Every time there is a new phenomenon, two groups of people emerge. The advocates predict new world order and teach the less civilized part of the population all about the new tools and ways of making business. Not far behind follow the second group, the antagonists that predict the doom to all those believing in sudden changes. 

Social media is definitely in the peak of hype at the moment and a classic phenomenon that attracts both advocates and antagonists. I must admit that I am a social media junkie myself – just give me a hint of a new service and I’m all in. At the same time I am rather critical to new business opportunities and thus have managed not to take sides in the debate of whether social media brings us to the garden of eden or gates to hell. 

The Internet business is not what it used to be in the ”good old” hardware and software times. Business models have become complicated consisting of free services, open source software and user-generated content. At the same time the amount of users has become a meter of success to services. There’s nothing wrong in that compared to the brilliant services of the 90’s that had great business models but no users. However, the leap from a free service with millions of users to a profitable business is still a long one.

On the other hand, we can criticize the criticizers as well. All kinds of doubts have been presented about the viability of the business reminding and warning about the horrors of the Internet bubble in the late 90’s. Then again, if we think what has happened with Facebook for example, the evidence is convincing; the amount of users have grown from 30.000 to 300.000 in Finland alone in less than 4 months. Over 50% of the Facebookers go there every day and many of them prefer spending time in Facebook to watching television. These are sound arguments against those saying that nothing changes. The impact in media behaviour is imminent and denying it is short sighted. 

I would not put my millions, if I had them in the first place, to social media services. Not anymore, because I’ve heard taxi drivers talk about Facebook. However, looking back to the actual dot-com bubble, the Finnish market was different; undeveloped venture capital market, huge amounts of money easily available and businesses based on future expectations and market share instead of sound business models. In Finland another Internet bubble is still far away and instead of predicting doom we should figure out why so few Finnish companies break internationally even though they are in the forefront of development. 

That’s the thing we are doing our best to help with in the DIGIBUSINESS cluster programme for the next six years.