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Summary:

There are plenty of job sites out there for freelancers who want to sell their time and skills in the global marketplace. Many of these – such as Elance or RentACoder – operate primarily as simple marketplaces, putting together buyers and sellers, transferring jobs and money, […]

There are plenty of job sites out there for freelancers who want to sell their time and skills in the global marketplace. Many of these – such as Elance or RentACoder – operate primarily as simple marketplaces, putting together buyers and sellers, transferring jobs and money, and providing simple dispute resolution services. The result has been what economic theory would predict in a market with more sellers than buyers: a relentless drive to low rates.

ScreenshotoDesk is a different sort of market for freelance developers, designers, and others. By focusing on some extra features, they’ve positioned oDesk as a place where both hourly rates and overall job sizes are somewhat large than the industry average (you can check out their oConomy community site for some aggregate information on jobs and rates). To do this, they add things for both buyers and sellers.

On the seller side of the equation – that is, if you’re a freelancer selling time – oDesk guarantees payment for jobs completed. Unlike some other sites, the freelancer doesn’t assume the risk of the buyer vanishing after the code is started. They also offer you a chance to prove basic skill levels by working through their own online certification tests. And of course, there’s that higher rates thing.

For buyers, oDesk offers increased control and assurance that freelancers are actually putting in the hours they say they are. Freelancers who take a job through oDesk are required to install the oDeskTeam application (versions for Windows, Mac, and Linux) that runs on their own computer to track what they’re up to. When a seller is “on the clock” for an oDesk job, oDeskTeam tracks computer activity and takes desktop (and optionally webcam) pictures at intervals, so that they buyer gets an online project diary showing what the seller was up to. This makes it a lot harder for sellers to pad their hours.

It’s an interesting bargain: give up some of your freelance freedom in return for higher rates. Does it work? The oDesk folks I chatted with point out that many of their sellers keep coming back for more work, and that they’ve been successful in promoting long-term relationships between happy buyers and happy sellers. And longer jobs means less time wasted hunting for work between short assignments. While the monitoring aspects of oDesk won’t be for everyone, if you’re willing to work in their system there are apparent benefits.

  1. Hmmm… is there a listing fee for buyers and/or sellers? What about restrictions for sellers or buyers just bypassing the system? I guess the tools they provide must be good to keep people glued to the system, otherwise the incentive to bypass a simple listing service is quite high, especially with referral and reputation-check services like LinkedIn growing in prominence…

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  2. Interesting article.

    @AaCc – there is no fee on the buyers site, just on the seller’s site and the tools are mainly designed for time-tracking and hence charging (e.g. if your keyboard/mouse remains inactive for a certain period of time then your timer stops charging time). Therefore there is an incentive on the buyer to continue using the site.

    I help on a different website for freelancers called http://www.peopleperhour.com and there are many features to encourage providers to use the site, like the escrow account, buyer feedback (leading to more work) etc.

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  3. AaCc: ODesk makes their money by charging buyers a fixed 10% of the payments. So the freelancer gets the full advertised amount, and the buyer sees a 10% markup in what they agreed to pay the freelancer.

    I also asked them about incentives for staying in the system, as opposed to hooking up directly after finding someone. On the seller side, the incentive is the ability to use the management tools. On the buyer side, the incentives are the payment guarantee and the history of referrals and positive feedback in their internal reputation system, which lead to a better chance of more jobs in the future.

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  4. I’ve used oDesk for several years now. It’s been extremely beneficial and easy to use. Going outside the oDesk system is addressed in http://www.odesk.com/community/User_Obligations Violations of these general obligations can result in suspension or termination of your account. As I’ve worked as support for a bit for oDesk, the general consensus is one year before contacting the buyer outside of the system. This may have changed recently.

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  5. I’ve been using oDesk for the better part of 2 years now as a seller. At this point, roughly 90% of my freelance work is done on the oDesk platform. Knowing that the oDesk Team app takes a screenshot every 10 minutes is a good incentive to stay on task , because let’s face it, as much as we like to say we have enough self-descipline to do this sort of work, there are times when ALL of us slip and start surfing WIkipedia for hours on end when we should be working… :)

    If I had to pick one feature of the platform I like the most, it would have to be the payment details. The 10% paid by the buyer coupled with the addition of Payoneer debit cards for payment last year made oDesk my favorite job site (GetAFreelancer is the only other service I know that provides Payoneer as a payment option). Not that there’s anything wrong with Paypal, but with Payoneer, I don’t have to wait a week to use my money.

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  6. Hi Mike,

    Just to let you know…pretty much all of the freelance markets now (guru, elance, etc.) offer both hourly and fixed price bidding. We at Rent a Coder are indeed lagging a bit in this department but will be offering this shortly. Also, all of the sites also offer certification. In fact, elance, Odesk and Rent a Coder all use the same company to do this and I have heard that Guru is talking with the same company to do the same thing.

    Odesk’s unique contribution is the desktop application and they deserve all the credit for it because it’s a great idea. However, just as they copied their competitors when they had problems with doing only hourly jobs (and adopted fixed pricing)…you can expect their competitors to do the same with a way to monitor hourly workers. This is great since competition is good for all consumers.

    Rod Smith
    http://www.RentACoder.com

    P.S. Keith, just so you know, Rent a Coder also offers Payoneer and I suspect other competitors probably do to, or are adding it soon.

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  7. Thanks for the updates, Rob. It’s pretty hard to keep up with this rapidly-changing industry; it’s good to hear that you’re planning improvements as well.

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  8. I’d be curious to know how oDesk tracks and confirms time spent away from the computer – such as on the phone or in person meetings with the client or time spent sketching or drawing ideas with pencil and paper. I suppose with a client meeting, the client wouldn’t be likely to question the time, but what about non-computer-based work time?

    The screen shot feature of the tracking software is a bit worrisome. What if out of 2 hours straight working on a project, I checked my email for 10 seconds and a sensitive email for another client was screenshot and sent? I don’t mind a tracker tracking my general activity – what programs I have open, how often I’m using the mouse/keyboard, etc., but it could be a real privacy issue.

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  9. Mike – Thanks for this post. We appreciate your interest in oDesk and the feedback from WWD readers.

    @AaCc – To clarify, it’s free for providers to join oDesk and free to apply to jobs. It’s also free to post jobs. oDesk only charges if you earn money. We keep 10% of any compensation that is earned through the system.

    @Rod – We agree that being able to verify remote work and track time is differentiated and oDesk is the only service that brings that capability. oDesk has also innovated in a number of other important ways. Some examples:

    **We are the only solution that guarantees payment to providers for hourly work
    **Other services may offer skills tests, but oDesk has invested in test quality at an entirely different level. See our blog post on this topic: http://www.odesk.com/blog/2008/01/power-of-community-feedback/
    **As far as I know, oDesk is the only service that offers free skills tests. Other services charge as much as $25/test. We want all of our providers to have a chance to validate their skills, so we don’t charge for the privilege of taking a test
    **While it is true that other services now support Payoneer, oDesk was the Payoneer pioneer :) …we were the first company to offer remote workers access to their earnings via a debit card
    **oDesk is very transparent. We expose an unparalleled amount of data about marketplace activities in the oConomy. This information helps both buyers and providers optimize their activities on oDesk.

    Best of all, we think the best innovations from oDesk are yet to come. We have several new announcements coming in the first half of this year that we believe will again be game-changing for this space.

    Best,

    Brian
    oDesk

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  10. @NatalieMac – Providers are able to enter time spent away from the computer as “offline” time. We don’t guarantee payment for offline time (e.g., the buyer can dispute the time), so we encourage buyers and providers to discuss expectations for this type of work before it happens.

    We take privacy very seriously and oDeskTeam has a number of privacy features built in. For instance, oDeskTeam will show you a balloon notification (e.g., a task tray pop-up like the one you might get if someone pings you on Skype) whenever it takes a screenshot. You can discard the screenshot before it is uploaded to oDesk if you wish. You can even delete screenshots from your oDesk work diary after upload if needed. Many of these settings are configurable, so you can configure a work environment that works for you.

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