Tuesday, March 27, 2007

Loser: Industry, profit, good incomes, evolution - Winner: Marx, Lennin, Stalin, Gorbi

As far as I have been able to tell, Web 2.0 technologies are most equipped at creating greater efficiency in marketplaces and removing the ability to make money in an industry.

Farecaster will encourage even steeper competition in a field where players go bankrupt every 5 years. Streaming movies will remove the need for NetFlix, Blockbuster, or the corner video store (and the employees within). Music sharing will destroy big execs, hair bands, and Ferrari dealerships.

All of this is fine by me, I don't work in any of those industries, and I like free music more than most. I worked at Blockbuster when I was 17 and I hated it, so I am glad to see them go down the tubes.

However, when all market inefficiencies are removed, jobs will go with them. As more jobs become virtual, they will travel to the lowest cost locations. Today it is hard to outsource a consultant, but with cheap video streaming, LCD TVs, and people comfortable with the idea of remote commuting, outsourcing a consultant (or any MBA level job) will be very easy too. Then we will all have something to worry about. I have seen many times how Web technologies can make life faster, easier (for some), and remove mark-up, but I have yet to see how many of these can sustainably make money and consistently add value to their shareholders.

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