The BBC has a real problem with social media. It's delighted when something new appears. It slips into the patrician role that comes naturally to broadcasters – and especially the BBC. It can express childlike wonderment – Wow! – at something new and amazing. Getting beyond that though, is where the trouble starts. Perhaps the …
Andrew is completely correct. However, it is not just TV (all channels) who are sinners in this respect.
Much of the mainstream press* have an appreciation of "Technology" which is in the same vein with just a few notable exceptions.
*This of course excludes a lot of online media, and the specialist mags to which I subscribe.
It could be the ripple effect from the actions of a certain antipodean who has (allegedly) single-handedly reduced the standards of mass-media to something lower than that of most pre-school comics.
"It could be the ripple effect from the actions of a certain antipodean who has (allegedly) single-handedly reduced the standards of mass-media to something lower than that of most pre-school comics."
What, Julian Assange?
I told you so
The Social Media bubble (and it is a bubble) will burst, even if social media as a concept remains. There, I'm now on record as having predicted it, but that doesn't make me the cause when it does!
Some notable successes though
"Many of the start-ups are simply third-party add-ons to Facebook...."
What about popular Facebook add-ons such as FarmVille and FishWorld? These are made by Zynga, a rather profitable company. Clearly there's a long tail of unprofitable companies, but that doesn't mean all investors are wrong.
Nothing wrong with games
Gaming is very social as LAN parties and MMRPGs like World of Warcraft have demonstrated. The platform they run is very uninteresting infrastructure and easily swapped which is why FarmVille runs on an iPhone and could just as easily be plugged into "Ping" as to anything else.
An interesting bubble
Generally in finance circles, people are very good at avoiding previous bubbles. There are exceptions. But it does hold true in many cases. The interesting thing here is that the darlings of the Web 2.0 era aren't managing to get IPOs running, which means that the general investing public are skeptical. The only money they have got is from VC and companies trying to get on the bandwagon.
I expect to see a bubble bursting, but with nothing like the ferocity of the dotcom bubble.
Bubbles are merely bull markets that have been puffed so much that your postie is asking you if it's worth a punt. Then, after a while the bull/sh.. turns to bear/sh... In general, then, it's more correct to say that people are very good at making bubbles, and the the truer that is of the population as a whole, the bigger the bubble.
Financial circles almost never avoid bubbles but are attracted to them like flies to shit. The reason: OPM - that's other people's money they're playing with so nothing can happen to them if things go wrong and they stand to make huge bonuses as long as things are going right. The media play along with all the bowel-wrenching financial commentary of "investors feeling confident", etc. because it's all good when it's good right? Rising asset prices are good and not inflation, right?
And your bank is involved in this game right now. They are taking cheap money from the government and giving it to fuckwits in the hope of discovering the next Geek Pie*.
Is the reason that even Newsnight is providing bland, cheerleading comment, that the journos concerned simply don't understand? Or are too young to have really experienced the last bubble bursting?
In fact can anyone name a regular journo in the newspaper or mainstream TV (Auntie or commercial) that a) gets it and b) is allowed to make their views known?
Echoing the comments above, a good article, but focussing solely on the BBC is perhaps a little narrow in scope. It's simply baffling that Facebook has valuations of $70bn thrown around, Twitter a few billion, Groupon similarly, and yet there isn't so much as a peep from media channels that should really know better. They watched the tech bubble and burst 10 years ago; they've seen the (lack of) revenue stream for some of these businesses; heck, somewhere they must have a single contributor who questions how much Facebook is dependent on fads - and why it's different from MySpace of 2004 - and yet still nothing.
I've seen one mention, in a headline roundup, of Fox News (Fox News!?) asking timidly whether perhaps these valuations might spell a bubble, but little else. Which I guess is how bubbles grow...
Christ on a bicycle.
Fantastic. This is the same Julie Mayer who backed notable technology inovater Spinvox (who I recall you're familar with Andrew), and Ernst Malmstein, who I had the pleasure of working for back in 2000. I say pleasure because I was a contractor, and so unlike most of the other 400 or so poor souls there I was paid for my last three months work.
I wouldn't trust either of them to run a branch of Dixons, let alone a tech company. But perhaps I'm playing the man unfairly, particularly when the ball is in such easy reach now that Facebook has a market cap of roughly $82 billion on the secondary market. Roughly the same as the GDP of Slovakia. Given China's current balance of trade, they could afford to buy the whole company in a mere 11 years.
Can anyone tell me what they produce? Anyone? OK, they're a service company, what do they charge for their service? Still nothing? OK, they're a media company, selling media space and marketing to their customers, like (say) News Corp. Like 'em or hate em, Rupert Murdochs's empire brings in $33bn a year in revenue with a market value of about $14bn. Facebook is worth five times that, pulls in 1/20th of the revenue ($1.6bn, extrapolated from their leaked financials), and is STILL looking for external funding. Personally I'd rather invest in British coal mining.
I'm two pints in after lunch and that's a bit ranty, but sweet Jesus, this is obvious right? Schoolboy stuff.
I guess the moral of the story is that we financial geniuses who can see this bubble for what it is can keep our investments out of it, whereas the numpties who run the nation's pension funds presumably have trouble even *spelling* economics.
Fortunately, as the article notes, there won't be quite the bang that there was a decade ago. Unfortunately, that's because these same idiots have already lost all our money in the banking system.
Mines the one with my life savings in used notes in the pocket.
Fantastic comment on Facebook's valuation.
I heard (I am aware I may end up being wrong) that there is chat about Facebook getting a 50x PE multiple on their current valuation....
That is akin to saying that if any mug were to take the reins today they could run the company at its current profitability for 50 years... that is a very simplistic way of putting it, as PE also takes into account the assumption of growth and the aforementioned definition would better be suited to a mature company... but 50!!!! Seriously?!?
How long did it take the fall of MySpace to happen... 5 - 6 years? I do take the point that facebook is bigger but that also means they can't rely on explosive growth and instead have to focus on monetizing exiting users which is certainly possible, but, come on! Microsoft only has a 20x PE!
Investors don't avoid bubbles, they create them.
I live in Shoreditch and work in IT (although, not in a tech start up, but I do get to write in trendy Python occasionally) and I hadn't heard of this bar...
Then I realised it was made up. Fail.
(I've had quite a few pints already)
I run a few websites for "fun" as a hobby. So basically FB is worth at best maybe 800 Million, not 89,000 Million.
Sounds like some people set to lose 99% of their investments.
How do I make money from FB being devalued 90% in the next few years? Is there any way?
Become a partner in Goldman Sachs and bet against your customers with their money. If an IPO is ever forthcoming buy options on falling prices or just nakedly short sell - much the same thing.
Other than that: remove your money from any investment that is possibly involved in any other myriad pyramid schemes out there. Yes, your mattress is probably safer than anything other than treasury gilts at the moment, although the yields are being held artificially down by QE. Actually given the inflationary pressures in the UK at the moment, indexed linked papers are possibly the best bet. But what would I know? I don't have a loud stripey shirt!
Don't take this as financial advice, but there is a device for betting on the loss of a stock; short sales. Basically you sell the stock at the current price on borrowed money then buy it later at the lower price. Backwards stock trading. Or something.
But it does actually have to go down. Don't be bedazzled by the terms. If you wouldn't buy a regular stock, don't bother.
Eureka ....... Failsafe Code to Capture Top $Market Capitalisation
The problem with the BBC is, Andrew, that they struggle with the concept of reality, and arbitrary third party changes and zeroday alterations to scheduled status quo programming of puppet and muppet performers. .......... and do conspire very badly to avoid revealing the new virtual paradigm which leads and governs the future and humanity ...... with Immaculately Conceived Source Code from the Mother of All Lodes.
And Andrew, you're surely smart enough to know that that aint no April Fool Trick or Treat .... IT's the Real Thing reduced in AI to Singular Entanglement with JOINT Venturing Virtual Strings.
And there is/is there a curious symmetry and/or empathy/cold fusion between all that you now know of here, and here, http://www.theregister.co.uk/2011/04/08/ms_patch_tuesday_april_pre_alert/ ...... and here, http://heddinout.com/?p=2140
All your computers belong to us? ..... Legions Anonymous? :-)
The remarkable stealth that guarantees and delivers invisibility and impunity arrives with one's failure to believe what is freely shared and which you might begin to suspect is perfectly true however improbable your own programming would deem it to be, and then try to dismiss it, to not be.
As a recurring APT though, is it proven more likely to be exactly as it says that it is, with one's disbelief no barrier or hurdle to its existence and therefore likely media presentation to disprove the negative that closes off one's mind to the real possibilities which exist in virtual spheres of animal husbandry. ..... and virtual machine management and development ..... and global operating device maintenance and repair.
You should write corporate marketing bullshit for a living. You have that same talent of taking words we all know and recognise and fitting them together in such a way, which although it's technically grammatically correct, makes no sense whatsoever and is totally impossible to focus on beyond the first sentence. Well done, very impressive!
BBC not doing tech. Really...
The last two radio 4 editions of Unreliable Evidence have had me screaming. The first one (about patent law) passingly said "maybe, in some sciences, people might invent the same idea" (laugh at preposterous idea) while completely ignoring how patents are fscking the computer industry (populated with people employed to solve the same problems). The most recent seemed to be claiming that it's impossible to define a coherent set of rules for tax legislation - something I suspect an industry full of people used to encoding very specific behaviour might be able to handle. Radio 4 quiz shows consider an in-depth knowledge of 18th century poets to be trivial but the Fibonacci sequence or placing electoral candidates in order of preference to be a dark art.
BBC TV struggles to get science past the basics of Horizon, and generally seems to consist of trying to get me to seek out and punch Brian Cox. I maintain that the average school child these days has vastly more scientific, computing and mathematical background than the people tasked with making programmes (possibly because they all did arts degrees...) so it'll take time for real life to intervene. It's only because enough actors grew up in the 80s and someone noticed that you could use computers for email that we've got people actually using keyboards properly.
Not that it's just the BBC. It's taken years for film studios to make a passing concession to the kind of science that a ten year old wouldn't call out as bogus (it doesn't help that the last guy to suggest they try to make it make sense carelessly tried to put rulls on it, and then got laughed at by the media who, of course, can't tell science from fantasy; that put the kibosh on anyone trying to make a reasonable point about gratuitous deviations from plausibility). CSI this week had someone find a "resistor" (fair do, it looked like a resistor) from a bomb, which "delayed the flow of electricity through the wire, by a minute in this case" and nearly caused a fatality as I choked on my supper.
The BBC doesn't seem to have got the idea that you shouldn't drag in the guy you think is an expert, at least on tech - you should ask someone you think is an expert who *they* think is an expert, and repeat until you loop. The media (tech media mostly excepted) need to accept that there's a significant proportion of their audience who know a *lot* more than they do. All the kids who spent the 90s playing computer games have grown up, and they (along with us hard core geeks from longer ago) can spot a journalist - or writer - being an idiot. And we *do* mind.
Good post, but don't be too hard on CSI (which I have only seen a few times). A resistor would be essential for delaying the charging of a capacitor, if detonation would occur when the cap was fully charged. Only surmising, though.
It's a childs world!
Very true that there is no TV left for grown-ups.
It is easy to see why when those attempting intelligent conversation keep getting derided by their thickie accomplices
Early retirement beckons so that the thickies can get 100% control.
Too interested in the arts, or occasionally sport. Technical ability generally pretty poor, in fact most consider having to deal properly with technology beneath them. They'll be first in line for an Apple iPad / iPhone but only for the pose value.
Consider: http://www.theregister.co.uk/2011/04/07/bcc_mps_report/ - what a waste. Engineers in the BBC used to have a route to the senior management, no longer. It's now top filled with ex-journalists (Thompson) or accountants with no understanding of the systems and support needed to create and deliver content. No understanding of what they've agreed to buy from Siemens or the various transmitter companies.
How to spot a Bubble.
As soon as the pundits start saying it isn't a bubble, and explaining why this time it really is different, then you know that the bubble is well under inflation.
If Rory v Spinvox is the best the BBC can do...
...then it's worse than we thought. So to help, I thought I'd add the following BBC journalist-friendly explanation...
Spinvox works like the BBC tech newsroom. People call in with stories (voicemail messages) which the tech reporter (computer based speech recognition) attempts to convert to news packages (text messages) without necessarily having any understanding of what each story (voicemail message) is about.
However, unlike the BBC tech journalist, the Spinvox computer speech recognition system was smart enough to recognize when it didn't understand parts of the message and would hand it off to an expert (ie, human being) for validation. The decision of the expert was then fed back to the automated speech recognition system in order to improve the quality of future results. I guess the tech newsroom equivalent would be like asking a domain expert for comment on the story - and then actually learning from the response in order to improve the quality of future reporting.
So Spinvox were busy trying to build a technically challenging hybrid speech recognition and expert system, and all Rory could latch onto was the fact that there were quite a lot of humans being used in the training loop, which to him meant that....
ALL UR TRANSLASHUNZ ARE DUN BY HUMANZ
And Rory's super secret source for this story? Maybe the fact that the use of human beings in the training context was already fully documented on the Spinvox website.
There are lessons to be learned from Spinvox - just not the ones Rory was so obsessed with. The main failings came from the huge pressure from investors to scale up far faster than the business could cope with. The lesson to take home from this is not to let the VCs take control of your business. They're only any good at creating bubbles - not viable tech businesses.
FAIL - because it was.
Can't let that one slide by.
The issue is how often the message was handed to a human, and as I recall this number was far higher than Spinvox made out.
Machine conversion of "Please call me back at home" to text makes an investable product, but converting it to to "_ _ _ back _ _" necessitates human intervention, and turns your company from a technology startup with massive potential for scaling, to an outsourcing company; one which (as I recall) was losing money on each manually transcribed message.
I agree there were many problems with Spinvox - more than you know - but the "human problem" was certainly one of them.
Tech bubble? Yes. As bad as 1999? No.
"And your bank is involved in this game right now. They are taking cheap money from the government and giving it to fuckwits in the hope of discovering the next Geek Pie*"
Mine's not. I am with a local bank. MOST banks were not involved with this. They did not do anything with these stupid credit default swaps, didn't lose their ass on stuff like that, so they did not have to whine to the gov't for a bailout (which those banks should NOT have gotten -- they should have been allowed to go bankrupt, competent banks would have bought the mortgages and accounts at firesale prices, strengthening the competent banks. Free market in action.)
Is there a tech bubble? Absolutely. There are, again, loads of companies that are providing service with little plan for making money, and yet valued at millions, 100s of millions, or even billions of dollars.
HOWEVER, is it as bad as the 90s? I don't think so. In the 90s, there were companies like WebVan, which would buy your groceries and deliver them to your home with NO MARKUP (assuming they'd somehow make money with enough volume), companies that'd ship 50 pound bags of dogfood (ignoring the fact the significant shipping costs outweigh any savings compared to just buying it at the store), all kinds of services that cost REAL MONEY with no charges to cover those expenses. The plan was "we are losing money on every single customer, but if we get A LOT of customers, we'll somehow become profitable."
Now, most of these bubble companies are massively overvalued, but social services can be run very inexpensively (how much computing power does it probably take to generate a tweet? Not much. And the humans generating the content aren't paid at all), so it seems to me even though banner ads don't pay much, they may be able to make enough from ads to at least be marginally profitable.
Television and technology
As AC has pointed out, technical staff are no longer accepted into the upper echelons of the BBC.
However, there is another reason for TV production teams' failure to grasp science and technology: the people who work in them see pictures as the main means of storing and passing on human knowledge. Since they work in a visual medium, that is, after all, what they need to provide.
This also explains why audio standards in television have dropped: production teams don't _see_ the need for high-quality recording.
It's difficult for lowly-paid, inexperienced, junior researchers to appreciate that not everyone perceives the world visually (or at least that others can perceive mathematical formulae, statistics or even elegant language), because they move among visually-orientated colleagues. Producers, directors and the like should have more experience, but it has usually been gained by going in ever-decreasing professional circles: if anything, their _view_ of the world is even more restricted.
If you want analysis, don't look for it from television: talk radio and the printed word are much richer seams to mine.
Now that's a point I'd never considered and it explains behaviour I've seen here at the ABC (Aussie, that is). I'd always put it down to the perpetrators having "soft" arts degrees* devoid of any requirement for critical thinking. I may have been completely wrong and it's intrinsic to the production of the medium rather than those producing it. That would explain many things about the nature of TV and film production.
I like a day when I've been presented with a new idea before 9AM...
* I should clarrify, I mean degree courses with soft options, not that arts degrees are all soft...
Buy the man a pint.
"A focus on the web means the journalist can avoid all that complicated stuff like science – some of which, apparently, smells quite unpleasant. Far easier to mystify it."
Well said. The same attitude permeates all science programmes on every channel in the UK. Lots of "Gee whizz wow" and no hard facts or complex reasoning. As for kid's shows, watch "Nina and the Neurons" to see just how bad it can get. No wonder our children are useless at the hard sciences.