We are seeing an unprecedented period where large net companies are gobbling up smaller ones or merging with other big players.

There have really been three phases of the net, and I believe we are witnessing the fourth, which, in a few years, will lead to a fifth that will span a century or more.  Before I go into the fourth and fifth, let’s first briefly cover the first three:

1. 1980s & early 1990s: Invention and Discovery. Ethernet, email, and other key technologies were invented in the 70s, but it was in this time period when we first starting putting it together.
2. Mid 90s to early 2000: Build Up and Speculation. Once Wall Street caught up with the power of the net, and companies started seeing significant savings from networked applications, everyone wanted to get in early on this great new technology.  At the time, many thought it was a greater invention than practically any other.  Y2K spending also drove late century investment.
3. 2000 to 2003: Adjustment to Reality. Since Y2K didn’t end the world, the world woke up to the reality that we had other problems to solve, and that the profits weren’t really there.  To some degree, I think there was an over-adjustment, but it was very necessary.  There were a few great technologies invented in this time period, but generally it was a period in which paper millionaires became paperboys (and girls) again.

The new buzzword is “social networking” (actually that’s two!) and suddenly investment dollars are flowing that way, almost to the extent that it did in the second phase. It’s no surprise to me or anyone who’s paid attention to the growth of the Internet over the last 20 years - of course social networking is big!  That’s what the frickin’ Internet was (largely) created for! 

After years of observation, I believe that this is just a part of the thing that is the Internet.  There will always be a “latest thing,” but there is an important difference: now, the “latest thing” is just a normal part of the business.  It’s like any other business - new products come along, and either they survive the market or they don’t - but regardless, they get a lot of press up front.  So, no, the fourth stage isn’t about social networking.

The fourth stage I call the Cooling and Coagulation phase.  I call it this because I liken the metauniverse of the Internet to the creation of a new place, like our precious Earth or Moon.  The creation of cyberspace; whatever you want to call it, this thing that pervades our culture…it’s here to stay.  The corporations and civic leaders who shape our history, our safety, and our future, know this.  It’s becoming a part of our daily lives, and investors are simply claiming their flag on the moon like everyone else, with a serious eye for the future. One of the best ways to grow that stake is to simply combine your assets with another.

There are signs everywhere that the average person on the Internet is getting older, as both young and old are going online.  The number of people who grew up with web access is growing every day - if you think about it, there are kids who were born the same time as the web browser, itself, that will soon be joining the workforce.

The fifth stage, coming about 3-5 years from now, is True Integration.  This is the time at which the web, and mobile technologies, are such a part of our lives that we finally come to realise, as a global society, that this form of communication is fully integrated in every aspect of our lives.

Some people think that movie theaters and local television and radio stations will eventually fade, but I honestly don’t think they will.  They will, however, change significantly.  TV stations will go back to their previous heyday of creating original content, broadcasting news live from the scene directly to the web, instantly sharing it on Youtube and everywhere people want that content, and getting revenue based on unique views of that content.  Local TV News content will ultimately be embedded in other sites, shared and forwarded.  Local television sites are struggling to compete with page view and unique user/CUME powerhouses.  They just cannot compete on that scale - but they have a secret weapon that they don’t even seem to be aware of…their ability to produce relevent, engaging, geo-targeted video.  If I were in TV, I’d double my street team and put HD cameras in everyones’ hands.

The Googles and Yahoos of the world don’t have writers, producers, and cameramen in every city on Earth.  As wealthy as these big web companies are, they don’t have the infrastructure to do that.  Local broadcasters, on the other hand, do.  In the not-too-distant future, every major market around the world will have a small handful of sites that serve that market.  As the Net finally reaches the fifth stage and is truly integrated into our lives completely, we’re all going to be hungry for local content.  When big news happens in Phoenix, the story will be instantly embedded in hundreds of other sites, with users around not only our own community, but the world, watching.  Those kinds of events, merged with localised news, local entertainment, music, event planning, and social networking will collectively generate billions of dollars in local markets.