The October 2008 Wall Street financial meltdown is already reshaping Silicon Valley. Everyone here is bracing for the imminent perfect economic storm of a deep global recession. Lay-offs at both start-ups and established companies have become de rigeur. Venture capitalists are advising their clients to cut to the bone. The Bentley dealerships and the local real-estate market have suddenly gone very quiet.
Just as the last economic miasma, the NASDAQ crash of April 2000, marked the end of the Web 1.0 and the beginning of the Web 2.0 age, so I expect that October 2008 will mark a symbolic watershed in the history of new media. The Web 2.0 revolution, with its over-supply of social networking businesses and user-generated-content sites, has become very stale over the last couple of years. So the October 2008 meltdown arrived just in time in a Silicon Valley perpetually on the move toward the next big thing.
What’s next? In some garage or dorm-room, some smart kids are figuring out the future of media and technology. Global financial meltdown or not, Silicon Valley’s creative destruction – its law of motion -- is unstoppable. My own sense is that we need software and services that resynthesize the digital and real worlds. As NYU sociologist Dalton Conley suggests in his 2009 book Elsewhere, USA, technology has unmoored us from our real lives:
Our daily lives have changed, slowly but radically, over the past three decades. The division between work and home has been all but demolished; our weightless, wireless economy encourages us to work 24/7; marketing has invaded the most intimate aspects of our lives; leisure has become a lost art.
Silicon Valley thus needs to work on reuniting work with home. Having destroyed leisure with their always-on media, the smart technologists needs to reinvent it. The digital economy now must figure out ways to speed up the analog world. Silicon Valley's laws of motion must become America's laws of motion. The weightless economy needs to become rewired in somewhere USA.