In any other business but the web, if you heard the following things, how would you react?

• A company is valued at $15 billion
• Said company makes a nebulous product that is supposed to help connect people, but usually just wastes their time
• Said product can be easily replaced (more effectively) by a simple email or phone call, or a comment on one’s blog
• Same product cannot be evaluated objectively because its benefits are vague — some say it’s good, some say it’s useless
• Other companies are building little bits of add-ons (mostly useless) for said product, in a bid to cash in on the hype
• Journalists (or so-called journalists, but mostly techies that drool after every new thing) are hyping it up and calling it the next big thing. What’s worse, they’re saying that if you do business in that sector, you must use it or face extinction.
• Truth is, most people are getting along just great without it, so you know it’s all just hype

Witness the current Facebook hype circus. I thought it was all just plain ridiculous a few weeks ago, and still think so. Apparently, Microsoft, desperate to maintain its grip on the market and its brand dominance, is trying to buy either a stake in Facebook, or all of it.

Why? I have to ask why? How in the world did a web company that makes a product that connects college acquaintances/friends get so stupidly overvalued? How did it get so bad? I have to blame the press. They’ve been talking it up like crazy. Certain prominent Facebook users have been bragging and raving about its capabilities. I feel like dumping a load of cold water on their heads to wake them up. It’s just a stinking social site, people! It’s a time-waster! It was designed as a way to spend free time catching up with people from your past. It should have no more importance than that.

In real life (not Silicon Valley) if Facebook went dead, people would barely miss it. They’d miss it sort of like they’d miss a VCR. Yeah, it was entertaining while it lasted, but it’s time to move on. They’d certainly not miss it like air conditioning or food. So why in the world is the press and Silicon Valley making such a big deal about it?

Well, in spite of what tech bloggers and journalists may say (and they’ll spout things like objectivity or accuse you of being totally clueless when you speak of these things), they’ve got a personal investment in hyping stuff up. Here’s why:

• For one thing, they’re under pressure — pressure to put out news, and pressure to stay on top. They have to generate content, that’s how they make their living. They also feel a need, actualized or not, to stay on top of their game, and to say interesting or catchy things.
• To do this, they must position themselves as experts, and sound authoritative about what they say.
• They must pick a side. They can’t always be on the fence about stuff, it would make for pretty boring content. Let’s face it, people are attracted to polarized views.
• It’s better to say positive things about products than negative things. That way, you stay in favor with the big wigs, and they may even kick you a bone here and there.
• When you feed on hype and spew out hype, you start to believe it. That’s why people get belligerent when you confront them with a different point of view. Try it for yourselves and see what I mean.
• They may get kickbacks from the products they push to their audience. This stuff goes on behind the scenes, and we don’t know about it. I’m not accusing anyone, just saying that it happens.

Do you start to see how all this stuff falls together? I did a lot of thinking, and realized how pointless it is to try and keep up with most tech news. For starters, it’s horribly biased. We, as the audience, keep drinking the Silicon Valley cool-aid, and we keep buying into the hype at the advice of “experts”, only to find out that we’ve just wasted our time and effort by using something that has no tangible value to us. Let’s face it, most of the Web 2.0 products have little, if any, practical value. I can name the good things on the Web 2.0 landscape on the fingers of one hand.

All of this would be fine and dandy if all this stupid hype didn’t endanger the economic landscape of the web, and on some level, that of our country. It was stupid, senseless hype that did in Web 1.0, and if things continue the way they’re headed, with bigger and bigger valuations for pointless products, this hype will do in Web 2.0 as well. That means a lot of legitimate, worthwhile products will have a much harder time getting funded or staying alive.

Let’s not also forget that our country is on the verge of a recession, caused by another wave of stupid, senseless hype and speculation in the real estate market. When that bubble burst, a lot of people found themselves in a lot of hot water. We all know the story of mortgage defaults. We’ve heard it plenty in the last several months. A lot of good people now can’t sell their homes, even though they’re not trying to speculate, but simply need to sell.

I think if the Web 2.0 bubble burst, it would be the straw that broke the camel’s back. It could really push our country into a recession. But do these tech journalists and bloggers care about that? Do the owners of Facebook or Microsoft care about this? No, they don’t. All they see is dollar signs. They want to make as much money as possible at the possible expense of the health of our economy. This is what angers me more than anything. A few rich asses are going to make out royally while the rest of us suffer. And the sad part in all this is that those people that hyped up all these pointless, useless products aren’t going to get much out of it. They’ll just end up feeling really, really used.

I’d love to see a sense of normalcy return to Web 2.0 valuations. I’d love to see products and companies getting funded at their true market value, not some cockamamie, made-up numbers that mess up the rest of us. We can start by ignoring overvalued companies and the people that hype them up. That’s what I’ll do, anyway.

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