To be clear, this isn’t about finality or absolutes, and we should especially not think in that fashion in a field such as digital media and its technologies – a field that is forever transforming. We should, however, consider the subject of maturity in its relative sense, in comparison to points of reference: a time, a sector, a different pace, perspectives that always evolve.

Media, as a segment, has always been unique (and fortunate) in its public relations. After all, it’s perhaps the only sector that reports on itself. The challenge then is to sift through the noise and vested interest. To help us out, we can rely on the cold, disinterested financial markets.

Here’s what we have observed:

(1) There has been venture capital consolidation, leading to fewer individual points with bigger and possibly less adventurous pools to deploy.

(2) There is an increased emphasis on revenues and earnings (as distinct from pure potential and option value), accentuated by post-IPO flagship properties that have been penalized as the operation has not kept up with the optionality.

(3) A significant portion of M&A activity has consisted of smallish “acqui-hires“ that take out the upside of willing sellers before the startup has hit its theoretical stride.

(4) Cash accumulation by some of the largest competitors continues, and sometimes the cash is even sent back to shareholders through dividends or buybacks.

(5) Many of the sector leaders have underperformed relative to analyst growth expectations in the latest reporting period.

With this backdrop, a number of predictions are in order. Think of these as New Year’s forecasts if you like, considering the season, but more truly they’re observations for the visible future.

• With maturation in the underlying assets, look for maturation in the way these are funded. As we climb up from small and early venture equity to mid-stage to late-stage to growth equity, buyout finance, and even debt capital, look for all of these follow-on pieces to increase in prominence and traffic. Some of the sector linchpins are already tapping the bond markets and securing debt ratings, which reminds us that media was at one time a borrowing sector (when it was old enough).

• Look for greater business emphasis on volume, capabilities and capitalization. While it pays to be small, nimble, and agile – able to navigate sharp turns in periods of high volatility and find plenty of new openings into which to dive – when the terrain is calmer and the openings narrower, this value proposition can start to lose its charm. Look for dominance (if not survival) to overtake iteration as buzzword of choice in our vernacular.

• In the strategic community, look for M&A activity to take place based on the integration of disparate parts. We have already observed the confluence of media and commerce, of finance and technology, of media and finance, and obviously media and technology. Look for these combinations to continue and for strategic directions to be set on an increasingly integrated field, where the distinctions will be blurrier between retailer and media outlet, between hardware and software company, and, most notably, between information and money flows.

• In keeping with the motifs of size, capital and integration, look for hardware to assume a more central place in the imagination of founders and the strike zones of buyers and investors. In comparison to software, this realm is more capital intensive, longer cycled, and difficult to “pivot” – which is alright when the turbulence is diminished and the money is perhaps more patient.

• Lastly, look for traditional media to garner increased attention from new media. This sub-segment that was at one time the only segment had been of late forgotten. As the breathlessness for novelty subsides and competition for market share and revenue intensifies, traditional media will be revisited and its audience and communities recognized for untapped value.

There are two overarching themes in these assorted observations and the handful of forecasts presented: On one hand, convergence and overlap (of sectors as well as capital sources); and, on the other, a progression from an era that was arguably defined by its financial ventures to one that is more highly strategic in nature.

Seeing these parallel patterns from another angle still, we note a transition from the more or less speculative gambit to a market that is structured, calculated, and framed within a narrower band of potential outcomes. We are seeing, in short, that digital media is verging on adulthood at last.

Dan Ramsden is founder and partner at CoRise. He blogs at discourseandnotes.com; follow him on Twitter @d_ramsden.

Are all the modern devices and digital conveniences we have at our disposal — from the web and social media to smartphones and tablets — making us more distracted and less able to concentrate? And is this harming our ability to think and be creative, and therefore by extension harming society as a whole? It’s a question that rears its head from time to time. One of the latest expressions of this fear comes from Joe Kraus, a serial entrepreneur who is now a partner with Google Ventures and gave a presentation recently about his concerns, offering an alternative concept he calls “Slow Tech.” But is this really something that we need to be afraid of?

In his presentation, Kraus argues that the incessant demands of cellphones and social media, not to mention email and other forms of distraction, are making it difficult for us to connect with other people — including our families — and also endangering our ability to think about anything other than the next jolt of stimulation from the devices we have all around us, which he compares to the constant stimulus of a slot machine at a casino. As he describes it:

We are creating and encouraging a culture of distraction where we are increasingly disconnected from the people and events around us, and increasingly unable to engage in long-form thinking. People now feel anxious when their brains are unstimulated.

We are losing some very important things by doing this. We threaten the key ingredients behind creativity and insight by filling up all our ‘gap’ time with stimulation. And we inhibit real human connection when we prioritize our phones over the people right in front of us.

Is multi-tasking just a myth?

Kraus says he has an “unhealthy relationship” with his phone and is constantly pulling it out to check things, and that if he lets it, that behaviour “fills up those gaps in my day — some gaps of boredom, some of solitude.” The effect of all of this, he argues, is that we are increasingly distracted, and less able to pay attention to anything for a reasonable length of time, and this distraction is a “worsening condition.” We may think that we are getting things accomplished or multi-tasking, he says, but brain studies show that multi-tasking is a myth, and in reality we are just trying to do too many things at once and overloading our brain’s ability to concentrate.

The Google Ventures partner and former co-founder of Excite.com also quotes sociologist Dr. Sherry Turkle, to the effect that: “We are lonely but fearful of intimacy. Digital connections offer the illusion of companionship without the demands of friendship. We expect more from technology and less from each other.”
This explains the constant desire for virtual contact, Kraus says — and that contact gets in the way of real relationships.

Kraus is far from the only one to raise the warning flag about any of this: Turkle has written about how the internet doesn’t help form real relationships, but fosters a kind of fake intimacy. Nicholas Carr argues in his book The Shallows that the internet and social media are making us less intelligent — and less interesting — and are actually changing our brains in negative ways. Others have also written about how they are trying to minimize the distractions their phones provide in the way of notifications, and there are a host of apps to help you concentrate when you are using your computer.

I would be the first to agree that time without a phone or tablet is a valuable thing, and that it’s good to take long walks (or baths, the place where Archimedes famously discovered the law of hydrostatics) and think big thoughts. And I also wrestle — as Kraus does — with the desire to look at the phone during meals and other times when I am with my family. But is this really a social disaster waiting to happen? And is it changing us and our brains for the worse? I have my doubts about that, just as I have my doubts about Nick Carr’s argument that the internet is making us dumber and less interesting, or that Facebook or any other social network is making us lonely.

Distraction of all kinds can be good as well as bad

Is technology changing, and society along with it? Of course it is — but that doesn’t mean we are becoming worse in some way, or necessarily losing anything crucial. In fact, we are just as likely to be gaining as losing. When Carr made his argument about the distractions of the internet, I had just finished reading a piece that Paul Kedrosky wrote for The Edge collection, in which he argued that one of the things he liked best about the internet and social media was the way in which it bombarded him with random data and content — the way that molecules are bombarded with other particles during quantum research — and that this produced all sorts of wonderful combinations of ideas:

The democratization of connections, collisions and therefore thinking is historically unprecedented. We are the first generation to have the information equivalent of the Large Hadron Collider for ideas. And if that doesn’t change the way you think, nothing will.

Not everyone can consume (or make sense of) quite as many diverse information sources as Kedrosky can, but his point is a good one: the random information flow that we are bathed in when we are online or using social media and devices like smartphones can just as easily be a source of inspiration and creativity as a killer of those things. Why is looking out the window or going for a walk more conducive to reflection than browsing through a friend’s Tumblr stream? I am not against walks or daydreaming — but there are plenty of ways to daydream and think big thoughts, and the shower or the hiking trail is not the only place that happens.

Is there a need for moderation when it comes to phones or the internet or social media? Of course there is, and social norms are developing around those things, just as they developed around the horseless carriage and the telephone and plenty of other modern inventions. One of the devices that has historically drawn the most criticism from scholars and theologians for its corrupting effect on humanity seems to have worked out pretty well — it’s called the book. If we can figure that out, I’m sure we can figure out how to handle cellphones and status updates.

Operative: Manu Warikoo has been promoted to lead the company’s product strategy and R&D roadmap as chief product officer. He was previously SVP of solutions, where he worked on product strategy and services. Prior to joining Operative, Warikoo co-founded search-driven research firm FirstRain. In April, former Incentone COO Francois DeCourtivron signed on as CFO of Operative.

Rubicon Project: Former Ticketmaster CTO Brian Pike joins as CTO of the company. Former Ticketmaster Deputy General Counsel Victoria von Szeliski also joins as general counsel and former Yahoo Product Management VP joins as SVP of product management. Von Szeliski had previously served in senior positions with Obama for America and the Democratic National Committee.

Texas Tribune: Ricochet Labs Co-Founder and President Rodney Gibbs has been appointed chief innovation officer. At Ricochet, Gibbs led the development of news quiz app QRANK. Prior to that, he was founder and director of Fizz Factor Studios.

AdSafe Media: Kiril Tsemekhman has signed on as SVP and chief data officer. He previously was CTO and chief scientist at Red Aril (later acquired by iCrossing/Hearst), where he focused on audience analytics. Tsemekhman’s twin brother, Vadim Tsemekhman, recently joined AdSafe Media as senior director of product management.

GumGum: The in-image ad platform has a new sales head: Robert Elder is now SVP of sales. He joins from Independent Television Networks (ITN) where he was VP of digital sales.

Exponential Interactive: Sandy Shanman joins as GM of mobile for the digital advertising company. He’ll run  Appsnack, the new in-app advertising division. Most recently, Shanman was SVP of mobile solution sales, strategy and business development at Limelight Networks.

The debate over whether we are in a technology bubble — and if so, what kind of bubble it might be — flared up again over the weekend, sparked by a piece in the New York Times that said venture-capital investors are encouraging startups to forego revenue so they can fetch higher valuations. Others immediately took issue with this idea, however, saying there is no bubble and repeated attempts to find one are just an attempt to stir up controversy. So which is it? That depends a lot on what you mean by the term “bubble.” Does it mean the kind of investment mania that resulted in a public-market bloodbath a decade ago, or just any sign of over-valuation?

Bits writer Nick Bilton says in his NYT piece that venture investors are all busy denying that there is a bubble, despite the mounting evidence to the contrary, because they have an obvious vested interest in perpetuating a hype-filled investment atmosphere:

Acknowledging any possibility that tech companies aren’t worth what you say they are worth would be followed by the sound of a giant pop, and the money and investments would dry up. The machine could grind to a halt.

In fact, says Bilton, venture capitalists are busy inflating the bubble as quickly as they can by telling the companies they invest in to avoid making money as long as possible. Why would they do this? So that valuing the enterprise is as difficult as possible and investors can then propose all kinds of inflated numbers, something financial analyst and venture investor Paul Kedrosky calls “mark-to-mystery” financing. “As long as there are no numbers, I can have whatever mark I want for an external valuation,” he says.

Is this just 1999 all over again?

Bilton also quotes Jeffrey Pfeffer, a professor at Stanford’s Graduate School of Business, as saying what we are seeing in Silicon Valley right now is “1999 all over again — but this time, it’s gotten worse.” The professor adds that companies are “throwing around funny money” and that the “economic values don’t add up.” Technology veteran Dave Winer also says he believes the market is fundamentally bubble-oriented at the moment.

It’s not clear what Pfeffer is referring to exactly, but it’s not a stretch to think that he’s probably talking about deals like Facebook’s $1-billion purchase of Instagram, which sent shock waves through the startup scene. But is that the sign of an impending bubble? It might be if you assume that Facebook itself is overvalued, and therefore was able to pay a ridiculous sum of money for a small startup. The most obvious sign of whether Facebook is overvalued or not, of course, will come when the company starts publicly trading, and investors of all kinds get to weigh in on what they think of its future prospects.

Venture investors like Dave McClure of 500 Startups argue that Prof. Pfeffer is mistaken, and there are no signs of a 1999-style bubble in technology.

.@nickbilton there are FAR fewer crazy business models, lack of revenue, bullshit vapor ware startups these days than ever before.

—
Dave McClure (@davemcclure) April 29, 2012

If public stocks aren’t overvalued, is there a bubble?

And McClure is right in a sense: the kind of mania that the tech sector witnessed in the late 1990s, with unprofitable and even revenue-less startups going public at massively inflated valuations, has yet to manifest itself in today’s markets. You could argue that Zynga and Groupon and other companies are overvalued, but both have suffered share-price declines that show a substantial amount of skepticism — the kind of skepticism that was in very short supply in the late 1990s. Apart from Facebook, there are very few signs of any kind of mania for public technology stocks.

StockTwits co-founder and venture investor Howard Lindzon (see disclosure below) says that the only bubble that exists is in the over-supply of what he calls “wantrepreneurs” — people who are chasing the pot of gold at the end of the startup rainbow. That kind of impulse has likely been accelerated by stories like Instagram’s, but also by the ease with which startups can be built and grown in today’s digital world, thanks in part to “crowdfunding” platforms like Kickstarter and the availability of cheap computing services in the cloud, which have dramatically lowered the barriers to entry.

Even if there is a lack of public-stock mania, however, that’s not to say there aren’t still risks. If the flow of investment money at the angel and seed-stage level gets too large, it can inflate bubbles that can in turn help produce bubbles further down the spectrum — and if that pressure overflows into the public markets, it could start to look a lot more like the 1990s fairly quickly. But for the moment, whatever financing pressure there is seems to be concentrated at the smaller end of the market.

Bubbles, yes — but not a capital-B bubble

This is the conclusion that angel investor and entrepreneur Chris Dixon comes to in a smart post on the topic, in which he looked at the different elements of the bubble case. Public stock prices don’t really look overvalued at all, Dixon says, and one-off deals like the Facebook purchase of Instagram aren’t really compelling evidence either. And while there are signs of inflated valuations in certain parts of the ecosystem such as the seed stage, he says — driven by people trying to find the next Facebook, etc. — there are signs of undervaluation in other parts, including at the Series A level.

One of the parts in the New York Times story that got the most reaction from venture investors — apart from just the general suggestion that they are inflating a bubble — was the accusation that “[M]ost venture capitalists… are not interested in building viable long-term businesses. Rather, they’re interested in pumping up enough hype and valuation to find a quick exit through an acquisition at an eye-popping premium.” Some critics said this is true by definition, since venture investors are interested primarily in short-term returns. But Dixon argues that even if it is true, smart investors don’t take that approach:

No good venture investors invest in companies with the primary strategy being to flip them. This isn’t because they are altruistic – it is because it is a bad strategy. You are much better off investing in companies that have a good chance to build a big business. This creates many more options including the option to sell the company. Acquisitions depend heavily on the whims of acquirers and no good venture investors bet on that.

So while some venture funds may be doing their best to inflate expectations and cash in on high valuations, that appears to be causing problems only at the small end of the startup pool — for now. Without any obvious signs of a public-stock mania that puts individual shareholders at risk, it’s hard to argue that we are in a 1990s-style bubble yet (although some critics fear that the new crowdfunding bill could accelerate the problem). Whether Facebook’s IPO triggers a broader inflationary atmosphere remains to be seen.

We’ll be talking with leaders in tech, media and investing about how to make the most of today’s opportunities, blurred lines and all, at paidContent 2012: At The Crossroads, May 23, at The TimesCenter in New York. Join us.

Disclosure: StockTwits is backed by True Ventures, a venture capital firm that is an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

Post and thumbnail images courtesy of Flickr users Photo Clinique and Bill S.