This is the same argument that was used in the dotcom bubble -- profits don't matter because tech is different.

The fact that it's being trotted out again as justification should worry you.

There are two primary differences between 1999 and now in consumer web: 1) there's a massive advertising market now that works; 2) for 99.999% of web sites, it has gotten drastically cheaper and easier to operate, and over another five or ten years, will become nearly free (what will $10 buy at Digital Ocean in another five years?). Traffic and resource demands for most web sites will not keep up the value proposition improvements we're seeing, it'll push the cost toward zero.

Those two differences have in fact changed the landscape. I can run a couple person startup that generates millions in ad revenue now, with exceptionally high margins. Plenty of Fish is the most famous example of this. Techmeme essentially worked like that, as another example. Hacker News could be like that, if PG wanted it to be.

Point being, it's now drastically easier to monetize traffic long term, compared to 1999 (when the ad market was tiny, backwards, poorly standardized, difficult to utilize, and not very developed for all industries / segments).

But, tech is even different-er now.

Go back to 1999 and build a website supporting a million concurrent users. How much hardware do you need? What are your fixed costs? What are your engineering costs? How do you even market your thing?

Now do the same today.

What's different?

The hardware cost is low, as is the barrier to entrance. And the users' expectation is higher.

To attract today's users, you still have to be better than your competitor's website. The fact you can easily build a website for millions doesn't mean it will actually see millions of visitors.

To me it is like pop music. Once and awhile a band like The Beatles comes along, enamores the whole world for a few years, and then fades from the popular conciousness.

Treating The Beatles like General Motors is where the problem lies. Twitter, Facebook, Snap Chat and their ilk are more like the supergroups of yesteryear than the industrial giants that our investment infrastructure was designed to support.

Bad example. When did the Beatles fade from popular consciousness? They've been outselling most other artists for 50 years non-stop.

Vanilla Ice might be a better example.

The problem with labelling something "proto-singularity economics" is that the whole point of a "singularity" is to hit a condition in which economic production completely outstrips not merely the demand for goods (overproduction) but even the ability to charge for goods (scarcity as experienced by people). We are still at the stage of a mere capitalist overproduction crisis and its ensuing capital glut.

It may well be true that we could convert our current economic condition into a post-scarcity economy by shifting away from capitalism, but at the moment we're stuck in an overproduction/overaccumulation/debt crisis.

> Even with no revenue, it's worth something, right?

No one is saying it's worth nothing.

They're not saying it directly, but that's what they mean.

They are saying "X is not worth this huge valuation" which implies the person saying that thinks there is something "unfair" about the multi-billion dollar valuation.

But, this naysayer person has a proper "fair" valuation in mind based on their complete outsider knowledge. To them, it's actually worth nothing (no revenue == if someone buys it, they can't make money == it's worth nothing), but they'll concede a little since a lot of people use it.