Snapchat to Facebook: $3 billion isn't cool. You know what's cool?

Walking away from $3 billion -- or maybe $4 billion, says the grapevine. Surely, the dot-com bubble must burst now. Right?

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As Lee Munson of the appropriately named Naked Security blog notes:

Savvy users can take screenshots of their devices when the image is displayed but apps such as Snaphack Pro circumvent the auto-destruction of previously viewed photos and allows users to post images directly to social media sites....

While having sexy photos of yourself appear on social media sites may be incredibly embarrassing, having images of questionable legality may prove far more troublesome.

Lest you think Snapchat appeals to only prurient interests, it's also been implicated as a tool for cheating -- on tests! -- and even insider trading, as if either angle cleans up its image.

Given all that, why is Facebook so hot and bothered by Snapchat that it felt compelled to offer cash -- not the Monopoly kind -- for the service? Because among the Bieber generation, Facebook is dead. It's something their parents use. Nothing could be worse. This does not bode well for the future of the world's largest and most annoying social network. For Zuckerberg et al., it's a question of survival. Facebook doesn't want the app as much as it needs Snapchat's users.

If the rumors are true that Google countered with a $4 billion offer -- which Spiegel also allegedly turned down -- it's most likely because the G-men didn't want Facebook to have it. Google's business is less dependent on the vagaries of youth, it has money to burn, and it would be more than happy to watch Facebook grow old and irrelevant.

Dot com and carry on

Amid these -- ahem-- minor details, Evan Spiegel has become more famous for walking away from an easy $3 billion than he would have been for taking the money and running.

Of course, it's not like the man is standing next to a freeway on-ramp holding up a sign that says "will monetize user data for food." Spiegel grew up a spoiled rich kid in Los Angeles and dropped out of Stanford. Also like seemingly every other spoiled rich kid who dropped out of Stanford, he went into the apps business. Even if Snapchat disappears as quickly as one of its NC17 photos, he'll be just fine.

Remember the dot-com boom? Well, it's back. Raw unadulterated speculation fueled by irrational exuberance and a gambler's addiction to endorphins -- what could possibly go wrong?

You get to a certain age and you start to wonder, Did the ancient Romans know their society was about to collapse, or were they too busy watching grown men in skirts waving swords at each other? Did 18th-century French aristocrats watch the peasants erecting guillotines and think, "Alors, that's an usually large machine for slicing baguettes, n'est-ce pas?" In October 1929, were Wall Street plutocrats lighting their cigars with $100 bills while chortling about how the good times never seem to end? That's what this feels like.

We've been down this road before. It has never ended well. Let me rephrase that: For a very, very small percentage of people, it does end well. The same is true of Ponzi schemes, pyramid scams, and collateralized bond obligations. Get in first and fast, and you can cash out; the rest of us get to watch helplessly as the economy crumbles beneath our feet.

Where will you be when the last paper billionaire turns off the lights? Share your survival tips below or email me:

This article, "Snapchat to Facebook: $3 billion isn't cool. You know what's cool?," was originally published at Follow the crazy twists and turns of the tech industry with Robert X. Cringely's Notes from the Field blog, and subscribe to Cringely's Notes from the Underground newsletter.

Copyright © 2013 IDG Communications, Inc.

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