Dan Gillmor: Intro to Silicon Valley

Dan Gillmor writes a column and blog for the San Jose Mercury News. He's also the author of the recent We the Media. RDVP invited him to give a perspective of Silicon Valley, ostensibly to those fellows coming from outside of it. In reality, he gave the requisite history quickly, and launched us into a free-ranging discussion of interesting topics, some of which I've excerpted here. The one thing that struck me most is that in contrast to my mental stereotype of a hardened, sarcastic journalist, Dan really seemed to care deeply about the community (broadly defined), and be personally affronted by violations of trust in it.

He argued that Silicon Valley is the expression of Moore's Law; and as everyday devices grew more powerful, had embedded memory, and became networked, they can revolutionize the way we think about them. His 5 factors leading to the creation of Silicon Valley were:

1. Pool of human capital
   
2. Culture of entreprenuerialism, risk taking (and the freedom of not penalizing all failure); also a flexibility and willingness to adapt business plans
   
3. Money (esp. proximity to Venture Capital)
   
4. Great research university: Stanford, with its fluid connections to business Berkeley, USF, and Santa Clara
   
5. Weather
   

Dan placed the start of the internet bubble at the Netscape IPO. And while he did place some blame on the greed of public investors, a quiet anger came through when he described the role of VC's, investment bankers, and brokers whom he accused of benefiting while they transferred their historical risk into the unsuspecting (or at least uninformed) public.

Asked about most exciting new markets and opportunities, he cited wireless, especially unlicensed portions of the spectrum, and web services.

On Microsoft: It remains to be seen whether the "enormous cost that the world is paying for the Microsoft monopoly will be balanced by the philanthropy [of the Gates Foundation]." It would be great if 200 years from now, the only thing Bill Gates was remembered for was his philanthropic work.

On Social Entrepreneurism: "Profit maximization is difficult to reconcile with projects for the greatest impact for people who need it most." But it is good to "bring rigorous skills to non-profits which have been a mess."

On housing prices in the Silicon Valley: Dan has said for more than a year now that there are bubble conditions in the housing market. There is no rational explanation for the rise in prices.

On Corporate Governance: The amoral nature of corporations, combined with the fiduciary responsibility of the board to maximize profits for shareholders is exacting an unknown long-term cost.

On the Future of Journalism: Every revenue stream for traditional media companies is under attack. It's unclear that they'll be able to survive. And while some news outlets (e.g., Local TV news) could go under with no major ill effects, the loss of real investigative reporting would be serious. Perhaps it will move to the non-profit sector, or the individual armed with blog and video camera. The explosion of independents would place a huge burden of quality assessment on the already over-burdened consumer of media. Google is a first cut at a "reputation" service that judges quality based on the PageRank (roughly, the number of incoming links). Objective reporting is unique to the late 20th century America; prior to that media companies did have a position, which they advocated in their publications. Functioning, quality media are a pre-requisite to a free society. Capitalism also requires honest information.

On the economy: This generation may face a lower income than the previous. Will cheaper goods and a spirit of volunteerism enable us to maintain an equivalent standard of living with fewer dollars?