Too Early to Call Time on Web 2.0

It's fascinating to see the mainstream business press calling time on "Web 2.0". Presupposing that the Web 2.0 tag constitutes a definitive cohort of businesses who must be earning substantial revenues today, if they are ever to be successful...

This as just another consequence of the credit crunch, rather than evidence that it's suddenly crazy to start a web business dedicated to enabling users to take control of their retail, entertainment, financial and other personal affairs. It's a sign that the institutional herd is headed for safe havens and wants a slow summer at the beach, free of write-offs and any doubt that it might be missing key opportunities through its inability to invest in the current tidal wave of innovation.

But the curtain is barely up on Web 2.0, and at this rate the FT's core readership will miss the whole show.

There is plenty of non-institutional money to be had - and you don't need much of it - to help start a Web 2.0 business. The angel world is also still awash with pre-Crunch bonus money and the likes of ex-Googlers cashing in their options to do help Facebook or do their own thang. Seedcamp is happening again, and (the ironically named) Techcrunch is alive with plenty of news, even from Europe. Remember, too, that venture funding is not required to build any of the infrastructure necessary for Web 2.0 businesses to flourish. The big corporates in the internet game have taken on that job, and are still investing heavily to create the bandwidth and computing capacity on which low cost, web development start-ups like Ooyala are feeding greedily.

Seems to me that September is going to see a whole new tidal wave of innovative business launches - so it's gonna be a pretty intense summer for some!

Ironically, Search is Now a Shield Against Competition and Innovation

Stories used to abound of small companies finding new markets via search. The Birmingham based chocolate shop selling to Bostonians is one that springs to mind.

But Google's decision to follow Yahoo in allowing rivals to bid on brand names will limit competition and innovation from start-ups and other cash-constrained companies.

Unless brand owners win the daily and hourly battle to stay on top of the key word auctions, they risk leaking customers to rivals. That process suits anyone earning super-normal profits in any given market segment, particularly big brand owners and their agents and introducers of business. Any of these players could not only afford to stay at the top of the bidders' list for their own brand names, but could also choke off competition by winning the auction for their rivals' key words and re-direct the traffic to their own sites. To stay on the whiter side of what is legally a grey area, all the winning bidder on a rival's trade mark really ought to avoid is their rival's trade marks appearing in the search result that in fact promotes the winning bidder's own products or services.

Competition authorities and legal advisers should pay close attention to who bids on the search terms related to market segments where dominance is of particular concern. But it seems unlikely that the authorities, challenger brands or the search engines themselves will have the resources to focus on this battleground, or respond to every complaint. Indeed, the cost of responding to requests to prevent bidding on brand names is possibly the reason that the search engines have dropped their previous restrictions in this area.

Mens Sana in Corpore Sano

Now that I'm "rising 43" (as my children's school might put it) any motivation to keep in shape is critical.

So I'm competing to raise money for Prostate UK again this year in a series of "rowathlons" organised by DB Max.

Rowathlons are triathlons with the swimming leg replaced by a stint on an indoor rower. I find them satisfying to train for because of the variety in the three elements and the need to build gradually towards an event. So I can train all year to avoid the beer belly and still not get stuck in a rut. Oh, and I can also sit down to watch inane daytime television during the rowing sessions, instead of staring at the black line on the bottom of a pool.

Of course, the events themselves are where the rubber hits the road, and you really get to see the results of all the training (and any missed sessions!).

These are niche events, with 100 to 150 competitors - not some giant crowd - and tend to be run at race circuits or parks to avoid the hassle of traffic (and hills!).

So far, there are three events scheduled for this season:

• Trybike Mallory Park Rowing Triathlon - May 5th - 2.5k row, 20k cycle, 5k run
  
• Castle Combe Rowing Triathlon - August 10th - 3k, 20k, 3k
• Reading (Green Park) Rowing Triathlon - August 30th - 2.5k, 7k, 2.8k

Why not give one of them a go?

FSA Needs Help to Shut Northern Wreck's Stable Door

Hopes that the FSA's internal audit report into the (mis-)handling of Northern Wreck would quietly close the stable door have been dashed.

Not only do the recommendations in the report imply major shortcomings in the way "high impact" firms are supervised, but the fact that the revelations have come 8 years and so many scandals into the agency's existence also suggest that the FSA is incapable of closing the stable door on its own.

But the FSA is not so much to blame, as our expectations.

It does seem unrealistic to expect the FSA (any more than every bank it supervises) to hire enough people of sufficient calibre and to keep them sufficiently trained and informed to detect every significant hole in firms' evolving business plans/models that may be exposed by the latest financial wheeze. Even if the FSA could solve that staffing and data challenge, the chances of the FSA actually persuading bank management to accept that a particular hole exists and to plug it quickly enough seems very unlikely to work every time. After all, participating in financial markets inherently involves the assumption of risk, not completely eliminating it.

I guess there's no harm in the FSA continually striving to improve the likelihood of meeting these expectations - or aspirations - except for the ever-increasing budget that will be required.

One thought is for the FSA to rely more on third party firms to do the specialist business and economic analysis, leaving the FSA to focus more tightly on commissioning, reviewing and reacting to their reports and managing the regulatory relationship with firms. That would allow for clearer segregation of the detectives from the prosecutors. The profit motive might enhance the economic efficiency with which the analysis is done, and also enable deeper expertise to be built over a longer period than the FSA's career ladder might allow.

I hear howls about more money being spent by government on consultants, and that too needs a good overhaul for sure, but it's no argument for depriving the government of private help.

Whatever happens, the private and public elements of the financial services industry will have to work better together if more Wrecks are to be avoided.

Bohemian Rhapsody, Anyone?

You know that we 'live in interesting times' when the UK government is budgeting on most of us drinking, smoking and driving fast cars so that it can find the extra money to save children and OAPs from poverty.

Next we'll be asked to take on giant mortgages from Northern Rock so that when we default the government can take our homes for public housing.

And after that? When all the money is gone on booze, smokes, fuel duties and high octane interest rates?

I fancy just drifting around...[begins to sing to the tune of Bohemian Rhapsody...]

"Financial landslide
No escape from reality
Open your eyes
And look at your buys and see.
I'm now a poor boy
High-yielding casualty
Because I bought it high, watched it blow
Rating high, value low
Any way the Fed goes
Doesn't really matter to me, to me

Mama - just killed my fund
Quoted CDO's instead
Pulled the trigger, now it's dead
Mama - I had just begun
These CDO's have blown it all away
Mama - oooh
I still wanna buy
I sometimes wish I'd never left Goldman at all.

I see a little silhouette of a Fed
Bernanke! Bernanke! Can you save the whole market?
Monolines and munis - very very frightening me!
Super senior, super senior
Super senior CDO - magnifico
I'm long of subprime, nobody loves me
He's long of subprime CDO fantasy
Spare the margin call you monstrous PB!
Easy come easy go, will you let me go?
Peloton! No - we will not let you go - let him go
Peloton! We will not let you go - let him go
Peloton! We will not let you go - let me go
Will not let you go - let me go (never)
Never let you go - let me go
Never let me go - ooo
No, no, no, no, no, no, no, -
Oh mama mia, mama mia, mama mia let me go
S&P had the devil put aside for me
For me, for me, for me

[guitar bridge]

So you think you can fund me and spit in my eye?
And then margin call me and leave me to die
Oh PB - can't do this to me PB
Just gotta get out - just gotta get right outta here
[guitar solo]
Ooh yeah, ooh yeah
No price really matters
No liquidity
Nothing really matters - no price really matters to me
[instrumental ending]
Any way the Fed goes...

Anon. (circulating on the emails today)