View from the Inside

Influential bloggers calls for downturn in Silicon Valley

Web 2.0, as the recent surge in Internet ventures has been termed, is re-igniting the innovation engines in Silicon Valley. But not everyone is happy with that.

Utilizing a new, flexible but powerful compilation of software programs, termed AJAX, new companies began popping up a few years ago. Michael Arrington, created a blog in 2005 called TechCrunch.com, to cover the then burgeoning trend. With insider insights and interesting companies to write about, TechCrunch became a massive hit and can claim close to 500,000 visitors a day.

On May 22, however, Arrington wrote that he missed the old days, circa 2004, where burgers, beer and backyard parties offered the setting for entrepreneurs to network. No longer is that the case. Easy capital has changed everything, he intones. Put another way, Web 2.0 has jumped the shark. [Money quote: "Times are good, money is flowing, and Silicon Valley sucks.” ]

He suggests Silicon Valley needs a good downturn to set things right again. Strangely, another blog superstar Robert Scoble, followed up with his own similarly-themed post "Why I'm in a malaise ..." [Money quote: "I too look wistfully back at the days when we had almost the entire Social Software industry in one little coffee shop back in 2002 — none of whom were talking about making billions of dollars. "] It's a strange call to arms, to be sure, but the insights they provide offer an insider's look into a boom as ownership is transferred from the innovators to the exploiters. GEO