I totally agree with O'Reilly, Companies like Slide and RockYou do not deserve half a billion valuation and I am pretty much sure Max Levchin can do better than make social apps for Social-Networks.
How do you decide what's worth half a billion dollars? If a social network app will drive half a billion dollars worth of advertising profit over N years, then it's worth half a billion dollars, even if the same effort is better spent combating malaria.
Advertising revenues on social networks have historically been pretty poor.
I think what O'Reilly was getting at was people forming their startups that essentially chase the latest trends in what now amounts to a bubble. He makes a valid argument and we could all be looking back at what he said in the future and only realize then just how spot on he was.
I think you're probably right, but I also think there's a lazy argument out there that you could go halt malaria instead of making ad money, and that's a stupid argument; make the ad money and spend it on malaria if you're that committed.
You don't have to fight malaria or stop making money form ads. If you're going to make an ad supported app at least make it do something useful (GMail is one example of a useful ad supported app).
I think he recognises that - the article quotes him as saying "I really believe in markets, and I believe in the power we all have to build great companies that change things.".
Do you really think SuperPoke or Top Friends has the potential to make a Billion, I really don't think so. Throwing a sheep or sending a drink is of no value, it might excite someone in short-term but it really has no value in long-term business sense.
You are getting it wrong, We are talking about Half a Billion Dollar worth Businesses not some tv shows. Are these Companies or products worth the money they are valued at, Are they creating sustainable businesses and products and Are they helping or improving technology and community as a whole.
