Personally, I think equating geek cred with success is naive. Outside of the small world of hardcore technology geeks who think Slashdot, Engadget, Ars Technica and TechCrunch are the greatest things since sliced bread, consumers are not deciding what products and services to used based on the “geek cred” of the companies that offer them.

Let’s look at this list here:

1. Despite all the hype, MySpace still has more registered users, traffic and revenue than Facebook. Facebook’s ability to monetize at a rate that justifies its recent valuation is questionable at best.
2. Amazon’s success is driven by sales, not by Amazon Web Services. When institutional and retail investors look at Amazon’s stock, I think it’s safe to say that they’re evaluating revenue growth and profitability more than they’re evaluating how cool EC2 is.
3. Apple is a thought leader with substantial geek cred. That didn’t stop investors from hammering the stock based upon a financial outlook they didn’t like.
4. Google’s stock is down significantly since the beginning of the year and while the company’s aura may have played a role in buoying its inflated stock price the past several years, its impressive revenue growth is fueled by advertiser spending, not on all its geeky initiatives. Without that advertiser spending, it would have nothing of interest to investors.
5. Does anybody believe that the average consumer is sold on buying an HP printer or digital camera because they recognize HP’s geeky history? Of course not. People buy based on perceived quality, selection and price.
6. Adobe makes products people want and need. People aren’t buying Adobe products simply because Adobe “rocks.”
7. Claiming that Yahoo’s lack of geek cred is going to do the company in has to be one of the most amusing comments I’ve read recently. Yahoo’s problems have a lot more to do with mismanagement than lack of geek expertise.
8. Meg Whitman led eBay to where it is today – a company with a $40 billion market cap. It’s the leading auction platform on the Internet and one of the most recognized consumer Internet brands. The Skype acquisition may have been dumb, but overall, I the people behind eBay are laughing all the way to the bank.
9. Michael Dell was a leading innovator of direct-to-consumer sales and just-in-time manufacturing in the PC industry. It made him a billionaire. Dell’s recent problems are more the result of increased competition and commoditization than they are of consumers getting mad that he’s supposedly “anti-tech” (according to Hank).
10. Palm’s decline is related to lack of technology innovation, but that’s primarily due to a failure to execute and a failure to adapt to the competition.
11. IAC owns some of the Internet’s most recognized brands. In 2006, it turned a profit of $192 million on revenues of $6.2 billion. Apparently Diller, however, never received the news tech-savvy competitors are eating his lunch. And yes, the Internet is about media. The mainstream consumers that are using services like MySpace and YouTube are doing so because of the entertainment value, not because they now have some sort of ideological “access.”
12. Most mergers fail. AOL-Time Warner was no exception. But AOL’s decline was not due to a lack of geek cred. Again, increased competition, especially as broadband became more affordable, made it almost impossible for AOL to maintain its grip on the ISP market.
13. Almost 264 million handsets shipped in the second quarter of 2007. In that quarter, Nokia continued its consolidation of the market and has the greatest marketshare of any handset manufacturer. Motorola saw decreased marketshare. I’m sure Hank will tell us that when consumers around the world went to pick out their handset, they asked “Who’s geekier?”
14. Microsoft is a massive, mature business and the company acts like one. An intelligent person would not expect that a company the size of Microsoft to dominate all new markets (like the Internet), retain all the employees it’s made wealthy beyond belief and attract young job seekers who prefer stock options over salary. And despite being less innovative than Apple, it still dominates the markets they compete in.

Bottom line:

1. Geek cred only matters to geeks. Mainstream consumers, who still make up the vast majority of the population, don’t care. Mainstream investors are influenced by the almighty dollar, not who’s geekier.

2. All massively successful companies inevitably hit a growth plateau and it becomes hip to root for the underdogs who come along hoping to take them out. If anyone hasn’t noticed, this is even starting to happen to Google. It’s just the natural order of things.

The internet and technological innovation is all about media, Wall Street analyst hitting their numbers, and page views.

We can’t dump on it like a truck. It’s a series of tubes.

Suit.

If the answer is yes, then you need it. If it’s no, then so what?

The internet and tech innovation is all about media, Wall Street analyst hitting their numbers, and page views.

We can’t dump on it like a truck. It’s a series of tubes.

Suit.

Look at the list one more time.

How many of the companies on the list that are tech driven (geek cred) and perceived as doing well? How about in reverse? Correlation? Accident?

But let’s play this game anyway. Take the publicly-traded companies on your list, excluding AOL (which is a division of a much larger Time Warner). 4 of the 5 companies with the highest annual *profits* (for the last fiscal year reported) are on your “Don’t Have Geek Cred” and “Losing it But Not Lost” lists. 2 are on the “Don’t Have Geek Cred” list and 2 are on the “Losing it But Not Lost” list. In terms of the two social networks, as I pointed out earlier, MySpace (with no geek cred), still has far greater traffic and revenue than Facebook (with tons of geek cred).

Maybe all that matters in the small world of technology geeks is this notion of being perceived as doing well. In the real world, however, money talks and bullshit walks. And when you look at who is earning the most money, your theory seems to fall flat. Business and success are much more complicated than “geek cred.”

Indeed opinions are subjective. Yours, mine, all of them. On that we can agree. Nevertheless analysts seem to fashion opinions about companies and their trajectories all the time, subjective though they may be. These perspectives take far more into account that revenue. The companies (and divisions) that I have labeled as not having geek cred, are all generally accepted to be err… having trouble. The ones with it are generally accepted to be doing well. If we can’t agree on this then there really isn’t much more to discuss.

By the way, in case you missed it, geek cred, is a metaphor for actually having some technical mojo. Being able to deliver complex products that are technically respected. Thats *why* they have geek cred. If you don’t think that’s important, well we will just have to agree to disagree. Seems pretty basic to me.