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Prediction Two: In 2010 Google Becomes the Fourth Bee Gee

Submitted by on December 21, 2009 – 10:41 pmNo Comment

GD*5791397I have an old friend – let’s call him Dick – who successfully created mind-numbingly complex financial instruments during the best of times (2007) and the worst (2009).   One area where Dick has shown particular genius is in dealing with event risk and hedging against future calamity.   One such product Dick modeled – but never deployed – played up the notion that news –from politics to personality news –  follows a “sentiment frequency” from trough to crest.  At the crest, the news is dominantly favorable, at the trough, unfavorable.  You can’t stay on top forever goes the old saying and Dick realized that your fall (or rise) was more predictable than one might think.     By combining sentiment mining with some complex math you could assess (1) the status of an element in politics, celebrity news etc.  (2) the duration of its placement in the frequency and based on those two factors, the likelihood of a change on the frequency spectrum.   In other words – when your star was at its zenith or nadir and where you were headed next.  It was a crude instrument but when trading against the future – it was accurate above 50%.  Enough to earn money.

The punchline is that being in or out of favor in the news is not purely driven by business strategy or tectonic market forces.  The logic of the news is driven by our collective appetite for change.   The longer you have been on top, the more likely it is that the news will go against you.

The current poster child for this phenomenon is Google.

Google has ridden the crest as long as it could and now it has lost control of its own image.  The pundits must take it apart.   It is not a matter of truth, facts or profit and loss.    Perhaps the end of the love-in came with Jeff Jarvis’ business equivalent of hagiography “What Would Google Do?”   When your brand is a stand-in for Jesus, I mean really – where else can you go?   There followed a series of articles that took direct aim at Google.    These articles ranged from the insightful – Anil Dash – to the reductionist – Scoble parsing one sentence from Eric Schmidt as biblical prophecy governing all of Google’s efforts.

My point is not whether the analysis is “true” or not.   My point is that the tide of sentiment has crested in 2009 – and Google will slide into the trough of negative speculation in 2010 just because… well – just because it makes for good news.   I predict some anti-trust rumblings towards the end of the year despite the fact that Google (having learned from Microsoft’s mistake) has a big presence in D.C.

Google will be the Bee Gees of 2010 Tech and the fearsome wrath of the news cycle is upon them.     To quote those same mighty pop-smiths “Tragedy – when the feeling’s gone and you can’t go on – it’s tragedy.”

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