McNamee’s bottomline? Everything is changing.
More specifically, a few big themes:
- Microsoft is toast because we’re moving to a post-PC era;
- HTML5, the new web standard that allows to make interactive web pages, is going to revolutionize the media and advertising industries;
- Social is “done”, it’s now a feature, don’t go do a social startup.
Here’s what we thought were the most interesting points and assertions from the speech (quotes are paraphrased):
- Microsoft’s share of internet-connected devices has gone from 95% to under 50% in 3 years;
- Windows no longer provides measurable ROI to enterprises, who will shift spending to other products and services; this is a huge opportunity;
- Google is a victim of its own success: its search has become polluted by SEOs. What shows that Google has failed is all those “non-search” services that really solve a search problem, like Match.com or Realtor.com. If you add them all up, they account for 50% of searches.
- HTML5 is going to change everything. “In HTML5, an ad is an app, a tweet is an app, everything is an app.” “It’s a blank sheet of paper, and creativity rules again.”
- For example, “my band is putting out a full HTML5 site. You can watch all of our shows on an iPhone, live.” It’s very cheap and it changes the game because they don’t have to pay anyone anything.
- In HTML5, you don’t need to have display ads: Amazon can have a section of its store as an ad. So if you’re reading a book review, you can buy the book right from the page.
- Because HTML5 can make sites rich and interactive, engagement on a site can go from seconds to minutes.
- So a site could say: we have 5 sponsors today, which one would you like, and the sponsor follows you around throughout your experience on the site. “The fact that you can create and satisfy demand in the same place is only true in infomercials today, but it will be true on the web.” This, in turn, is highly disruptive to TV advertising.
- “The iPad is the most important device since the IBM PC.”
- “Apple will sell a hundred million internet-connected devices this year. That’s two thirds of the PC market.” If you add the other non-PC internet devices, that’s more valuable than the PC market.
- The iPad is the training wheels for HTML5. iPad apps show us what we need to beat in terms of creating a better experience on HTML5.
- Apple is an unstoppable freight train. In terms of tablets, it has no competitors and will probably end up with iPod-like marketshare. “It’s like IBM in the 60s; I can’t predict what that means; you need to find a way to play with it, but you also need to find a way to play over it” with HTML5.
- The fact that most people now have more than one device means the cloud is vital, because you want to have all your stuff on all your devices. It also means the old PC paradigm is dead, because the old PC paradigm means everything stored on one device, instead of everything in the cloud synced to many devices.
- In terms of keeping your stuff in the cloud, “Google, Microsoft, Facebook and Apple have completely failed to get the mobile experience right.” (We’ll let McNamee stand by that statement.)
- “Facebook has decided that they’re Twitter on steroids”.
- Currently Facebook Connect is free; eventually they’ll charge for it because it’s access to their social graph which publishers need, and that’s how they’l make money.
- Don’t try to be “social”: the big social platforms are created. You can’t create a social company, it’s just a checkbox. “The last 500 social companies funded by the VC community are all worthless. I’m serious.”
- But this creates an opportunity: while everyone is focused on social distribution, there’s a huge opportunity to get content right with HTML5. “Let’s create a new product, the way music videos were a new product.”
- Apple makes more gross margin per iPhone than most Android phones make in gross revenue, McNamee says.
- “Television is the last protected media business,” but it’s going to get disrupted. For one, once televisions are computers, analytics of who watches will get more accurate than Nielsen panels. “Everyone knows that if we go to actual measurement, ad rates will collapse because the numbers aren’t as good as Nielsen makes them look.”
- McNamee also had a few words about the economy: “we’re about 40% of the way of deleveraging the global economy, but we’re only 10% of the way of deleveraging the US consumer…I don’t care what your politics are, removing government demand from the economy when it’s struggling is ridiculous.” And to prop things up, the Fed is printing money and inflating bubbles, “but for us, that’s great!”: capital is very cheap; consumers are acting like the party’s on, so there’s lots of opporutnities.
- McNamee says he does “full contact investing”: he proves the concepts of what he invests in by trying them out with his band. So he knows HTML5 is going to work because it works for his band. Then he added, to audience laughter: “You’re going to say it’s a dipshit little band, yeah, it is, but we like it and our fans like it” and it works.
And here’s the whole video, interesting throughout: