More Rational Exuberance? NO!

I’ve read several articles and had a lot of conversations with folks over the past week about the Google-YouTube merger. As many of you know – I certainly drink the kool-aid of my current employer – so please take this into consideration when reading this…

The large dollar amounts that are being used to purchase companies that are only modestly revenue generating – has spurned some people to ask the question – “is it happening again”? Is there another “bubble” we are about to create that is bound to burst?

Putting the YouTube purchase pricetag on hold for a moment – I am very sensitive of the aura of the “dot-com bust.” The industry I have worked in for about 8 years now has had it’s ups and downs … but certainly much more impact on the perception of the industry during the “down” portion. Getting recognition amongst (most importantly) traditional advertisers has taken time. It was so easy for an old school marketer to shrug off the concept of changing his/her marketing strategy due to the very public image issue.

So when so-called respected journalists write things that insinuate that it’s round 2 of the “Dot-Bomb era” – I get annoyed.

So what is different now? It’s very simple. Monetization exists and is understood. Sure, there is definitely a lot of “future potential” still baked into the equation – but in what business venture is vision non-existent?

In earlier years (1999/2000) the reason why the “Dot-Com bust’ happened was because the people spending the money (Wall Street) treated it like a wave …People in the board rooms didn’t understand the realistic aspect of internet advertising.

Fast forward 7 years - and it's a different story. Although the industry still has leaps to grow and evolve, it (in large part to Google and other monetization engines) has figured out a model on how to monetize eyeballs and content.

So - more on this as it matures - but please don't think Google buying YouTube for $1.65 Billion is a sign that the internet marketing industry is about to take two steps backwards. I think that after testing and learning - it will actually lead to some big steps forward in Ad Formats... Stay tuned.