The proposed flotation of the social media company on the US stock market is the latest chapter in the on-going soap opera of the internet and social media juggernaut that seems to have entranced the entire Western Hemisphere in its grasp. Media reports have valued the company at billions of dollars and potential investors are clamouring to get their names down to purchase shares. Amidst all this hue and cry there seems to be an element of ‘gold fever’ about the whole issue of Facebook and other social media companies. They seem to have not only been given Messiah-like economic status, but they have also been handed plaudits for their role in bringing down tyrannical regimes. While there’s no doubt that social networks played some form of positive role in the events of what became known as ‘The Arab Spring’, it was still the hundreds of thousands of people facing down the authorities of oppression out on the streets that really made the difference when it came to bringing corrupt dictators to their knees. In the excited blaze of the white heat of technology, have we lost our direction a little in putting social media into context, instead of blindly assuming it is the proverbial cure for all ills?
Making actual things. Makes actual money.
There is a strange paradox that while the world, especially the USA and Europe, are suffering the massive hangover of overstretching themselves via the use of ‘cheap money’, investors and the media still seem to fall at the feet of the internet geeks who put billion dollar values on an imaginary balance sheet, backed by almost no tangible assets other than a ‘brand value’ which is easily talked up. While it’s perfectly plausible that at some point Facebook may turn massive profits, those days are certainly not that close. It seems the lessons of the NASDAQ-led internet bubble which burst over a decade ago have been forgotten.
Ironically enough there are good business examples out there of countries and companies that are holding their own despite the woeful world economic picture. You need to look no further than the technology titan Apple for this. Under the tutelage of the late Steve Jobs and thanks to the ingenuity of the numerous designers who work for it, the company makes huge profits and has millions of happy customers. Apple products have achieved a fetishist status amongst many users, not something which can be said of Microsoft products. Some issues have been raised about conditions for workers in Apple’s subcontractor factories, but so far this behemoth had managed to shrug them off.
When it comes to successful countries, look no further than Germany. Much like Apple the strength of the German economy relies on making, selling and exporting products to other countries. It has also got a multi-tiered banking system which ensures businesses can get the liquidity they need to invest in new projects. The workforce is also well educated and well-trained in order to supply the manufacturing sector with talents it requires. This is not to say Germany is not without economic worries, but it certainly seems to be well equipped for ridging out the economic storms that are currently battering the world economy. Perhaps there is a lesson for us all here. Sometimes it’s good to be a doubting Thomas and refuse to believe in things that might not be all they’re cracked up to be.