The growth of the internet in the developing world is having unexpected consequences for global labour markets and opening the gates for thousands of people to compete for business that once they could have only dreamt about.

Australian crowd sourcing services such as 99designs and DesignCrowd have enabled designers in India, China and elsewhere to bid for and complete contracts with large companies in the Western world, often at massively discounted rates.

The largest crowd sourcing site by projects and web traffic is operated by Australian company Freelancer, which has outsourced more than $US60 million ($67 million) in projects.

The chief executive of Freelancer, Matt Barrie, says online outsourcing is the next big thing being enabled by the internet. He describes it as eBay, except involving buying and selling services rather than goods.

"There are 6.8 billion people in the world today and 75 per cent have not used the internet yet," Barrie says. "And they are connecting now and their average wage is between $1 and $5 per day. So there is a huge amount of labour coming into the market."

He says people in the developing world could charge premium rates over what they would earn for doing a similar job in their own country but that translated to a tenth of the cost that a Western supplier might charge.

Common services outsourced through Freelancer include website development, mechanical design and accounting but Barrie says almost anything is possible.

"I bet the guys at work that if I posted a job asking for a lion tamer, someone would bid on the project," Barrie said. "I posted the job and got one guy who worked at a circus and one guy who worked at a zoo."

Jobs have included rendering a 3D model of a house, completed for $US98, putting up posters at universities in Estonia for $US50, developing a formula for a paint coating for $US800, composing a rap song to help Chinese students learn English for $US102 and hydrogen engine research for $US484. Students have also used the service to get maths homework done at $US2 a question.

Barrie says his team pulls down jobs of a dubious moral or legal standing.

"We frown on homework but trying to stop some of these things that are not technically illegal is very hard," Barrie says. "If we bring things down, people just obfuscate them. But kids have cheated since time began and we need to think of different ways to overcome it."

It is not just small businesses using these services. The design service DesignCrowd has been used by Harvard Business School's Innovation and Growth Research Centre, the Fair Trade Association of Australia and New Zealand and the British sports footwear company, Hi-Tec.

The US satellite TV provider DISH Network used 99designs to redesign the branding on its service vehicles, while digital television services TiVo used the service to design webpage banners and email marketing campaigns.

One large business to embrace crowd sourcing is Deloitte Australia. Partner and chief executive of Deloitte Digital, Peter Williams, says the organisation's innovation strategy was structured to take advantage of the knowledge of its 4500 staff.

"We created a platform called the Idea Academy," Williams says. "It's like a social-media tool for entering ideas and then uses the votes to surface up the best ideas."

One idea to come back was the Emue Card, a credit card with an embedded keypad, display and microprocessor that is used for authenticating web and telephone-based transactions. It has been created as a spin-out company.

Deloitte regularly runs crowd-source brainstorming sessions for clients including Qantas, Telstra and Woolworths, generating about 1000 ideas each time. Williams says he encouraged clients to open their data, recruit a community and engage them to do development and innovation work.

"Ninety per cent of what comes out will be crap but you would have never thought of 10 per cent of the stuff," Williams says. "We just think it's a pretty extraordinary thing - it allows innovation to happen that you would never have dreamt of."

Source: smh.com.au