Scott Rosenberg, a Salon co-founder, blasts media corps that lost money on the Bubble in a book review on Salon.com today. One of the more bizarre claims Rosenberg offers concerns the bamboozling of investors: So we know who got bamboozled. But who did the bamboozling? There really are no culprits — aside from one sad … Continue reading “Who blew the Internet bubble?”
Scott Rosenberg, a Salon co-founder, blasts media corps that lost money on the Bubble in a book review on Salon.com today. One of the more bizarre claims Rosenberg offers concerns the bamboozling of investors:
So we know who got bamboozled. But who did the bamboozling? There really are no culprits — aside from one sad account of software hustlers actually defrauding the folks at the Hollywood talent agency CAA. Mostly, the media barons bamboozled themselves; the fear of losing turf to a new generation of technology, and later, the lure of quick Internet riches, motivated them to make costly decisions out of ignorance — to invest in Web ventures that any observer who actually used the Internet could see were poorly conceived and doomed to fail.
Salon raised millions of dollars from investors, through venture capital and an IPO, all gone now that their stock trades for pennies a share. But Salon didn’t bamboozle these investors, and in fact Salon “gets the Internet” in a way that media don’t. OK, Scott, if you say so.
Rosenberg gushes over “Small Pieces Loosely Joined” by Cluetrain Manifesto co-author Dave Weinberger, the thesis of which is that the Internet is personal, not corporate. While Weinberger’s quaint view of the ‘Net as a collection of cottages is charming, it’s just as misguided as media’s idea that the Net is just another outlet for advertising.
Would any sensible person mull over the question of whether the telephone is a personal or a corporate medium?
The immediate precursor of the Internet to the ordinary civilian was the telephone answering machine. Once he got used to leaving messages on a machine, it was a quick step to upgrading the machine to a fully interactive computer that does its messaging with text and graphics. So all the television/print/interactive shopping stuff about “convergence” is on some parallel track that remains to be assimilated on a large scale, and will stay that way until there’s a compelling reason for it.
Television, thanks to Replay and Tivo, is becoming less interactive, not more. Shopping on the Home Shopping Network sucks compared to web shopping at stores or at E-Bay. And print is just a source of blog starting-points these days. So actually, Rosenberg is right to blast the author who said:
“Web content is dead,” “digital dreams have been deferred for ‘broadband,'” and “AOL Time Warner will dominate.”
Actually, the Internet never stopped growing despite the collapse of the Bubble: user demand for broadband connections remains high, spurring a 20-30% annual growth rate; e-mail is a part of everyday life for both business and personal communication, everybody surfs the web, and one day soon, everyone will have a blog. Corporations still use the Net for customer service and to provide product information, and they’ll continue to do this.
But the Bubble was most certainly the work of a group of people who did in fact bamboozle millions of individual investors out of billions of dollars. Until this fact is recognized, and at least some of them are held accountable, the Tech market is not going to recover, and a cloud will remain over Internet-related tech businesses. One of the reasons these people were able to pull off the swindle was that the press didn’t do their job of criticizing the Bubble’s evangelists, because they were on the bandwagon themselves. There’s the story I’d like to read a book on.
