VC: How the 'hypernet' is changing the Internet

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>>The things on our belt have changed the fundamental architecture of the internet. If we go back 5 years, Microsoft had 95% share of internet connected devices. Smartphone's, such as they were, were not web capable. There were no tablets. It was a very simple internet world. Today, half of all internet connected devices are Smartphone's. They go through a network that is not, that is not free and open, they go through cellular networks controlled by Verizon and AT & T. And yet, they're indisputably part of the net that we're dealing with. I would like to postulate that this net, this combination of the internet, plus cellular, plus WIFI, which I think, today, is a small piece of what it's going to be in 5 years. But, those 3 things together create a new architecture that I call the hyper net. And, the notion here is that, when you have 50% of the connected devices not beholding to the PC architecture, then Microsoft's market power has been reduced to something vanishingly small. And, when people do only 1% as many index searches on a mobile device as they do on a desktop, which is, in fact, the case, then Google's ability to control the world, through index search, has been greatly reduced. And, if you look at Facebook, a company that I'm directly involved in, and obviously a huge fan of, their inability to master user interfaces on devices like this, suggests that we have that, all together, too rare situation in technology, of a level playing field, and, I call that part, not the infrastructure, but the software thing, this notion of creating new user experiences in the mobile world, I call that the hyper web, because, again, Apple is not a player in the World Wide Web, IOS beat the World Wide Web, and it did it with a very simple formula. It did something different that people liked better. So, the notion that I want to you take out of this thing, the big ober thing, and I credit John Lilly at Graylock for this insight, is that we now live in a world where we're going to have literally billions of nodes at the edge, needing to connect to millions of different Clouds. I don't believe the Cloud is going to wind up being one thing, how can it be? I have 125 thousand photos is iPhoto, I'm not going to move them onto the web, so I need my home to be part of my cloud. When I look at all of this, okay, what I'm suggesting to you is that the competitive outlook, right now, is different than what we've all been dealing with for the last 5 years. The guys we've been most afraid of are actually hamstrung by their past success. Let's start with Google, in 1998, when Google showed up, the World Wide Web was open source, it was long tail, it was free, and it was anarchic. Google came in and said, "Guys, here's the deal, we'll never build a big industry here, if there isn't some level of organization. I've got this idea called Page rank, it will legitimize us, but I will stay true blue to the open source philosophy in all other ways. The result of that was 12 years, on html 4, with flash, and complete commoditization of all forms of content, because the platform never changed, and Google was able to drive brand out of all forms of content and capture the vast majority of the economic. And, three years ago, I started that on Smartphone's, people weren't doing index searches. What were they doing? They were using APPS that did something better. If they wanted to find a fact, they went to Wikipedia. If they wanted to find something about taste or money or time, they went to Facebook. If they wanted real time news, they went to Twitter. If they wanted a job, they went to LinkedIn. If they wanted a date, they went to Match. If they wanted real estate, they went to Realtor.com. You look at all these specialized search things, and they've been gradually nipping away at Google, and all of a sudden IOS comes along, gives them a chance to create branded APPS, right, and Google's got a big problem. So, what I'm suggesting here, when I say index search is peaking, I'm not saying we're not going to a inaudible that's not, that it doesn't create value or benefit to you, what I'm saying is that the most important searches people do right now, they do off their belt or out of their purse. So, the economic value of index search, relative to alternatives, is going to follow the same path that we're processing in spreadsheets, followed, as the personal computer industry matured. They went from being an argument to buy a personal computer, to being something thrown in with every purchase. And, I think that's where index search is going. Google's going to be fine, and not only going to be fine, I actually think this level playing field, and the return of Larry Paige, gives them a chance to really get it right. So, I'm not actually negative on Google, I merely think that they're not going to stop cool things from happening, and they may actually encourage some cool things to happen.

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