Innovation is NOT going down the drain, thank you very much

This BusinessWeek article talks about the business of ads in the tech industry, and how it is, on the face of it, rather sad that so many smart people – mathematicians, economists – are being employed by the likes of Facebook to basically find out ways to sell ads. Jeff Hammerbacher was hired by Zuckerberg as the lead research scientist early on, and after a couple of years, had enough:

He figured that much of the groundbreaking computer science had been done. Something else gnawed at him. Hammerbacher looked around Silicon Valley at companies like his own, Google (GOOG), and Twitter, and saw his peers wasting their talents. “The best minds of my generation are thinking about how to make people click ads,” he says. “That sucks.”

Another concern:

“My fear is that Silicon Valley has become more like Hollywood,” says Glenn Kelman, chief executive officer of online real estate brokerage Redfin, who has been a software executive for 20 years. “An entertainment-oriented, hit-driven business that doesn’t fundamentally increase American competitiveness.”

I’ll admit I have occasionally thought of the first point – that finding ways to sell ads isn’t the most productive use of one’s time, but the truth is it’s the only way services like Google can remain free.

Ultimately, ad-tech companies are giving consumers what they desire and, in many cases, providing valuable services. Google delivers free access to much of the world’s information along with free maps, office software, and smartphone software. It also takes profits from ads and directs them toward tough engineering projects like building cars that can drive themselves and sending robots to the moon. The Era of Ads also gives the Wants something they yearn for: a ticket out of Nerdsville. “It lets people that are left- brain leaning expand their career opportunities,” says Doug Mack, CEO of One Kings Lane, a daily deal site that specializes in designer goods. “People that might have been in engineering can go into marketing, business development, and even sales. They can get on the leadership track.” And while the Wants plumb the depths of the consumer mind and advance their own careers, investors are getting something too, at least on paper: almost unimaginable valuations. Just since the fourth quarter, Zynga has risen 81 percent in value, to a cool $8 billion, according to Nyppex.

To get the benefits, you have to do the time and that’s the harsh truth. However, I don’t agree at all with the overall sentiment in the article – that innovation is dying as a result of this particular so-called tech bubble. One look at the startups that come out of programmes like Y-Combinator, Tech Stars and SS3, a much smaller programme to support 3 entrepreneurs in the UK that was started just this week, is enough to convince me that all is not lost.

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