Jason Preston
Writing

Beware of the bubble

Jason Preston · 1 min read ·

Mary Jo Foley counted the score between Gates and Scoble on calling the Web 2.0 bubble an actual “bubble.” I happen to think she (and Bill) are right: we’re in bubble thought mode.

What’s really interesting to me is that a lot of discussion right now centers on how Microsoft is going to react to and engage with the “Web 2.0 environment,” in other words: when and how will MS offer its own YouTube, PodShow, and WTF is up with Zune?

This is a weird question, because internet revenue still hasn’t really been figured out. We’ve gotten this far:

  1. Users aren’t going to pay for content, and they bitch endlessly about paying for the connection in the first place

  2. Ads work, but only in places where they can be targeted properly (read: search)

With online services, buzz does not necessarily equal buck. You can do things right, and you can do things wrong. I don’t think Microsoft should have a video-sharing service. The economics of online video, and Mark Cuban agrees with me, are crap, not to mention it’s an increasingly crowded space.

I think MS is going to wait for “the bubble” to settle down a bit and find workable, profitable, models. That’s what they’ll make their move.