SANTA CLARA, Calif.--Roger McNamee is a thoughtful and accomplished investor. He is also prone to hyperbole. As an investor in Palm, he famously said, "June 29, 2009, is the two-year anniversary of the first shipment of the iPhone. Not one of those people will still be using an iPhone a month later." (The original Bloomberg story is now offline.) And today at the Always On Silicon Valley Innovation Summit, McNamee, an investor in Facebook, said to the audience of entrepreneurs and venture capitalists: "If everyone here hasn't been on Google+ today, it's doomed. They are off to a rocky start."
That's crazy. Google+ is just barely digging into its hype cycle. It is far too early to call this product's failure.
McNamee's talk at the conference was at turns hyperbolic and prescient. Discounting the chaff, I took away one observation that I think is accurate and that has important implications for content companies: McNamee notes that, thanks to HTML5 on the Web and apps on devices like the iPad, Google's dominance will wane.
"The people most harmed by Google's success have been the people who create content," McNamee said. "They've seen 80 to 90 percent of their value captured by Google."
But thanks to new branded search experiences, especially in apps, "indexed search is peaking." As McNamee says, today when mobile users (the users who matter for the future) are searching for a fact, they go to a Wikipedia app. For a restaurant, they go to the Yelp app. For a date, they go to Match (or perhaps OkCupid; McNamee's talk may be dated). What they don't do is search on Google. "All these specialized search things have been nibbling away at Google. It's got a big problem."
The rise of apps, the success of Apple's tablet, and the move toward HTML5 on the Web means that content creators have new opportunities to create branded experiences. Those experiences, if done right, will take traffic away from Google's search engine.
The importance of HTML5 in this argument was not at first clear to me. After all, content in HTML5 is just as searchable as older Web content, and much more so than Flash content. But I think what McNamee is saying is that mobile apps can be written in HTML5, and as they become popular on mobile devices, users will be happy when they start getting transferred to the Web and computers--making trouble for Google, which to date has been the main gateway to Web content. By this argument, the Dashboard in OS X Lion is a major anti-Google move on Apple's part.
"Google was able to drive brand out of content," McNamee says. With the success of apps, he says it becomes clear that "people want to hide technology [like search] at the margins."
I do tend to discount McNamee's prognostications, but in this case he's on to something important. Not the rise of apps, since that's utterly obvious. But rather the fact that the apps will infect desktops since the user experience is superior to either search or traditional software. And I think he's right that content creators can win back some ground in this transition. If--and it's a very big if--they learn how to create tight, fun, fast apps that get users to the content they want faster and more easily than Google can. I think that is indeed possible, and that it can shift the balance of power on the Internet.
McNamee says that the shifting device landscape on the Net makes for a level playing field, too, but I don't think that's quite right. Microsoft and Google may not be winners here, but one company is set up for apps better than any other right now: Apple runs the best marketplace for on-app purchases, including in its revenue collection plan in-app purchases. If McNamee is right about the shift toward apps, I think it's clear who's got the early lead as the new gatekeeper of Internet content.
See McNamee's seven slides (linked from the picture in this story). His Always On talk appears to be a cut-down version of a previous slide deck, 10 Hypotheses for Technology Investing (PDF).