Not often you read a story that shows you just how dysfunctional Silicon Valley has become, and how much the valley has succumbed to money, greed, and PR Chicks. Michael Arrington though seems to have just about caught the angst between Web 1.0 and its eventual blow out and Web 2.0, which might be bubblishous or not, maybe not quite yet.

The press side of things is equally nuts. I wasn’t writing a blog in the first bubble so I can’t compare now to then. But entrepreneurs are no longer talking to us just to get our opinion and hope for a blog post and a little discussion. These guys need press to stand out from the scores of startups just like them. Saying no to them isn’t really an option. They show up at our front door with a bottle of wine or flowers. They instruct their PR firms to do anything necessary to get a story. More than once I’ve had a CEO break down and cry on the phone when we said we weren’t covering them. And more than once, I folded and wrote about them after those conversations. Source: Techcrunch

Web 2.0 and internet 2.0 have made a difference in how we are presenting data, while the quality of the data is debatable, the ability of people to add neat stuff to the blogs. There were also the good ideas at the time like MySpace, Facebook, Mashible, Programmable Web and others have all contributed to the idea that you can have cool stuff and do neat things.

Once anyone sees a multi million-dollar payday though, greed is going to be a big part of the equation. Most business schools teach that if you start a business, you need to know why you are starting a business and work out the goal for those businesses. Many folks see that as a bubble, and many see that as a quality of life issue. Mr. Arrington has hit the nail on the head, once it becomes about money, once it becomes all about building a business to sell out, product becomes secondary.

And that is where the bubble of web 2.0 is going to snap, places without product, or anything that will get a great audience of loyal 8%’ers who contribute is basically stuck, and any VC or fund that gives them money is basically not doing good basic business at all. They chase a trend, the process changes, people stop having fun and cookouts in the backyard.

The thing about this time around in technology though is that startups have a lot more options to getting things done. While there has been a lot of pressure to hire good people, all the good smart people are already employed. There is outsourcing, and S3 from Amazon to keep costs down, there are distribution points like YouTube and others to keep network costs down. Leveraging the existing infrastructure to make content is about the way that the business is going. Very few projects have to invest in infrastructure to get things done; others have made that investment for them.

That changes the nature of the investment, and greed always follows wild success like YouTube, MySpace and others.
This is a liberating process for all the good and bad ideas that are floating out there in the dot com 2.0 world. Eventually we will get back to backyard cookouts, but until the greed factor is significantly reduced, it will be a while.