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Is Silicon Valley Past its Prime? October 4, 2010

Posted by Peter Varhol in Strategy.

So implies Daniel Lyons (a.k.a. Fake Steve Jobs), in an article in Newsweek.com.  Using the new movie (Social Network) on the founding of Facebook as a starting point, he points out that today’s entrepreneurial trend is to build companies that leverage social network in clever or not-so-clever ways.  His problem with that is that Silicon Valley and its tech culture have historically put its efforts into solving difficult technical problems, and is now to some extent putting its energies into getting rich quick following the latest trend, rather than advancing technology.

I sympathize with this point of view, but only a little bit.  Throughout recent tech history, startup companies and entrepreneurs have succeeded (or not) by choosing a problem space that hadn’t yet been solved, and found a solution.  The engineering problems spaces have long been the forte of Silicon Valley, where one technology breakthrough after another has produced a long line of successes and new foundations for advancing society.

Daniel Lyons laments the seeming abandonment of the engineering problem space by Silicon Valley in favor of social networking initiatives.  He speculates that the region’s new focus on technically easier initiatives shows a growing cultural shift from the journey being the reward to the reward being worth just about anything.

Engineering and R&D are significant engines of growth, and give the US much of its high standard of living through the wealth generated by technology advancement.  For years we’ve been lamenting the declining numbers of science and engineering graduates, and that problem may be showing its effects in Silicon Valley.

Social interaction problems are also hard, though clearly not in the same way as engineering ones.  And there’s certainly a number of “me-too” startups out there that are attempting to copy the success (mindshare, if not busines success) of Facebook, Twitter, and Foursquare.  In that sense, it’s a little like the dotcom boom.

But these companies are doing something significant, because they’re redefining how people interact with one another.  It’s clearly a major advance, perhaps the first social advance since auto and air travel made us a more mobile society.  The engineering technologies behind it are well established, but the manner of combining those technologies in ways that resonates with the human psyche remains pretty much guesswork.

It’s not at all clear at this point that we will see the type of breakthroughs in social interaction that we’ve seen in hard engineering, but that doesn’t mean these problems aren’t worth solving.  And solving them may in fact lead to a burst of innovation in other areas, as interactions demonstrate that we’re smarter together than we are as individuals.

Engineering innovation is an important driver for the economy, and there is a certain satisfaction in solving seemingly intractable problems.  In social networking, we may open new channels of communication, but it’s less intellectually satisfying in that it’s rarely clear that we have solved anything.



1. Nothing’s Wrong With Silicon Valley « Cutting Edge Computing - November 23, 2010

[…] the easy road in developing me-too social networking concepts, rather than work at addressing difficult engineering problems.  There was no evidence at this conference that difficult problems were getting the short end of […]

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