Okay, so back when Facebook was first valued at $50 billion I wrote a post proclaiming a new tech bubble.
But then a friend mentioned that it's not very meaningful to just say that we're in a bubble. The useful thing is to say when it will end, how much prices will drop, or at least what phase of the bubble we're in.
Touché. I didn't have an answer to that. But now I just ran into an interview on (shudder) TechCrunch that was actually very informative. It was with a tech investor, and I know what you're thinking, but he actually seems quite grounded and well-versed in the economic history of bubbles. I think he gives a pretty realistic picture of where we are.
In short, we're in the second or third phase of a bubble that was kicked off by Yuri Milner and Microsoft investing in Facebook at a $10-15 billion valuation. Then the second phase was high valuations of competitors like Twitter. And yes, the third phase will follow high-price purchases like Instagram at $1 billion. But I guess what really matters is the fact that it's not going to really get crazy (and crash soon after) until people stop worrying that it's a bubble and it's all fake. Buuuut I'm not sure that'll ever happen, given the memories of the last bubble. So I don't quite know how that plays out. In the end it seems we still have a few years before it all crashes to earth.
The video: “In the Studio,” CRV’s George Zachary Discusses Bubbles on the Eve of Facebook’s IPO - TechCrunch
Friday, May 11, 2012
Chainsawsuit puts it well, and then comically, as usual. To be clear, this isn't Hulu itself pushing for this, but instead the major studios (once again) trying to strangle it through restrictions. And it's not necessarily actually going to happen. Still, it's one more reason I suspect they're never going to learn, and we'll be forced to find some way to make them irrelevant.
Posted at 2:35 PM