Throwing Sheep’s Great, But…

NEW YORK — The headlines are ominous these days. Banks are collapsing, the climate’s growing dangerously volatile, and ahead of one of the most consequential presidential elections in decades, the media are giving us talking points about pigs and lipstick and moose stew.

Amid this backdrop, and in the spirit of finding opportunity in challenge, Tim O’Reilly, founder and CEO of O’Reilly Media, had a simple message for an audience here at the Web 2.0 and Interop confabs: Do something that matters.

“It’s not just about figuring about how to dip into the great money river of venture capital,” O’Reilly said. “We’re going to figure out how to make a better world using the power of the Web.”

O’Reilly, whose media outfit organized the Web 2.0 Expo, highlighted the recent crush of advertising-driven social media applications that have been gobbling up VC dollars and attracting some of the top developer talent. Naming some of the great problems of our age, O’Reilly highlighted a disconnect that one could see as very funny or very sad, depending on the mood.

In a country beset by “dysfunctional government,” “exotic diseases” and “the worst income inequality since the Gilded Age,” O’Reilly rhetorically asked, “What are our best and brightest working on?”

He paused, and a slide appeared on the jumbo screen of the Facebook app, “Throw Sheep at Your Friends.”

Sprinkles of laughter peeled through the crowd, but O’Reilly was serious.

Surveying the glut of lightweight, ad-supported consumer-facing applications created by many of the companies that fill the exhibit hall at this conference, it’s hard not to question whether we’re standing inside of another bubble, O’Reilly said. He was, of course, invoking the famous collapse of the dot-com bubble in 2000, and the recent implosion of the mortgage and credit markets, which followed the collapse of the real estate bubble.

“Create more value than you capture,” he cautioned. “There’s been this attitude of ‘let’s take more out of the system than you put in.’ These Wall Street firms captured a whole lot more value than they were creating. That has come home to roost.”

In a keynote that at times grew heady with allusions (toward the end of his address, O’Reilly read from a Rainer Maria Rilke poem), O’Reilly sought to modernize Pascal’s Wager, channeling the 17th century French philosopher and mathematician Blaise Pascal.

In the famous ‘wager,’ originally conceived as a somewhat cynical justification for religious faith, Pascal reasoned that it was wiser to believe in God than not. If the believer were wrong, at worst he would live a good life and die contentedly, even if nothing was waiting for him after.

But in living a faithless life, the nonbeliever would not only abandon the ethical moorings of religious teaching, but also reserve for himself the eternal torments that the church claimed await the atheist after death. So, Pascal concluded, it is a better bet to believe in God than not.

A little dramatic for a Web 2.0 keynote? Not for O’Reilly, who found his parallel in the debate over the severity of an issue such as climate change. What would happen if it were not as serious as Al Gore claims, but we nonetheless dove full-bore into developing green technologies and exporting them to other countries as a way to shore up (or recapture) America’s position as the world’s preeminent economic power?

At worst, he argued, the quality of the environment would improve and the thrust for green innovation would become a powerful engine of economic growth, even if the predictions were more dire than true.

But if Al Gore and company were right, and we ignored the warnings? For O’Reilly, it’s a no-brainer.

His message was an appeal for entrepreneurial service. Tech companies can tackle extremely ambitious problems, and make a pile of money in the process. When a youthful Microsoft announced its goal of putting a PC on every desk in the 1980s, the captains of industry dismissed the personal computer as a toy. When Google founders Sergey Brin and Larry Page declared their goal of indexing all the world’s information, skeptics laughed and said it was impossible to make money from search.

Ten years later, Google has made more money from the Web than anyone, but it also operates a robust philanthropic arm,, O’Reilly pointed out. Just yesterday, Google announced a partnership with General Electric to develop clean energy.

Green IT, mobile applications for telemedicine, gene-mapping projects such as 23andMe (it’s not just a rich person’s toy, O’Reilly claimed) — these are all areas where Web 2.0 applications can make a difference while making a profit in the process.

“One of the most robust strategies” for entrepreneurs and developers, O’Reilly said, is to “work on stuff that matters.”

“If you’ve trying to ride the wave” of fast VC money poured into tech fads, “you could just as easily be caught out.”

As a parting shot, O’Reilly was blunt: “Do stuff that needs to be done”

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