Electricity greatly improved our quality of life. But I'm not going to get excited about buying a basket of utility companies. Same for the Internet. Can't live without it, but can't live with it (in my portfolio).
James Altucher will eat his words. To count tech out at a local minima is absolutely absurd. Fred Wilson is right: Tech is alive and well. But there are deeper reasons than what Fred Wilson mentions.
Other than computing technology, what field can boast exponential gains? Green tech is much talked about of late, but what are the rates of improvement for battery power, photovoltaics, and clean energy? Miniscule, in the single digit percentages. We can only wish for exponential advancement in almost all fields of technology. It's just not a reality.
With computers, we are blessed by the exponential curve of Moore's Law. Ray Kurzweil plots this exponential curve:
Just look at the innovation that has happened in 40 years. Bill Gates is famed to have said in 1998: "If General Motors had kept up with technology like the computer industry has, we would all be driving twenty five dollar cars that got 1000 miles/gallon."
Instead, GM has gone bankrupt, and now we have one-inch-thick netbooks that we can buy for less than $300 that provide 300,000x the computing power of the ENIAC, which cost $500,000 and filled a very large room in 1946!
The exponential march of software begets the exponential march of software capability. Software has gone more and more high level. Instead of slinging machine-readable bits, we started writing assembly. Then C/C++. Then Java and Perl. Now, Ruby and Python -- each step is less efficient for the computer but more efficient for the human. In 1946 you needed a PhD to even get near a computer, and only now are we seeing the rise of the truly interconnected, paperback computer that costs next to nothing but is indispensible for everyday life -- not just for an educated elite but for every person on the planet.
The advent of the Gutenberg printing press and modern mass-produced book changed society at its core -- at its basic fabric, humanity as a whole became more educated, more equal, more enlightened, and far more human, rising out of the depths of ignorance. The rise of cheap, ubiquitous books formed the modern world. But now we have a book that is infinite in length and unbounded in capability to teach, share, educate, and think.
So we've got an exponential engine of innovation, and it is transforming society before our eyes. And we're at a such a local minima where the WSJ is calling the whole engine dead.
We're still only beginning this mad experiment of infinite and ubiquitous computing. The greatest, most earth shattering software has yet to be created. On the upslope of an exponential, you'd be insane not to go long.