any
market pricing function that looks at _purely_ monetary cost is usually a poor
pricing function unless the market is _extremely_ liquid.

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USNetizen
The problem with this isn't that the bidder wanted to do something noble, it's
that it set a precedent that the government is going to expect on future bids
moving forward. "Buying a contract" is nothing new - companies do it all the
time (i.e. deliberately dramatically underbidding just to get the past
performance). However, reverse auctions are a lose-lose for the government and
commercial sector. This approach assumes that the only thing that separates
vendors is price alone, which is incorrect. For commodities, perhaps it works,
but for IT you get what you pay for. Just ask the other numerous agencies
backing away from the reverse auction model due to disastrous lowest-bidder
contractor performance.

I do, however, wholeheartedly embrace the pilot-model approach to IT
procurement (i.e. MVP for government). It will help avoid those failure-prone
$100M+ acquisitions that are doomed from the start, thus saving taxpayer money
and allowing innovators to shine in practice, not through proposals.

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Johnny555
"For commodities, perhaps it works, but for IT you get what you pay for"

Well, you don't, sometimes you just pay for overhead you don't need.

My wife works at a small 15 person non-profit - I was shocked when I heard how
much they pay for IT support from a small support organization.

She asked what other choice they had, because they don't have anyone on-staff
that can do it, and their old hardware needed a lot of support.

So I put together a proposal - for less than they were paying for a year of
support services, they could replace all of their hardware with new hardware
(including desktops, network and printer), plus move from hosted Exchange to
Gmail (for another big cost savings).

I spent a weekend setting up the hardware, including automatic backups to a
local fileserver plus crashplan for remote cloud backups (they had no backups
at all before, just a bunch of flash drives with various bits of information).

They saved money after the first year, plus they had all new and reliable
hardware. They bought a block of 40 hours of support from their IT support
organization and haven't even used half of that over 2 years.

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ploxiln
I have to agree, with digital technology, "you get what you pay for" breaks
down completely. Sometimes the very best choice for one component is cost
free, or very low cost, because reproducing that component 100% perfectly is
pretty much free.

The big problem is identifying what is a good choice. If you don't know, you
can't easily contract out the choice either, how do you know the contractor
can or will make a good choice for you?

So the best outcome for non-technical organizations is to get lucky and know
someone personally who knows what they're doing and has no ulterior motive -
someone just like you. They don't really know if they know such a person. But
if they get lucky and pick just the right helpful competent person to make IT
decisions for them, modern technology can give them quite a lot for very
little.

It's a perplexing situation.

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bicknergseng
18F/USDS peeps... would you consider bounty or reward style programs that
reward all open source contributors? Eg instead of bidding for a contract,
keep an open list of tasks/bugs/full projects and reward contributors whose
PR's are merged in some way?

Yes, I know this monetizes what used to be free in a way and maybe goes
against the "spirit" of open source, but practically speaking it feels like
it'd be a huge win win for the open source community and small to medium sized
government projects in general.

~~~
noahkunin
@bicknergseng -

18Fer here. The main issue here is how the Gov actually gets $ to that entity.
There are lots of laws and rules that we need to obey about who we pay $ to -
Gov doesn't have a ton of flexibility here. There was a reason why bidders had
to be pre-registered.

That said, many of us want to continue to expand our engagement with the
community. When it comes to bounty/reward style programs, the one I'm
personally focused on figuring out first is a bug bounty program. Once we've
figured out solutions for a bounty type program, you'll absolutely hear from
us.

edited: small typo

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neltnerb
I'm sure you've thought of this, but is it impossible to subcontract this out
to a non-profit to increase flexibility in the details of how the work is
done? I.e. same requirements, same constraints, but the non-profit is formally
registered with GSA and handles payments to subcontractors rather than the sub
getting it straight from the government?

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wslack
18Fer here. Is this in regards to a bounty program or putting out specific
microtasks?

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neltnerb
The bounty program as a whole. Like when I worked at NREL they were government
funded but on paper I think it looked like a subcontract to run the lab which
was fully managed by another entity. NREL I'm sure can hire contractors,
although I suppose they might have to be in GSA as well?

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ac2u
> __It didn’t seem controversial to me. Writing some code to help out the
> government and the general public—what a unique opportunity! __

Y 'know, if the author explained it along the lines of "I wanted to have a
record of government work as a foot in the door", I think it would be an
easier pill to swallow for the folks bidding at reasonable prices.

However, the tone here is a little patronising if another bidder was just
trying to get enough to cover the rent.

But at the end of the day, it's the way that system was set up. Hopefully 18F
sees this as an opportunity to improve the auction system (secret minimum and
other suggestions in the other thread), rather than a way to get cheap labour.

~~~
luma
Why would anybody be against competent coders wanting to donate time to public
use? I get that other people were hoping to be paid for this, but would you
end all volunteer programs on account of them interfering with paid labor?

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anm89
No one is. If you want to donate your time there are a million non profits
that will gladfully take the donation.

There is no reason this process has to devalue everyone else's work on a paid
job.

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fineman
Then get another job. We don't owe you your line of work.

If you literally can't compete with volunteers maybe you should see what they
says about your niche and then find a new one.

Once when replacing a server (and fixing the wiring, etc, etc) I also replaced
a router and dual-homed the company's site as a freebie because it made my job
easier (the new router had diagnostics, managed-switch features, etc). It was
a line-item I could have billed for separately, or it was a new level of
service.

By the "save the work for the guy feeding the starving children" philosophy we
should nickel-and-dime our clients instead of providing our true value. I
don't like that.

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fineman
btw, I'm a supporter of unlimited (ie, not limited - I would try to encourage
you to not need it though) welfare to let society say "tough" things such as
"Oh well, I guess we don't need many buggy whips."

And as to why I didn't charge anyways - the change actually made my other work
faster.

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ksk
Working for free is a luxury for the people not struggling to ends meet.

"Oh, I already got paid elsewhere, but let me work for free and outbid others
who are doing this as their primary job" is the unstated context and it feels
a tad bit smug and elitist.

Personally, I think that the goal should be to get paid while you work on open
source. But, I know that its not an option for everyone.

>I use open source technologies on a daily basis, and this seemed like a great
opportunity to give back a little.

If you want to contribute to open source, then please feel free to join an
open source project.

~~~
kbenson
> and it feels a tad bit smug and elitist

Saying that about someone who wants to help out so essentially volunteers
their time to help a government project, which in essence means it helps
everyone, seems a bit entitled and ill-informed.

I'm sure many people want to get paid to work on open source, but it's a free
market, and people will bid what they think a project is worth, and worth
isn't always about monetary compensation.

Complaining about this is essentially the same as complaining about soup-
kitchen volunteers. Surely there are plenty of people that would love to be
paid for that job, but we have all these smug elitist volunteers doing the
jobs for free.

> If you want to contribute to open source, then please feel free to join an
> open source project.

The people that start/work on a specific open source project have the right to
_ask_ for compensation in whatever way they like, or _enforce_ it through
their license. You have no right to speak for all open source projects.

~~~
yellowstuff
Any form of volunteering replaces some amount of paid work. The pros and cons
need to be evaluated on a case by case basis.

If volunteers do just enough free programming to drive professionals out of
the market, it's possible the result will be that less work gets done. I don't
think soup kitchens have the same risk.

~~~
nogoodnamesleft
> The pros and cons need to be evaluated on a case by case basis.

Utilitarianism? Watch it quickly spiral into a shit show.

These same concerns and arguments are nothing new. People have been bemoaning
the evils of open-source and it's socialist ways as unethical and selfish for
years. And look how the software market still flourished. In many cases,
directly off the backs of unpaid developers.

There's a good chance we're beyond a tipping point of ever again having enough
work for the masses anyway. Look how many able-bodied folks the Feds hide
under disability to keep the unemployment numbers low. And computing jobs will
continue to vanish as software advances. You gonna tell a software company
they can't launch their accounting AI because of CPA job losses? You going to
stop IBM from improving Watson because it might cost us some Javascriptkiddie
jobs (don't need as many web pages if Watson can do my work just by talking to
it, or just having a brain-wave interface)?

Humanity will shrug and do what they did when cars replaced horse and buggy:
Carry on.

~~~
jtuente
So I think most people completely miss this when they see it, but I love it
when people call "socialist" things selfish. It's the very definition of irony
that something done "for the benefit of others" is deemed to be done solely
for the person's ego. Personally, I don't see open source as inherently
socialist anyways, but that's another topic entirely.

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Kiro
This happens all the time with public procurements in Sweden. It's not
uncommon to see negative bids as well. After you've got the contract you can
bill them for service hours etc so it's a win anyway.

~~~
sailfast
Do you think bids would come in negatively for Firm Fixed-Price work. In this
case (micro-purchase), you are not allowed to bill again for the same service
so the $1 is pretty much where you stop, unless further contract work is
pursued which can take months. Genuinely curious.

~~~
Kiro
Sure, that could be a solution. The problem I see is that any future work is
more or less guaranteed to go to the winning company (because of system lock-
in, knowledge etc). So if you're a big company who can afford the upfront loss
you can still cash in in the future. Having the government as a permanent
customer is more or less the dream. I'm no expert though.

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bm1362
On a side note, there are a lot of hoops to actually work with 18F. I don't
blame the guy for just wanting to do a project and move on with his life.

~~~
TimHordern
Brendan would have had to jump through the hoops to work with 18F, including
the SAM validation. Unless you are talking about working directly for 18F as a
federal employee, which would have different levels of requirements.

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patsplat
Lower project bids reduce the level of commitment on the part of both the
client and contractor. With only $1 at risk, the amount of leverage the client
can exert over the work product is minimal.

Volunteering is not the same relationship as contracting, and carries
different kinds of project risk for the client.

Judging bids using price as the sole basis is easy, and poor procurement.

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orless
I think 18F should definitely allow negative bids as well.

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codingdave
If this were a legal project, and a lawyer bid to do it pro bono, nobody would
bat an eye. Why are we getting all riled up about it?

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zeckalpha
Given the tendency of HN toward libertarian and free market approaches, I've
been consistently surprised at the suggestions being made around this. This is
free markets gone right: A buyer and seller finding the most efficient price
for each.

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x5n1
The seller wasn't going for the profit motive however. The seller simply
wanted to work on the project as a volunteer. This is how he facilitated that.
There is no profit motive here, and so really it's not even a business
transaction, it's a volunteering oppurtunity.

~~~
Navarr
It's still 100% free market.

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iaw
There's a lot of crappy things that are 100% free market. Oligopolies come to
mind. Just because it's a free market solution doesn't mitigate the negative
experiences this person created for the other bidders.

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x5n1
Well the problem is self correcting. People will stop giving quality bids if
they don't think that there is any profit to be made because a bunch of
volunteers have destroyed the market. There is no problem here. Only that
anyone bidding should be aware that they won't get properly compensated for
their work and time.

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zardo
How is the market being destroyed correcting the problem? If people can't be
compensated and work doesn't get done, the market is a failure.

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iaw
The market isn't destroyed, it's just driven to zero. You can't force market
participants to behave in the fashion you want. The market being driven to
zero is one solution for the market, it optimizes for the people selling
services and the people buying them, it just doesn't optimize for the
profitability of those trying to make money off of selling their services.

