Pinterest and the Technology Bubble

Robert Scoble thinks Pinterest is “the hotness“; Wayne Radinsky says NBC Nightly News thinks Pinterest could be worth more than $7 billion and laughs at the idea.

I laugh at this, too.

Pinterest is nothing more than Tumblr with the ability to have subcategories/subtumblrs.

That’s all there is to Pinterest. The only reason it’s blowing up right now is because it’s relatively new. The amount of google search hits for “tumblr” are going to exceed “blog”, yet Tumblr isn’t worth $7 billion, nor should it be, despite being around a lot longer than Pinterest.

This is the makings of a tech speculation bubble. People are looking at these ventures and practically guessing what kind of money can be made with their technology. There’s not a serious revenue model in sight.

Wall Street, the mortgage industry and the banks also thought that the value of homes would always continue to rise. Look what happened when that dream bubble popped.

The truth is, as Ashlee Vance of Bloomberg wrote: “Tech bubbles happen, but we usually gain from the innovation left behind. This one—driven by social networking—could leave us empty-handed.”

The Kernel: “The PayPal mafia are the new Baldwin brothers, says Milo Yiannopoulos, who wonders if Silicon Valley has become a hit-driven entertainment business that’s ultimately unproductive for the American economy.”

The nominal value ($7 billion) of something does not mean its real value is anything to brag about. The value of land in the US rose, as did the value of homes, but the real value didn’t rise with the prices and eventually had to collapse. The same will be said of the tech bubble once the speculators go home with heavy pockets.

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