Alice and Bob

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Revision as of 19:33, 12 February 2018 by Devon (talk | contribs) (Bob: The Bitcoin User)
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Migrating from the current centralized paradigm to a fully decentralized model requires bridges to help users make the transition. This is why we have built the Alexandria desktop client and web client. They can work with either centralized, web-server-based gateways, or with locally hosted, fully decentralized daemons. Both options provide the same core functionality and share the same data layer. Both options have a variety of incentives and tradeoffs. Finally, a third, hybrid option, is available for some processes to employ Ethereum (or counterparty, etc) smart contracts.

The following is an overview of the ecosystem from the perspective of each user. Each function of Open Index Protocol has its own requirements, costs and incentives.

The Two Primary Parties:

Alice: The Artist

Alice is an independent filmmaker frustrated with the stifling conditions of current content distribution options. Alice seeks a new way of distributing her work that would give her complete control over all aspects of it's release including terms of use, distribution quality, pricing options and automatic split payments. Alice is considering releasing her new film through Alexandria. To test the platform, she publishes a trailer of the film and opts to share the trailer for free. She finds the publishing process easy to understand and is impressed with the picture quality and smooth streaming of the platform so she shares the content with her social media followers like Bob.

Bob: The Bitcoin User

Bob is an enthusiastic user of Bitcoin and likes to check out new use cases. He sees the `#bitcoin` tag on Alice’s free film trailer. He watches is and enjoys it so much that he sends her a $1 tip right away. Then he discovers the “comment for micropayment” button and learns, for a small fee, that he can leave a comment on the trailer that will stay with it forever. He wants to encourage Alice’s release of the full film, so for just a fraction of a penny he comments “Awesome, high quality streaming experience!”

Alice receives Bob’s tip and encouragement which is soon followed by more tips and encouragement, so she decides to publish an original song from the film’s soundtrack. Alice sets the price at one cent per play and one dollar to purchase. She sets the retailer cut to 15% and the promoter cut to 15%. She finds that because she is charging one dollar for the song, her cost to publish is also one dollar. She uses some of her recently received BTC to pay the publishing fee and her song is published with her specific pricing and distribution preferences.

Other kinds of Bobs:

Charlie: The Centralized Client User

Charlie likes convenience and technology, in that order. He hears that Alexandria is the new platform to find high quality content like 4k video and lossless FLAC audio for less than half the price of other services and decides to check it out. He hasn't previously had a reason to use Bitcoin but he wants to listen to Alice’s soundtrack song so he quickly signs up for a Coinbase account and installs the Alexandria Everywhere chrome browser extension. Since Charlie’s priority is convenience, he sets his Coinbase account to auto-fill once a month like a subscription, and his browser extension preferences to auto-pay for content below the threshold of the price he sets. Now he is set for instant viewing and will not see paywalls.

Dan: The Decentralized Client User

Dan wants to use decentralized technology whenever possible - he runs a full node of the Bitcoin blockchain, the Ethereum blockchain and Alexandria’s content index, FLO blockchain. Dan values trust and privacy, so he became an Alexandria user because he can search and browse the Alexandria content index as a database file on his own computer. No one can spy on his activity. He also appreciates that he can easily send tips and payments using privacy oriented tokens. It makes it especially easy for Dan because the system automatically exchanges his privacy oriented tokens for the payment token each artist asks to receive. Dan discovers Alice’s film trailer and finds that the playback quality isn’t smooth like it is for Alice and Charlie because he is accessing the content via a peer to peer network. He sees that he can offer up a token bounty to ask other users to help seed the file. He decides to do this and by spending only $.50 he gives the film trailer a base seeding level for a year. After a moment he reloads the film trailer and it instantly plays smoothly.

Edgar: The Ethereum Lite-client User

Edgar is an Ethereum fan and likes to use it whenever possible. He downloads the Alexandria Ethereum client which is as resource-light as Charlie’s centralized client, but he considers it to be more trustworthy because he can pay the Ethereum network for cryptographic evidence that the content artifact hasn’t been altered.

Protocol Layer Service Providers:

Izzy: An Index Blockchain Miner

Izzy contributes Proof-of-Work to the blockchain where Alice’s content is published. As a blockchain miner, Izzy is already familiar with the various exchanges and markets but she is always keeping an eye out for good “set-it-and-forget-it” solutions that will give her reliable revenues. She was testing Alexandria’s auto-trading system because it offers an average margin of 15% over costs. When Alice needed tokens to publish her soundtrack song, Alexandria’s system auto traded the Bitcoin Alice was holding with tokens Izzy had mined and was offering for sale. Not only did Izzy's Alexandria mining experiment result in a 15% margin over her costs, but she received an additional bonus because she happened to mine the block in which Alice’s soundtrack song was published, so she also received the $1.00 fee Alice paid. Izzy deems the experiment a success and increases her hash rate.

Sam: A Storage and Distribution Miner

Sam contributes to Alexandria in the form of disk storage space and bandwidth. His work is responsible for getting the content to the audience. When Dan offered a token bounty to help Alice’s film trailer play smoothly, Sam received some of the tokens and became one of the new seeders.

Application Layer Service Providers:

Pat: A Promoter

Pat is an influencer - she loves sharing on social media and she has a large following. She sees a post from her college roommate, Alice, about how she is independently selling her movie on Alexandria and becomes curious about the new platform. She learns about the promoters program, sees that Alice is offering 15% to promoters and decides to give the program a try by sharing Alice’s film. Pat starts a social media campaign, and the stars align such that Pat’s followers are the perfect fit for Alice’s film, wildly increasing demand for it.

RadNewApp: A Retailer

RadNewApp is a recent startup with all kinds of buzz. Its founders chose to build their application on the Open Index Protocol. They were able to leverage their deep understanding of content suggestion algorithms to become a major competitor with Alexandria. RadNewApp's suggestion algorithm is used to put Alice’s film in front of a large group of users who purchase it, earning the company a 15% cut of Alice’s sales.

Victor: The Verifier

Victor runs a full node of FLO blockchain and watches the Ethereum network for verification requests. He then competes with other nodes in a gamification system to win payments for providing the requested verifications. Victor’s role provides Edgar a trustworthy but convenient lite-client experience.

Protocol and Application Layer Service Provider Backers

Mike: The Market Maker

Mike is a passionate follower of decentralized technology. He is willing to assume some limited risk in exchange for the opportunity to serve as a market maker in the Alexandria ecosystem.

Demand side

As the Alexandria ecosystem is getting started, Mike the market maker serves as the bridge between the production of the tokens by miners Izzy and Sam and the demand for the tokens from artists like Alice and users like Bob. Mike pays Izzy and Sam a mutually agreed upon market determined daily rate to rent their mining efforts, and then he holds the earned tokens until there is demand for them. His incentive is a reliable margin.

Supply side

When Pat’s promoter work makes Alice’s film go viral, other artists like Alice recognize an enormous opportunity and rush to publish their work on Alexandria. When the demand for publishing tokens outpaces the newly mined supply, Mike offers publishing tokens he purchased on the open market to meet this demand. After the tokens are sold, a script then arbitrages the money he received to replace the tokens. His risk is that he may not be able to arbitrage the tokens back, but if he is successful he will make a significant daily return.

 See also