Instagram is fun, and by all accounts its founders are really good engineers. I don't begrudge them their success. But think about what Instagram does: taking a picture of your dog, coloring him blue, and posting it somewhere so that all your friends who have nothing better to do can see it instantly.
Maybe I'm old fashioned, but there's something sick about that being worth $1 billion. Suppose that much capital were invested in solar power to keep us competitive with China or a startup that might invent a battery to power an electric vehicle for 500 miles between charges -- I can dream, can't I?
Beyond the lunacy: The triumph of mobile
There is, however, another side to this, and it's the primacy of mobile computing. It used to be that developers would start with a Web application and later on figure out how to take it mobile. But now the opposite is starting to happen: mobile first, and desktop later, if at all.
We have immensely popular companies like Rovio and Foursquare with millions of users and no ties to the desktop. It's no accident that roughly 10 percent of the money venture capitalists are putting into tech went to mobile startups in the last quarter of 2011, according to CB Insights.
Consider Apple, now the world's most valuable company. It didn't get richer than Exxon, not to mention Microsoft, by selling a zillion MacBooks. Its fortunes turned when Steve Jobs and company cranked out a succession of mobile products starting with the iPod, followed by the iPhone and the iPad. The vast majority of that explosive creative energy came from within, not via acquisitions -- certainly not by paying $1 billion here and there for simplistic startups.
This article, "Facebook's Instagram buy: The new dot-com bubble," was originally published by InfoWorld.com. Read more of Bill Snyder's Tech's Bottom Line blog and follow the latest technology business developments at InfoWorld.com. For the latest business technology news, follow InfoWorld.com on Twitter.