There is an article entitled “A rusty future for Silicon Valley?” where Judy Estrin, the former Cisco CTO, says that if the valley doesn’t innovate more, it will be doomed just like Flint, Michigan. 

For those of you who don’t know Flint, let’s just say that it was hit so badly by the american car industry spiraling down that you can actually buy a house for 2000$.

Yes, that’s not a typo – 2 grands.

You could probably tear it down and make a profit but that’s not the point.

The point is that in the 1980’s the american car makers started to feel the pressure from foreign makers.They found their saviour – the SUV. The SUV was not an innovation at all but it was nice and served the american market very well. Most importantly, this was something not offered by the foreign car makers (at least back then). Throw in some government help (tax break for large vehicules and relaxed fuel consumption standards) and the auto industry should live a bit longer. 

However, as we all know it, the story changed. SUV’s are now produced by any car maker and fuel consumption eventually caught up. As a result, it sucks to be an american auto maker CEO today. 

• There is no vision/product
• Their market is crashing
• They have no plan

What was the problem? The SUV was not an innovation at all. It was basically a familly oriented truck. What is innovation? Toyota has been working on hybrid cars since 1994 and sold their first model in 1997. That’s more than 10 years ago. Compare this to Ford who released its hybrid SUV in 2004 (7 years ago). I think that even in the car industry, 7 years is too long.

That’s exactly what’s going on in the high tech area. Every quarter, big companies like Dell and IBM tell analysts not to worry – what is not sold in the US will be sold in emerging countries (Brazil, China, Russia, etc.)

That’s not innovation!

There is, however, innovation in the Valley. Apple and Google are quite good at it. Intel knows that shrinking the chips is just like selling SUV (smaller chips don’t sell more). They are putting software control in the hardware and driving revolutionary PC designs.

So next time you work on a product, tell yourself: Am I creating something new or just moving my actual market to another product and not gaining anything in the end?

This is great news and the price is very affordable. It’s cheaper to go there than to go to a noisy cafe where Internet access is often slow.  I wish Patrick a lot of luck with this project. Pass the word around!

K2 doesn’t explain their definition of web 2.0 but I think you can compare this to fashion. “Cool” people tend to wear the latest designs while conservative people rarely move away from the usual blue/black/white/brown palette. How would you feel if you were to visit a lawyer wearing flashy Puma’s and designer jeans? You might feel more comfortable visiting one whose attire is more conservative (although we all know it doesn’t automatically qualify him as competent). How about visiting a lawyer’s website, filled with pastel, oversized fonts, speech bubbles and, of course, a beta label? Doesn’t that sound strange? At least in this century? If I look at most bank sites, they are not cool and they are not meant to be cool anyways (although some could say that an update is well due for most of them).

What about if you sell jeans to kids? Would you want a bland site or a “web 2.0”-ish site with blogs, profiles, widgets for your blog (i.e. This is the jeans that I want – buy it for me) and some viral marketing stuff on it? I’m sure that even a local plumber would benefit from having a blog. By answering free questions, he could quickly become a star in his hometown.

So… It really depends who you are and who your customers are. I think that K2 went a bit too far by using the term “most”. It’s like saying most companies don’t need computers. Maybe they didn’t 10 years ago but most companies use them nowadays… I suspect same will happen with “web x.0”