Ben Horowitz is one of the smartest tech bloggers and investors around. He posted today about his views on whether we are currently experiencing a second Internet bubble or not. For the record, he believes we are not and provides very sharp points backed with financials. The main ones are that building software today is much much cheaper than in the past and that there is now a 2bn market to distribute software over the internet.
He then goes on to explain his understanding of the current technological shift:
One thing he does not mention is that the shift to cloud/mobile will soon grow the software consumer market by another 2bn or so by adding all those BOP mobile users as they upgrade to smartphones. This will bring huge developmental benefits as those “new companies that solve important problems” increasingly focus on the BOP.
Back in the mainframe paradigm that Ben discusses, the beneficiaries of technological innovation were the government, the military and the large corporations and universities. As the industry moved to client/server, rich-world consumers started reaping the benefits of venture investment and start-up innovation. Today we are at a point where most activity focuses on them and corporations play catch-up with their employees.
It then follows that the shift to cloud/mobile will re-focus innovation towards BOP consumers. Not only they are legion and will be connected to the digital marketplaces. They’ll also produce the innovations themselves, given the astounding drop in capital needs to build software and the imperative to understand the end-user.
Now, that’d be gargantuan for sure. We can’t wait to see it happen.