Finding the True Value of Web Technologies
Alex Iskold's latest post coins a new term: The Digestion Phase. Alex says that the latest wave of technology, which started in early 2003, has peaked:
"We have entered a digestion phase. It is not a burst, nor a recession. Rather, a digestion phase is a period of time for us to reflect, to integrate, and to understand recent technologies and how they fit together. It is the outcome of this phase that will decide if we continue to slide or if we rebound and start climbing back up. The deciding factor will be the true value of the technologies that we created."
(emphasis mine)
This kind of thinking excites me - it's focused on the technology of the Web, moreso than A&M, VC money, and other peripheral things (important as they are). As Alex writes later in the piece, the digestion phase means thinking about the real value of technologies; and building on them.
As an example, Alex mentions the CBS acquisition of Last.fm - he said it is an opportunity to play in the hot online music market, but CBS needs to figure out best way to turn this network into dollars (text and banner ads might not work given the culture).
I'm also seeing evidence of The Digestion Phase in how bigger companies are carefully utilizing the hottest web technologies - Yahoo.com's implementation of video, which we reported today, is one example. And today I spoke to one of the oldest and more conservative RSS Readers, which is undergoing a re-design that implements some of the latest RSS trends of the past year or two. In both cases (Yahoo and the RSS Reader), new Web technologies that work and add value are being implemented into successful products.
The best part of The Digestion Phase though is that it's no longer about hype, which was the over-riding factor a year or so ago. We've got to a point where the technologies are real (not just theory) and there is true value for mainstream people. Thanks Alex for articulating that and I encourage you to read his post and comment on it.
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Nice. You might want to switch metaphors though when the post-digestive phase inevitably arrives!
Posted by: Gabe | August 23, 2007 1:00 AM
Any technology that makes a user happy is a good technology :)
Posted by: awflasher | August 23, 2007 1:15 AM
Richard I left a comment on Alex's post and ill add a bit more to it here. I essentially dont agree, and don't understand if this digestion phase is referring to:
1. A phase in the development of a startup company
2. A phase in the level of early stage technology investment
3. A phase in overall technology development and innovation
During the development of a startup, it is essential that founders and management 'digest' as often as possible, if only to check that they are still on-course.
As for tech investment, its at the highest level it has been since early '00 - the only thing that VCs are digesting right now are all the lunches they are having with entrepreneurs :)
And with 3., as I said in Alex's post, overall technology innovation and development are always increasing. For eg. the technologies he cited were all developed during the down-cycle, and the social networks he cites were all built initially without venture investment and with a lot of them were built during the down-cycle too
Posted by: Nik Cubrilovic | August 23, 2007 2:17 AM
It seems to be a new term for an old concept: not fundamentally different from Gartner's "hype cycle" curve in form or meaning.
Posted by: Sandy Kemsley | August 23, 2007 6:00 AM
Hi Nic,
Thanks for your thoughtful and complete feedback on these posts. The Digestion Phase refers to the state of the industry. This is a point on the curve / trajectory where there is a slow down to absorb the previous innovation.
It does not mean that we stop innovating during this time. Not at all. We still innovate, but the new things are not absorbed quickly because we are saturated from previous years.
Maybe this metaphor will work - diminishing marginal utility from Economics.
Alex
Posted by: Alex Iskold | August 23, 2007 6:51 AM
There is definitely much more room to climb.
The innovation will continue.
Posted by: Howto Monster | August 23, 2007 6:52 AM
@Nic and Alex: Maybe you could think of it as an all you can eat buffet. There's still plenty out there to eat during the digestion phase, but once you've had your fill, you have to sit back and cool out for a bit before you go back and hit the buffet line again.
The food doesn't stop coming, but this is a pause in between stuffing our faces where we reflect on whether all those corn dogs were such a good idea.
(Maybe I'm taking this food metaphor too far... ;))
Posted by: Josh Catone | August 23, 2007 9:18 AM
@Josh And Alex: As humorous as it sounds, the buffet metaphor is a good one for innovation within the industry. The digestion phase helps us make choices on which foods to continue with, and also which new additions to the buffet we'd like to try on our next trip--not to mention which foods seemed like a good idea but ended up leaving a bad taste in your mouth! :)
Posted by: Benjamin DiGregorio | August 23, 2007 12:16 PM