Some of the Tech Magic Is Gone
At this time in 2021, technology was eating the world and the stock markets.
Now… ah, not so much.
The Nasdaq index of nearly 100 tech stocks is down 14 percent since late December, much more than a drop in a collection of U.S. stocks that aren’t technically heavy. Tech superstars including Facebook, Alibaba and Tesla have slipped to the bottom of the ranks of the world’s most valuable companies.
More governments are trying to control how tech companies operate. Some tech investors and observers are starting to ask whether the decade-long boom in start-ups is losing steam, and indeed this time. The cryptocurrency should be having its moment, but instead the price is falling. Initial public offerings mostly take place at intervals.
At several points over the past decade, many people (including me) have asked whether the tech bubble is over, and they have been mostly wrong. I am not going to predict the future, but rather try to assess the moment for technology. Some strange things are happening.
Right now, little faith in the ever-increasing ups and downs of technology has vanished. It’s not a bursting bubble at all. It’s like a (perhaps temporary) lack of faith in the great magic of technology.
So what is going on?
Look, the world is mobilizing to stop the invasion of Ukraine, the coronavirus pandemic continues into its third year and governments are trying to climb up on consumer prices. Those forces and other troubling events are making investors consider more carefully where they put their money, and in some cases tech companies, start-ups, or bitcoin no longer feel like good bets.
Earlier technical freakouts, including the early months of the pandemic, proved to be temporary and could be. but then, does something perception Different this time. Perhaps.
Every other day, some tech company whispers that its sales won’t grow to infinity, and its stock price plunges into a pit. Zoom Video Communications, one of the tech companies that had earlier proved essential with the rising share price in the pandemic, is now back at its February 2020 stock price.
That is a strong symbol. People with the money are saying no to buying the stock right now on anticipation of blockbuster sales years in the future. It’s also a root cause for the recent loss of trust in public companies, including stock trading app Robinhood, upstart electric vehicle company Rivian and Chinese on-demand ride start-up Didi.
Dan Ives, a technical investment analyst at Wedbush Securities, told me that he believes the world’s digital transformation is just beginning and that technology companies will continue to grow bigger and stronger.
But he said investors are reconsidering the potential of some young companies that are growing at the rate they were a year or two ago. In some corners, Ives said, “the foam has clearly come out of the tech market.”
Declining optimism is affecting young tech companies that are just getting started. According to a recent financial presentation from start-up investment firm Redpoint Ventures, investors are paying for start-ups in the early stages of growth, which peaked in the second half of 2021.
Dan Primack, a journalist with Axios, said two months ago that the “go-go era is history” for tech start-ups and other types of young companies.
Primac knows that similar predictions have repeatedly fallen off base, but he cited evidence that investors were no longer throwing cash at anyone who called the word “innovation.” Being reckless or financially irrational has long paid off for investors in start-ups, and Primack says the wealth is no longer as great as it used to be.
Again, all of this may prove to be a blip, and technology may continue to add to both wealth and importance. I also know that not many of you are in tears over the pit-priced stock prices for Facebook and Netflix. Neutral. Blind belief in technology is not good for us, but belief in technology has also been beneficial.
That optimism in technology has given companies the cash and freedom to bring us zippy laptops, Doritos delivered in 15 minutes, and more options for working away from the office. If and when the tech party gets less grand, the changes we’ve taken for granted may disappear, which could potentially be both disruptive and healthy. we will see.
tip of the week
say no to photo locations
Brian X ChenoConsumer technology columnist for The New York Times recommends a personal protection move for our smartphone cameras.
When you use your iPhone or Android camera, Apple and Google ask for your permission to share your location with the camera software. This is for “geotagging” or pinpointing the exact location where you took the photo.
This information is used to automatically create photo albums based on your whereabouts, such as your trip to Spain. This can be useful, but it’s important to ask yourself whether marking the location on every photo you take is worth the privacy risk.
Imagine you met someone on a dating app and you send that person a selfie from your favorite coffee shop. If you happen to be there every morning, you might not give the exact location of a stranger you visit regularly.
My general advice is to keep the location tagging feature off by default and only turn it on for select occasions, like when you’re traveling for a vacation and want to remember when you were snapping a picture. where were you
To check if you have enabled geotagging on the iPhone, open the Settings app, tap Privacy, choose a location, and tap Camera. Click “Never” to disable geotagging.
On Android, open the Camera app, tap Settings (or the image that looks like a gear) and turn off location tagging.
Before we leave …
Digital assistance for Ukraine: A city transit app in Kyiv was redeployed within 24 hours to warn residents of impending Russian attacks and help them find shelter and essential supplies, The Guardian reports.
And from The Washington Post: How the West is breaking through Russia’s propaganda wall, including technology to evade Russia’s Internet censorship and text messages to strangers in Russia that contradict the Kremlin’s official line on the war, (A subscription may be required.)
How Google learned to lobby: A decade ago, an insurrection from laymen and small web companies helped scuttle Congress’ bills on online copyrights. Protocol writes that Google learned from that episode how to marshal the power of angry Internet users, and needed to be an insider in Washington. The company is now using those strategies to fight congressional no-confidence motions that would affect it.
It is the first international blockbuster of China’s video game industry. And it is, according to my colleagues Ben Dooley and Paul Mozur, an almost perfect replica of existing role-playing games from Japan.
This little lemur. look at, It’s hugging a stuffed toy while it’s being weighed. (Thanks to an On Tech reader, Tim Hunter in Durham, NC, for suggesting this.)
One correction: Wednesday’s newspaper Incorrectly described Tasty’s setup with Instacart. Viewers will have the option to purchase content from Instacart’s app and not from TikTok.
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