What hotel chain had the most rooms in 2015? Marriott. What company provides the most rooms now? Airbnb. What was the largest email provider in 2010? MSN Hotmail. What is the largest email provider now? Gmail. What was the largest company in America in 2005? General Electric. What is the largest company in America now? Apple. Who was the Superbowl champion in 2001? Tom Brady. Who is the Superbowl champion now? Tom Brady. So maybe he is the one thing that doesn’t change.
Do you know what Archie was? Archie was the first search engine on the internet. It was started out of the Computer Science program at McGill University as a way for the school to connect with the internet in 1990. You might not have heard of Archie, but its predecessors gained more popularity; Yahoo and AltaVista came along in 1995. Google appeared in 1997 and has turned into the behemoth it is today.
The first web browser was created in 1990 and was called WorldWideWeb. A couple of years later, Netscape Navigator launched in 1994 and quickly became the market leader in internet browsers. It took until the late 90’s and early 2000’s for Internet Explorer from Microsoft to get a stronghold on the internet browser market. This domination eventually led to the antitrust case against them and put Microsoft back as a company. Now, Chrome leads the charge on internet browser usage.
What about Six Degrees, ever heard of that? That was the first recognized social media website. Friendster, MySpace, Facebook, Snapchat, Twitter, Instagram, TikTok, etc., all followed in the years after. I’m not sure what the next form of social media will be next, but I’m sure there is a niche that still can be filled and new technology will create an even more immersive experience.
The list goes on and on of companies and technology down the road outpacing the initial instance. This is the beauty of technology and innovation, improvements are rapidly made for a more enjoyable user experience. There does come a point as the technology matures that is harder and harder to dethrone the largest player. We are witnessing that now by Alphabet dominating search, Apple churning out smartphones, Amazon being the default place for e-commerce, Facebook creating a treasure chest of personal data with their platforms, and Microsoft continuously owning enterprise software.
It’s really hard to think that someone will create a better search product than Google. There are competitors out there, but when a company is able to turn its name into a verb, they have come across something that most others won’t be able to achieve. Whether you are going to Zoom someone or Photoshop a picture, these companies have dominance over their competitors. Think about the $400M deal Microsoft struck with the NFL just to have their Surfaces to be called iPads by everyone. We would think that these verbs would last forever, but not too long ago you would TiVo a show or Xerox a sales report. Now those verbs are obsolete.
Bitcoin has been one of the largest financial stories this past year. An immense amount of wealth has been generated from people buying it. I’m not a Bitcoin or blockchain expert, but it’s a very fast-moving and interesting space that I’m trying to keep up to date. Blockchain technology is looking to disrupt all types of industries with the financial industry being at the forefront.
I’m a believer in many of the applications of blockchain. Whether it’s sending money, creating smart contracts, or using it as the basis for IoT devices to connect, I do see the value. Speeding up processing time, decentralizing information, and increasing security are all practical things that the technology can help solve.
In regards to Bitcoin, I’m on the sidelines and I’m ok with it. We are in uncharted territory and no one knows what will happen to the price. Some people are calling for the price to rise to over $100k by the end of the year while others may think it could crash. It could also just stay flat for the rest of the year. Nobody knows.
For me, I would rather put my money into something that I understand. It makes sense to me that I buy a share of a company and I’m entitled to a small percent of the money it makes. Whether it’s tomorrow or 100 years into the future, I believe the concept of wanting ownership of a company’s profits will remain true. The business that makes money tomorrow won’t necessarily be the same business that will be around 100 years into the future. Hats off to you if you are invested in companies that will be around 100 years from now. That’s why I’m a believer in putting your money into a broad market ETF where fund managers will circulate in and out of the companies that are producing money. I think that’s the simplest way to generate wealth for yourself in the long run.
It is a big deal that more and more companies are accepting Bitcoin as a way to transact. I need to think harder of how and why people would be incentivized to use Bitcoin to make their daily purchases in Bitcoin rather than USD. A logical use case to me for Bitcoin is immigrants sending remittances to their families in their home country. Making international payments is expensive and lengthy. Using Bitcoin cuts down on the expenses and the transfer time, but people take on the volatility of holding it. I think that the crazy rise in price could be a reason why people don’t latch on to it. If it is able to stabilize its price, then I think it could be a legitimate way for people to exchange monetary value.
Another interesting facet of cryptocurrencies is how many of them there are. I understand that Bitcoin is the current leader in the space, but how sure are we that it will continue to be the leader? If someone were to search for something on the internet in the US today, they will most likely use Google, but that wasn’t necessarily the case 20 years ago.
How far are we into the history of Bitcoin? Are we in the equivalent of the late 90’s for the internet? We could be at a point that this technology is ready to take off and completely change the infrastructure of how systems communicate. Is blockchain a technology that is like the fax machine? Very innovative for the time, but then it was later replaced by greater technology like the internet. Nobody knows. The only thing that I know is that technology keeps on improving itself. The key to this puzzle is to know how long the generation of technology will last.
I’m hesitant to think that Bitcoin is 100% the future. I have to accept my lack of gains by not buying if it continues to rise like clockwork. I’m ok with that. As of right now, I’m more inclined to believe that there will be greater innovation on top of the existing technology. I think it’s more likely we are at the equivalent of the 90’s for the internet. If you were an early investor in Google, then you’ve made life-changing money. Google is an outlier though, there were more internet companies that failed and don’t exist today than succeeded. That’s how I feel with all of the different coins that exist currently. I do think there is a very large movement behind blockchain technology, which can make some profound changes in society and how technology functions. I look forward to seeing how this technology can make the world a better place!
Peace and Love.