virtualeconomics

Learning to be the guy who turned down the Beatles

In a recent post I talked about the media tech bubble ("of course it's a bubble"), hypothesising that the clearest sign of a bubble is that every single IPO is being priced as if it's the next Google...which of course they can't all be. So some brief thoughts on why this might be.

Nobody wants to be the guy who turned down the next Beatles (or the next J K Rowling, or perhaps more germanely the next Google) - every industry has its legendary poor dumb bastard, "that guy" who had the Next Big Thing sitting right across his desk and passed. I've worked on acquisition strategies before with people who seemed more concerned than was entirely healthy that they not be "that guy".

BT Fon simply doesn't work

When BT first took an investment in Fon I thought it a great innovation. The ex-monopoly doing something innovative and useful that would leverage its assets (near-universal coverage) and provide a real consumer benefit.

Problem is, it doesn't work. I've tried using Fon when I'm away from proper wireless access a couple of times and it does one of three things:

(1) works until the connection just vanishes indefinitely

(2) works but requires you to log back in every few minutes or

(3) works but requires you to turn the connection on and off every few minutes

I lost and manually reaquired my Fon connection twelve times in the course of writing that last post. It isn't even a very long post and I wasn't doing much else at the same time.

Of course it's a bubble

Marc Andreesen argues it's not a bubble because the big tech companies - Google, Apple - still have sensible P/E valuations and anyway it can't be a bubble if everyone calls it one. Let's look at some counterpoints.

Facebook, Zynga, Zipcar, LinkedIn, Demand Media, Twitter, iwantadoor.com (yes indeed) and yesterday's big story, Groupon.

What makes all these companies signs of a bubble? Everything is priced as if this market has no losers. Everything is priced to win, win big, face no competition, face no meaningful downside risk and not "do a MySpace". 

Please sponsor me

(Off topic, of course). In a couple of weeks my father and I will be walking the 18 miles of the Timble Trail in aid of Wheatfield's Hospice, a palliative care unit in Yorkshire. If you've ever found my blog useful or informative, here's the chance you've been looking for to do something nice for me and punt me a few quid in sponsorship. Also, if you've read this far and don't yet know that Virgin Money now offers a non-profit charitable giving website that you should use for your own fundraising (instead of Justgiving, which is a for-profit and skims some off the top), there's some more free advice about online media. Just so it's not all off-topic. 

Oh what a lovely bubble!

LinkedIn doubled in the first day of its IPO, Facebook is heading to $100 billion before it even floats, higher education might be a bubble, silver had a stab at being a bubble, commodity prices have become uncoupled from demand and China is hoarding rare earth metals. But if you're looking for the perfect bubble, Bitcoin looks like a great bet.

If you don't already know what Bitcoin is, it will take several minutes of reading largely inpenetrable articles to find out. Here's Wikipedia. Here's an explanation from Tim Lee. Here's Tyler Cowen. Bitcoin is a peer-to-peer virtual currency that's better, in various arguable ways, than other virtual currencies like Beenz or e-gold or Azeroth gold coins. A handful of technophiles accept it as payment. There's lots of ways to trade it. It's an internet currency that fulfils the standard criteria for being considered money and you can buy some right now, if you want.

A new role at Holidayextras

I'm very pleased to say that in a couple of months I'll be taking up a new position as Editor-in-Chief at Holidayextras.co.uk.

As well as looking after existing PR and SEO teams - something Holidayextras already does brilliantly, so it's a good place for me to learn more about that side of the content business - I'll be recruiting, training and managing new teams of freelance writers to cover the UK's major airports. (If you're interested in talking to me about that opportunity or know someone who would be, therefore, do get in touch - contact details are at the top of the page. I'm particularly keen to hear from writers I've worked with before, since you've already been through a lot of the relevant training. Writers who know their airports also eagerly sought.)

I left localpeople last November planning to take a year or so off to play with my twins. The Holidayextras opportunity was sufficiently interesting to drag me away from that break early. They're already doing a great job of exploiting a lucrative niche in one of the UK's largest online markets. The company consistently wins prizes for being not just a good place to work but one of the top 100 companies in the country. Most of all it's an opportunity to work with some excellent people do something I enjoy - building up new teams of writers and making content a measurably valuable part of the business rather than a cost centre.

I start on Monday July 18th, just six short days after the (very) long awaited latest volume of George R R Martin's Song of Ice and Fire comes out, so I already know how I'll be spending the last few days of my year off - reading very quickly. I've got lots to look forward to in July.

In search of lost nostalgia

If I'm reading a book, I can remember what page I'm on. It's hardly a superpower or a talent, barely even worthy of being called a trick, but I find it a slightly useful propensity - reading just before I go to sleep I wake up, pick up the book and think "ah, I stopped at page one hundred and forty seven. About halfway down". It saves a little skimming, a little re-reading, the odd accidental spoiler. And while I know that technology as basic as a bookmark - for which read absolutely any scrap of paper that happens to be lying about - would do the same job, it amuses me to be able to do it.

When I first got a Kindle at the end of last October (a kind parting gift from my lovely colleagues at Northcliffe) there was a lot about it I liked. The thing I disliked about it - and I disliked it viscerally, almost as a personal affront - was that my my utterly trivial mental trick of remembering page numbers had been rendered even less useful than it was before. The Kindle knew what page I was on. I need never remember a page number again.

Startup100 riggers just Wronga

By now you'll have seen Mike Butcher's piece on TechCrunch about the results of last month's Startup100 awards. Wonga was voted the winner, but at the last minute Spotify was jobbed in to win the prize. So far so nefarious, but the worst bit is that the vote was only rigged because some of the people running the award are apparently too stupid to understand the benefits of short-term lending so don't want to be associated with it.

The folly of rigging your own awards ceremony has been sufficiently addressed by Mike (and it is telling that the Telegraph's reponse to this is basically to wash their hands of the whole affair, little more than "a big boy did it and ran away"). It is the apparent misapprehension of the organisers that Wonga is doing something disreputable that I wish to address, by looking at the basic economics of short-term lending and the small amount of research that has been done on this market.

A citizen journalism model that really breaks news?

London-based citizen journalism start-up Blottr, which destealthed towards the end of February with a Techrunch write-up and recently announced a round of angel funding, led the news agenda for much of Monday by breaking the day's major UK news story. 

First publishing a few minutes after 10am, Blottr broke the news of a bomb alert in London and over the day added pictures, detail and coverage of the events in the square and the controlled explosion carried out in Trafalgar Square around 9am. Sky and the BBC picked up the story around 3 hours later, and Blottr founder Adam Baker told virtualeconomics:

"It was the only full story available of the incident for 3 hours, until Sky News put it as their "breaking" news, followed by the BBC. By this time, everyone discussing the story on Twitter (was) linking to our story, as the main source."

Adapt by Tim Harford

Tim Harford's third book, Adapt, is much braver than his first two.

The Undercover Economist, his first book, leapt on the post-Freakonomics enthusiasm for popular economics and - alongside Steven Lansberg, Tyler Cowen and others - explained how we can all use economic principles to make sense of our everyday lives. It was clever, fun and accessible: a better introduction than most to demystifying economic theory and making it actually useful to the man complaining about ticket prices on the Clapham omnibus. The Logic of Life, his second, told us simply that logic underlies even our most seemingly absurd decisions. Tim's narrative, that people act rationally even when they seem not to, drew examples and theory from the field of behavioural economics to tell the reader what was again an ultimately comforting and familiar story that helped them make more sense of their own life.

Where The Undercover Economist and The Logic of Life were reassuring, Adapt is confrontational.