A New Kind of Tech

The tech landscape one of my favorites is taking shape all around us and we see the new shoots that grow and some that set in deep roots and will not be movable easily. The 1980s and the 1990s were the dominance of one company – Microsoft – they had the desktop, they had the browser, they had the productivity suite, they had the computing world in their death grip and no one liked it. They also made buggy software and a part of the whole problem was that they did. It was not that the software was written bad but the company in its attempts at making everything too user friendly and changeable and configurable made a hash of the whole thing with security bugs and the way the applications handled themselves in a hardware environment that was never always the same. Soon they had legions of people who hated them and personally my hate Microsoft moment came sometime in late 1997 when I was working on this critical sales proposal on MS Word and the system crashed and I had not saved anything yet and there it was – a whole day’s work gone in a moment! I hated them and over the years the systems have matured that these are not so much of a trouble at most of the times. But Microsoft ruled and would have if the unrelenting bosses like Bill Gates had kept at it instead of moving to high end philanthropy. They missed the internet first and before long the internet had worked to make a lot of their wares ineffective and unnecessary. The internet kind of stuck it to them for their having missed it and never having understood what the medium could do.

The years after that were the years of the internet and the new kids on the bock were the people that offered services and functionality on the web through the browser. The king was search and the guys that got it right had a great price that they could take away and it would be dominance story once again. At first there were the early starters like Yahoo and Altavista – but soon enough and like all technology does – better and faster prevailed and the new king in town was Google – soon to be a noun and a verb in  English dictionary and till then just a nifty little search engine that had a whole new relevance based way of figuring out the answer. In 2000 Google did not exist except as a plan in a college kids head, in 2010 it is nice to know that the company has taken the lead, been a great investment and also sort of started on its inevitable path to decline. It is like a whole new take on the compressed growth patterns that children today see. These were new kind of companies run by people who were brilliant and who knew how things worked pretty well. A good proof that the right people run Google is to be had when you realize that the company though incorporated in America effectively pays a tax of 2. 4 % in a country where the tax rate is actually 35% and more! Google kind of owned the world and everything in it and even before that could be done – there came that upstart Harvard drop out who made the world more social! Just when you thought that search was everything it turned out that social was bigger! Social had been around for  long time and then Mark Zuckerberg came along and before you knew it this was a site coded in the simplest of PHP that was making the largest of all differences.

As a matter of fact Facebook is indeed so big as a cultural phenomenon and a business that Goldman Sachs – a company that restricts its employers from using Facebook recently invested a cool 500 million US in the company moving its notional valuation to $50 billion US. That is a valuation for a company that is currently not listed and also means a price earning ratio of 250 if the latest update of their turnover at $700 million in 2010 and income of $200 million is to be taken. While that may sound impossible it must also be mentioned that the PE Ratio of salesforce.com – the SaaS CRM pioneer is 250!!

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About Soumya
A technology enthusiast, forever enamored by all that it hath wrought and of course here is an attempt at making sense of it all and perhaps simplifying it!

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