From Atoms (GM) to Bits (Bing)

It is an interesting juxtaposition to have GM file for bankruptcy the same day that Microsoft launches its new search engine bing.  It would be difficult to find a clearer illustration of how the shift from atoms to bits is transforming industries.  It is not just the recession that is causing a smaller demand for cars – the demand will never be the same.  Using the net, we can share cars more efficiently.  Video conferencing reduces the need to drive for business.  And streaming video (search for it on bing) may cut out a few trips to the movies.

Demand for search across the rapidly expanding world of bits on the other hand is exploding.  With Yahoo, Google and Microsoft there are at least three major players in the US alone investing heavily in search innovation.  Add to that a number of existing vertical search engines, such as indeed for jobs, and planned ones, like a travel search startup I recently heard about in the Valley, and you get a lot of private dollars being spent on the future.

Let’s hope that our (taxpayers’) additional $30 billion going into GM (on top of $20 billion already spent) will be used to actually achieve a smaller but successful new company.  That’s a tall order and I can’t help feeling that it might have been better to use that money to start one or two new car companies from scratch (that’s of course idle speculation because of political feasability).