This was the lead story in the business section of SMH on Sat...

http://www.smh.com.au/business/comin...520-1ewst.html

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strange that Fairfax media who wrote the story would write about a technology bubble when their whole investor presentation and asx market report says the opposite!

havent noticed them dumping any of their 30,000 domain names and websites they are developing via www.omg.com.au

Talk of a bubble represents two things time to sell or time to buy. Make your own choice people. Being fearful achieves nothing.

" Analysts have correctly forecasted 1 of the last 200 bubbles" ... Brian Tracy

Google image the term "Market trend chart"

I think this sums up a lot of the tech bubble:
At the end of the day the internet doesn't leave lots of room for runners up.

In most markets there are only a couple of key players who win the majority of the market share and the rest aren't profitably enough to continue to compete.

This, in most cases, is due to the low switching costs between sites and the fast speed at which valuable sites become noticed (ie they "go viral").

So when people are "investing" in unproven online businesses what they are really doing is "speculating" that their company might the ONE that dominates the market, but in the majority of cases their company is far more likely to go bankrupt with the REST.

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And a couple of nice stories in Smart Company today:

http://www.smartcompany.com.au/inter...ew-bassat.html

http://www.smartcompany.com.au/inter...ler-sites.html

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I don't really feel there is a general tech bubble - possibly in the coupon/deals area but elswhere I just can't help but see value - against other media anyway.

Just from an advertising POV I think we still have billions and billions of dollars currently being spent each year elsewhere that will come online sooner or later. All that 'old media' money will surely push up more sustained activity online

That's probably true but if 95% fail and 5% each return 100 x your money, then it's worth playing the game isn't it? kind of... you know the point I'm making.

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A few points,

-The story writers job isn't to give the viewpoint of the CEO of Fairfax. In this case it doesn't look like it was written by an employee either,

"Kate Askew is the author of Dot.Bomb Australia: How we wrangled, conned and argie-bargied our way into the new digital universe."

-Secondly the bubble talk in't unreasonable, eg linked in trading at levels hundreds of times its profit. Things definitely seem frothy in some areas.

-Thirdly - Whatever Fairfax may say to investors isn't necessarily the words of the wise. As a company they've be going down the tube for years. They have lost all the major markets they once dominated, realestate advertising (to realestate.com.au), employment (to seek), and lastly news itself with the demise of newspapers.

I think bubble is a strong word, but there's no doubt it's getting very heated. As snoopy pointed out, Linkedin is trading at a massive multiple right now. They will need to enjoy huge profit growth to justify the price.

This is the second or third time you've spoken about dumping domains. This bubble has nothing to do with domain names, it's about online businesses. If you had built up a portfolio of domains and paid reasonable prices for them, why would you suddenly dump them?

Just because some of us see the market as getting overheated doesn't mean we're going to sell good assets. The only exception would be if people started making offers too good to refuse, and of course when that starts happening it's an even surer sign of a bubble that is getting ready to burst.

The key word you used there was "sustained". Now unless you are talking about Google, Apple, Microsoft, Amazon, etc you're not talking about companies that have a track record that can justify the term "sustained" profitability.

Most online investments (even buying domain names) is "speculative" by nature.

So when big money starts chasing unproven models - you have a speculative bubble by definition.

And here lies the question - can you still get an ROI even if many of your investments fail. The majority of people never diversify enough to ensure this in which case the answer is "no" it's not worth playing the game.

The next obvious question, is a higher risk reward investment strategy more profitable that a more reserved strategy. Historically, when it comes to buying companies - tried and true companies make for better investments.

That said, it would appear that the average punter derives at lot of utility from the excitement of gamble or the chance to go from zero to hero, thus why we all love riding on a speculative bubble...



So it might be worth the investment if you are looking to add a bit of spice to your life.

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if its a bubble count us in! The internets only just starting in Australia guys who knows where it will be in 7 years ( there was no facebook 7 years ago !)

http://www.catchoftheday.com.au/news.php?article=541

Jackpot: how brothers will slice up Packer's millions

Read more: http://www.smh.com.au/technology/biz...#ixzz1NAyRkd1C