I have a larger article coming on this topic tomorrow but after catching Dvorak's column on Bubble 2.0 Coming Soon, I had to say something. While I have been concerned about another Bubble/Bust since 2005 or so – and have been planning accordingly – I think he's horribly wrong on a couple fronts… but here's the one that irks me the most:
Here is another concept that has been in play since the mid-1990s. It cannot trigger a collapse since it will never fully get off the ground, although the iPhone mania may be a bad sign of something.
What? I was involved in a couple different mobile efforts circa '99/'00 then again in 2004 and extensively through the last 18 months, they were each completely and fundamentally different than they are now on a variety of fronts.
First, it was predominantly dial up. No, I don't mean dial up speeds, I mean actual dial up. I recently found one of the old Merlin cards – from '99/'00 – in my junk box and was reminded of the difficulties. It was expensive, maxed out at 28.8k, still required a dial in account, and the connection would drop out if you looked at it funny. I built inventory management applications in both '00 and '04 and doing anything was difficult at best.
Second, few understood the technology at any level. Most companies expected you to visit their normal web site and look at their predominantly static content or use their shopping cart. Few realized that shopping carts were not an attention-grabber. My first development in '00 was on the Vadem Clio – still have one – and although it supported the Merlin card, it didn't have a way to use 802.11 wireless. Even in '04 when I worked extensively with various Symbol products in '04, getting GPRS connectivity required numous conference calls with New Mexico, South Africa, and a few other places. Everyone though that giving people "mobile solutions" would be as simple as pointing a browser at a site… not quite. Now, devices have the hardware built in and can often transition between networks transparently to the user. They don't need to know the modem codes, they turn it on.
Next, the big boys hadn't figured it out. It's only in the past two years that news organizations have figured out that frequently-updated-time-sensitive content is one of the best things to make freely available. Yes, charging individuals for mobile access could bring in revenue, but when you have hundreds of competitors, most users will move on. Instead, content providers can make some (or all) of their content for free, build brand loyalty, and build revenue models based on other aspects.
Finally, the revenue model has shifted. Think back to '00, the concept of "context-sensitive advertising" was in its infancy. Only the geeks knew about Google and many of us had given up on search engines due to porn spam. Today we're still getting annoyed by banner ads but the content and ads that do make it through our personal and shared filters is more focused, relevant, and interesting. Most people don't realize that, but it's powerful. During the dotCom Bubble, you paid to get your ad in front of a 1000 random people…. now you pay to get your ad in front of 50 people looking for specific terms or phrases.
So Keith, do you think a Bubble is here or coming?
As noted previously, I've been concerned about it – and hedging against it – for over two years. I think that many of the Web2.0 companies are going to crash and burn – I watch the the TechCrunch deadpool closely – but this time around there is a fraction of the money involved, a fraction of the people involved, and the climate has completely changed. Therefore, any collapse that happens should be softer and more focused on specific segments within the technology space. That said, I don't believe it's coming in the mobile web space. I think things are still embryonic enough that only a small portion of the big dollars are coming in. The key will be to for those organizations to be prepared to jump in and out when its appropriate… stay tuned for tomorrow. 😉