Social,Media,epic,tulipomania, marketing Social Media – An epic tulipomania in the making!

Automation technologies represent a fundamental aspect of any modern industry. The major types of industrial automation solutions, such as DCS, PLC, SCADA, and MES, are used on a large-scale in process and discrete industries.DCS technologie Awhile ago, I got an email from one of the "gurus" I follow and it shocked me. The gist of it was this person wanted to trade services for a household item.To say it floored me would be an understatement.What was worse was a few days later t

Facebook is still far too much likeAOL, a walled garden, it will ultimately be replaced by openstandards.“Yes”, to all those who ask,Facebook is making something!... a site that increasingly luresmillions of naïve people into giving away their very valuable personal information for free. This information is then mined,combined, packaged and otherwise exploited in countless ways and willbe sold to companies for targeted marketing.So who needs to manufacture when we canbuild ethereal connections and 'value' them at absurdly high prices,as that old computer saying goes “Garbage in, garbage out”. Addin that other well known saying “There's a sucker born everyminute”, simply stir well and wait for the bubble to burst.Can anybody explain how Facebook isworth 50B? Facebook has a revenue of approximately 2B, they have $4of revenue from each person that is on Facebook a year, with a fickleuser base.It is quite outrageous, Facebook isbeing valued at 25-28 x revenue (Google is 8 x revenue) and Apple is4 x revenue) and almost 120 x earnings (Apple is 20 x) This is quiteinsane. It means that investors think Facebook will increaserevenues by 400% and profits by almost 600% at a time when theirgrowth is starting to slow down...as I said earlier, a bubble!Sure it is admitted that they haven'tbeen able to monetize Facebook yet, get ready for ads everywhere,commercial clutter anyone? You ain’t seen nothing yet! It is amarket overblown and still operating on the greater fool theory. This is the biggest pyramid scheme ever – a 50B dollar company thatmakes its' money from what exactly? Oh yes I remember, Farm Games!In recent years, consumers havebecome used to feasting on online freebies of all sorts: newshare quotes, music, e-mail and even speedy internet access.These days, however, dotcoms are not making news with yet morefree offerings, but with lay-offs—and with announcements thatthey are to start charging for their services.” These wordsappeared in The Economist in April 2001, but they’re just asapplicable today. During the dotcom boom, the idea got aboutthat there could be such a thing as a free lunch, or at leastfree internet services. Firms sprang up to offer content andservices online, in the hope that they would eventually be ableto “monetise” the resulting millions of “eyeballs” byselling advertising. Things did not work out that way, though,and the result was the dotcom crash. Companies tried otherbusiness models, such as charging customers for access, but veryfew succeeded in getting people to pay up.Then it happened all over again,starting in 2004 with the listing of Google on the stock market,which inflated a new “Web 2.0” bubble. Google’s ability toplace small, targeted text advertisements next tointernet-search results, and on other websites, meant that manyof the business models thought to have been killed by the dotcombust now rose from the grave. It seemed there was indeed moneyto be made from internet advertising, provided you could targetit accurately—a problem that could be conveniently outsourcedto Google. The only reason it had not worked the first timearound, it was generally agreed, was a shortage of broadbandconnections. The pursuit of eyeballs began again, and a seriesof new internet stars emerged: MySpace, YouTube, Facebook andnow Twitter. Each provided a free service in order to attract alarge audience that would then—at some unspecified point inthe future—attract large amounts of advertising revenue. Ithad worked for Google, after all. The free lunch was back.Now reality is reasserting itselfonce more, with familiar results. The number of companies thatcan be sustained by revenues from internet advertising turns outto be much smaller than many people thought, and Silicon Valleyseems to be entering another “nuclear winter”. Internet companies are againlaying people off, scaling back, shutting down, trying to sellthemselves to deep-pocketed industry giants, or talking ofcharging for their content or services. Some Web 2.0 darlings(MySpace, YouTube) managed to find buyers before the bubbleburst, thus passing the problem of finding a profitable businessmodel to someone else (News Corporation and Google,respectively). But quite how Facebook or Twitter will be able tomake enough money to keep the lights on for their millions ofusers remains unclear. Facebook has had several stabs at asolution, most recently with a scheme called Facebook Connect.Twitters founders had planned to forget about revenues until2010, but the site now seems to be preparing for the inclusionof advertising.The bill, sirThe idea that you can give thingsaway online, and hope that advertising revenue will somehowmaterialise later on, undoubtedly appeals to users, who enjoyfree services as a result. There is business logic to it, too.The nature of the internet means that the barrier to entry fornew companies is very low—indeed, thanks to technologicalimprovements, it is even lower in the Web 2.0 era than it was inthe dotcom era. The internet also allows companies to exploitnetwork effects to attract and retain users very quickly andcheaply. So it is not surprising that rival search engines,social networks or video-sharing sites give their services awayin order to attract users, and put the difficult question of howto make money to one side. If you worry too much about a revenuemodel early on, you risk being left behind. Ultimately, though, every businessneeds revenues—and advertising, it transpires, is not going toprovide enough. Free content and services were a beguiling idea.But the lesson of two internet bubbles is that somebodysomewhere is going to have to pick up the tab for lunch.