virtualeconomics

Six signs of a new net bubble

I've been thinking about the new Internet bubble for a while: today I saw what, for me, clinched it that the bubble is back. Here, in order, are the six signs that we're in a new net bubble.

(1) Hugely improbable specialist etailers like iwantadoor.com advertising (indeed sponsoring) prime-time TV shows. When I saw them appear in the sponsorship slot tonight I immediately knew I was looking at the next Pets.com. That's not a happy connection for any company and it's not a happy moment for our market. 

(2) Massive valuations placed on stocks that have never returned a profit. Demand Media (even with all its weird accounting) still wasn't making a profit when it got listed at $2bn. HuffPo just got bought as it went into marginal profitability. People are spending billions to own businesses that have yet to return a penny. That's not healthy, rational investing. That's dumb money hitching itself to a rising bandwagon (yes, I just said "rising bandwagon") and hoping to offload the shares before it falls. 

You know what's not cool? Stealing seventy billion dollars

It turns out that, as Egypt continues to fight to kick Mubarak out, that he and his family have somehow stashed $70 billion (that's right, with a "b") in banks across the world.

I'm sure you've noticed over the past ten years that trying to get your bank to give you your own money has become more and more complicated and onerous. "Money laundering" regulations apparently require financial institutions to pester us for utility bills, passports and the answers to immemorable security questions before we can see, let alone withdraw, our own cash.

Well, here's a modest proposal. Mubarak has stolen about $70 billion from a country that is about to kick him out. If these international agreements on money-laundering and identity checks are good for anything at all, can we use them to make sure he gives it back? Or, if not, admit that the whole thing is pointless and stop wasting everyone's time with them?

A big society of millionaires?

News that the coalition's Big Society Tsar, Lord Wei, 'is to scale back his hours after discovering that working for free three days a week is incompatible with "having a life"' proves once again that life imitates not so much art as satire. Like The Onion's "fuck everything we're doing five blades" or Daily Mash's once-imaginery TV show "America's fattest bitch", satire finds itself the shortest step behind reality when the man in charge of getting people to give up their time for the Big Society realises he simply hasn't the time.

In fact, the only people who seem able to afford the time to work for the still-nascent Big Society for nothing are those with no need to earn a living - millionaires like Martha Lane Fox and Lord Heseltine. 

Which perhaps suggests an opportunity to kill two birds with one stone.

BskyB prepares to compete with BT for the UK's next mobile market

BskyB buying The Cloud isn't interesting because it positions them to compete with BT for on-the-move wifi access. It's interesting because it positions both companies to be currently the only players in the next mobile market. 

What we quaintly call our mobile phones are increasingly obviously just sub-scale computers. On a train today I used mine as a 16 gig music player, a Twitter station, a Kindle and a text-messaging system. Next time I buy a phone it'll be the biggest tablet I can fit in my pocket - a reality Tmobile's data cap seems to obviously reflect. Or to put it another way, my need for mobile Internet access on my "phone" so vastly exceeds my need for voice telephony that the market BT, and now Sky, are getting into is the sort of universal Internet access both home and away that will form the basis of my next "mobile phone" contract.

So it's a smart move from Sky, but not one to compete with BT so much as to join BT in eliminating Vodafone, Tmobile, Orange and O2 over the next few years. Voice is increasingly a needles luxury on a mobile phone, especially when it's still used to lock you in to long contracts that can be avoided by going without.  

(Photo from sklathill on Flickr)

Some unlimiteds are more equal than others: Tmobile's "fair use" redefinition continues

Last week Tmobile caused a bit of a stir by announcing that their allegedly "unlimited" mobile Internet browsing would be capped at half a gig. At the time I guessed it was to stop people just sticking their old SIM in a tablet. Today, I discovered that actually it's just a ploy to charge customers to get that cap raised.

When Tmobile first announced the massive drop in bandwidth last week, Techdirt commented

"Basically, this is T-Mobile UK announcing to the world that it doesn't have the bandwidth to actually give people what they want, and it hasn't invested in the necessary upgrades to offer a reasonable service. Or, a simpler way of explaining it, is that this is T-Mobile UK telling users in the UK who actually want to use mobile broadband to find another provider."

Tmobile's data cap

Let's connect a couple of recent news stories:

(1) CES was all about tablets. Tablets tablets tablets. 70 of the things. iPad is already selling well, the Samsung Galaxy Tab hasn't been a disaster and now everyone else wants to sell us one of these things too

(2) Tmobile has cut back its mobile broadband cap to half a gig - a paltry amount if, say, you stream a lot of video or music but adequate for a bit of light phone browsing.

So what? Someone at Tmobile has spotted that their customers are all about to buy new tablets, stick their old phone SIM cards in them and neither pay Tmobile anything for the hardware nor even sign up to a new contract.

It's a defensive play to pretend the world hasn't moved on from the old telco model of selling customers a new handset every year and charging them for voice bandwidth. It's not especially evil, and it might even be smart, at least unless one of the carriers doesn't play and we all just move over there.

Latest apocalypse maps neatly onto English-speaking Internet users

Birds dropping like stones from the sky and fish floating belly-up in their thousands sure looks like the end of days, however many times sensible and seemingly expert people say that it's perfectly normal and happens all the time.

But it's hardly an unfamiliar newsflow phenomenon - dangerous dogs or foxes attacking babies happen to make the news one day and having captured the public imagination we suddenly discover they're everywhere, merely because subsequent commonplace incidents that would ordinarily have warranted a few lines on page two of a local paper momentarily fit a wider narrative and so make the TV news. 

Tablet "strategies"

The main news to come out of CES so far seems to be confusion on the part of manufacturers as to what sort of tablets they should be making. 

Microsoft is still trying to get a tablet to run Windows, which means absurdly over-powered and over-priced near-laptops competing with actual tablets. Asus, meanwhile, has brought out four different machines in one go - big ones, little ones, Windows ones, Android ones, keyboards, no keyboards, their strategy has been widely described as just throwing stuff at the wall to see what sticks. 

A world lit only by cathode rays

It's that time of year when metropolitan media/tech commentators wend our way back from a few days in the provincial towns where we grew up, and on getting back home sit down to write with the incredulous tone of anthropologists about the technology that's still used there and the childlike wonder our parents and our friends from school expressed at our iPads, Kindles and 3G-enabled phones. (Did you know they still have video recorders out there? Some of them still even have landlines! And, bless, you should have seen their faces when I cheated in the pub quiz by changing the entry on Wikipedia using my phone...)

Like any tradition it has its pros and cons. It lets us end the year with a happy bit of technophile self-congratulation at time when there's no substantial news, but it leaves us starting the new year under a vague misapprehension about the level of consumer technology that's being used once you get outside London, New York and San Francisco. Having seen our parents' faltering attempts to use the Internet on clunky desktop PCs and having watched them recording soap operas on antique VCRs to watch on tiny pre-HD TVs we return home from xmas with the impression that the digital divide is alive and well (it isn't) and that out in the sticks technology has stood still for another year (it hasn't - it just moves a little bit slower than we're used to).

Should the greatest threat to press freedom in the world really be hosting Press Freedom Day?

Another day, another assault on press freedom by a clueless US government department. Just for the sake of variety though, this isn't an attack on Wikileaks, Wikileaks supporters or the allegedly free US press for reporting on what Wikileaks is doing. This is Homeland Security's seizure of four blog and forum sites that discussed and reported news about BitTorrent. 

The full debacle is at TechDirt, and Mike calls it "downright scary" and "wrong". But Homeland Security summarily seizing domains on grounds that they were infringing the bogus copyright laws made up by the MPAA is one thing; seizing those sites when in fact all they were doing was linking to news stories and opinions about use of the BitTorrent technology is a(nother) direct assault on the freedom of the press. Homeland Security needs to issue a statement, now, admitting that it made a mistake, promising to hand back those websites immediately and most importantly stating for the record that writing journalism about BitTorrent does not constitute a criminal infringement and that journalists remain free to comment on the use of technology, even on the use of technology that may itself be legally dubious in some jurisdictions.