Justin is fundamentally missing what people are saying the bubble is. From my perspective, no one is arguing that high tech and programming <i>won't</i> be more and more important in the future.<p>"Anyone who tells you that you shouldn’t be in tech, or that the current market situation will create an oversupply of people in tech, is doing you a massive disservice."<p>Who is saying this? I don't think <i>anyone</i> is trying to dissuade people from getting high tech skills.<p>I believe that the bubble consists of the massive amount of startups that do not actually provide a valuable service. Do we really need another social network or sharing site or "X for Y"? No, we don't, but it seems like 90% of the startups getting funded by incubators are just rehashes of that.<p>I believe that point is explained very well here: <a href="http://scripting.com/stories/2012/04/19/itsDefinitelyABubble.html" rel="nofollow">http://scripting.com/stories/2012/04/19/itsDefinitelyABubble...</a><p>The key points are here:<p>========<p>2. We're bundling young people into things called startups, and selling them to investors for ever-increasing amounts of money.<p>3. In an effort to bring more suckers in, they just passed a law that makes it legal to pimp these startups to people who don't know anything. You will be able to take their investment by swiping a credit card. Probably using a $4 billion valuation Square dongle for an iPhone.<p>4. They have started incubators in every major city on the planet. Unfortunately it hasn't been stylish to learn how to program for a number of years, so there aren't that many programmers available to hire. And it takes years to get really good at this stuff.<p>5. Even if they could find enough programmers, there aren't that many businesses to start to satisfy the demand for investment vehicles. A lot like the situation with mortgages in the last bubble. So the VCs and angels and no doubt some very shady folks are putting together deals with people who can't program with no actual idea for the business. Don't look to Y-Combinator, they're the quality act here. But there are incubators in every city from Santiago to Beirut.<p>========<p>The most important sentence there is "A lot like the situation with mortgages in the last bubble. So the VCs and angels and no doubt some very shady folks are putting together deals with people who can't program with no actual idea for the business."<p>And that is the bubble. Startups being founded with people who can't program with no actual idea for the business. Just like the last mortgage bubble.<p>And to be fair to Justin, I think twitch.tv is great. It is novel, has a clear path to monetization, and provides a service that people actually want. We need more venues for professional gaming and twitch.tv is a great step in that direction.
It's funny to look back at news articles when past bubbles were forming and compare it to the articles that are popping up now about startups. It's hard not to see similarities. Take this 2005 NYT times article, titled "Trading Places: Real Estate Instead of Dot-Coms", for instance (<a href="http://www.nytimes.com/2005/03/25/business/25boom.html" rel="nofollow">http://www.nytimes.com/2005/03/25/business/25boom.html</a>):<p>'Premonitions of a bubble on the verge of popping do not ruffle those who are bullish on real estate. In Miami, Ron Shuffield, president of Esslinger-Wooten-Maxwell Realtors, predicted that a limited supply of land coupled with demand from baby boomers and foreigners would prolong the boom indefinitely. "South Florida," he said, "is working off of a totally new economic model than any of us have ever experienced in the past."'<p>It seems like a lot of the same kinds of thinking in Justin's article, "we might be in a bubble, but for you it doesn’t matter. The reality of the world is that software, specifically Internet enabled software, is becoming a part of every business. Marc Andreessen said “software is eating the world,” and by that he meant that as time goes on, every industry is becoming a software industry...You want to be in the tech game, because in time it will be the only game in town."
When I read things like this, I have to wonder if the people saying it are really naive or sheltered enough to believe it:<p>"You want to be in the tech game, because in time it will be the only game in town."<p>Well, no...because tech won't be big enough to employ more than a relatively small percentage of the population. And it won't matter that companies want to pay tech workers to help automate people out of jobs. Because once everyone is unemployed, no amount of tech will keep a company in business if nobody is making enough to buy its products.<p>Without a doubt, things are going to change. Just like they always have. Some industries will gain, and some will lost. Some people will find their skills in high demand, and some will find their skills obsolete. We won't, however, end up in world where you either work in tech or you're unemployed.
Another point to add to Justin's:<p>Few skillsets grant you more of an ability to be self-reliant than the ability to understand and write software -- even if there's no job description written for what you do, or no company who will hire you. In almost any field of entrepreneurship, if you have tech savvy which your competitors don't, you have an inherent advantage against them and an ability to crack open the market.<p>Are you a DJ or party promoter who understands SEO/SEM and social media? You've got a leg up. Are you the only person in your area who understands both fashion apparel supply chains and software? You could be providing immense value.
> Most people aren’t self aware enough to realize what is happening that is making their jobs disappear: a strong trend in software automation to make business processes more efficient.<p>This reminds me of a really helpful salesperson at the Apple store that was really excited/proud to tell me that you can now walk in and purchase an item without ever talking to a salesperson...
This article conflates two issues: the secular trend that is "software eating the world" and the local trend which is a valuation spike.<p>»<i>The truth is that the technology sector as a whole over any length of time is a positive-sum game</i><p>Actually, no - a bubble means people aren't investing on fundamentals but on momentum; the expected value of the investment is negative. If we were in a bubble (as in bubbles past) we wouldn't be in a positive sum game. Saying that it would be a net positive game over "any period of time" is economically and empirically ridiculous.<p>I happen to believe that we are not in a bubble. But if we were it would matter - it would mean that when the bubble pops opportunities in the field would decrease in frequency and magnitude. Since career scars early on have more persistent effects than displacements later in life it follows that an aspiring tech star cannot ignore the market realities of what they're going into.<p>We are mortal, we can't just ride the secular trend. The local time scale matters, too.
> News sites with a better grasp of how the Internet works, like HuffPo or Mashable, are worth hundreds of millions.<p>I've been wondering - when all the old media inevitably die off, where are these aggregators going to find their content?
The first thing you have to do to understand why bubbles happen is to stop believing everyone in it is being 100% rational.<p>The reality is that for most investors the vague notion that they might be missing a great opportunity far outweights any well documented evidence that they are walking into a sinkhole.<p>Many investors from the dotcom bubble simply left the market and new ones took their places. If there's money to be made some people will always be there, it doesn't gets more complex than that.<p>So basically you shouldn't stay out of tech right now just like you shouldn't stay out of tech in 1998. You should've done that in 2001 when everything started to collapse. Funny that Justin mentions Amazon because that company took a nosedive back then.<p>Question is, how long we have until the next 2001?<p>When that happens many people, including "negationists" and wantrepreneurs will GTFO from tech as fast as they can rip the copper wire from their office walls.
Theres just so little value in the stuff being produced. Its absurd.<p>Where are the people who are designing actual tangible items?<p>Why is so much of this stuff only fluff and entertainment?
On the other hand, there might come a time where software becomes so important and pervasive that it won't make sense anymore to call yourself a software engineer or a software company. I'm guessing there was once a time where the next big thing was to become a mathematician. However, mathematics has grown so central to so many fields that very few people nowadays call themselves mathematicians or dream of building mathematics companies. I wonder if programming will not simply become an increasingly important tool within other disciplines or if everyone is really just going to start studying CS/software engineering. This is probably more an argument on semantics than a rebuttal.
I thought I would add some support for the argument of choosing the tech sector as a career. If you look at the statistics it seems that 5 out of the top 10 jobs of 2012 according to this survey is in the tech sector with software development being number 2. And the estimations for the coming years are pretty staggering. Tech is probably not a bad field to be in, lucky me, I think.
<a href="http://money.usnews.com/careers/best-jobs/rankings/the-25-best-jobs" rel="nofollow">http://money.usnews.com/careers/best-jobs/rankings/the-25-be...</a>
Really insightful article, especially for someone like me: a EE/CE student wondering about whether or not the current trends in tech jobs will continue into the future. I know I can get a job when I graduate in either hardware or software design, but I've been uncertain as to how quickly the industry will saturate and whether or not jobs will still be around (or pay well enough to be satisfied with the additional educational investment) in 5-10 years. Glad to see some insightful, well-informed confidence in the future of the industry.
Software is indeed eating the world. What's going to devour it?<p>HARDWARE + SOFTWARE.<p>think nest, tesla (yes, it's a huge software play), and the like.
proof positive we're in a bubble: <a href="http://wag.com/" rel="nofollow">http://wag.com/</a>. <a href="http://pets.com/" rel="nofollow">http://pets.com/</a> is back!