Caribbean Dotcom Boom? Caribbean Social Networking? A Rebuttal

In keeping track of references to KnowProSE.com, I came across 'Look Who’s Betting on a Caribbean Dotcom Boom' despite the fact that they didn't actually link the site (or even link to the Caribbean Blog List). I read it with some amusement because there is a trend in Caribbean web entrepreneur circles to do exactly what the article was talking about. My thought on that is that the Caribbean web entrepreneur circles are too small... but I get ahead of myself.

The premise of 'DotCom boom' is, in and of itself, flawed. When the global DotCom boom hit, for every single success there were 300 failures. This ran into the DotCom bust - basically the boom was not lowered, it was dropped. Millions of dollars were spent on creating Internet presences - I know some companies paid that much simply for a web page with some snazzy flash because the Internet was popular. The Kool Aid being passed around was something that Georgetown, Guyana, became infamous for.

Subsidizing Growth

The article goes into internet penetration figures - something I reference quite a bit but maintain a pound of salt with which to swallow them. But the figures themselves do not reveal the actual issues in the context of the Caribbean. I raised one of the issues, again, when I posted about how the Caribbean Internet Forum 2008 requires a bank draft for registration. How can there be any sort of 'boom' when you can't have practical microtransactions? I see an email from the coordinator of that event; I'll check it after I write this.

Where the Internet truly boomed was with microtransactions. A simple thing such as Google Ads - which, in truth, must be a configuration nightmare at times - brings income to perhaps millions of users around the world - but a person in the Caribbean will likely have to have money sent to them to deposit in banks that will take... two weeks or longer to clear. That's not how one does business globally. That, on the information superhighway, is a fatality.

Microtransactions subsidize growth. eBay, in all of it's selling of obscure artifacts from virginity to Pez dispensers, allowed everyday people to make money while allowing them to not only subsidize their own bandwidth but to profit from it. The Caribbean, aside from the Bahamas, has not figured out that this is a necessary step. Other developing nations, such as China, do. Any gear-head knows that a small engine performs better if you recycle the exhaust to produce more horsepower - commonly known as turbocharging. Turbocharging development works in much the same way. As it is, the Internet remains a liability because banks within the region do not seem to think that accepting payments on the Internet is something that they could profit from. Instead, they profit from the interest on float from cheques/checks pulled from foreign banks.

You want to accelerate the Caribbean's use of the Internet? Hold a bank up at gunpoint and, instead of robbing them, demand that they give you the ability to receive funds. Seriously - don't do that, but the tone seems necessary.

Caribbean Social Networking

Caribbean specific Social Networking is the biggest mistake any serious web entrepreneur can make. Let me say that again: Caribbean specific Social Networking is the biggest mistake any serious web entrepreneur can make.

Now I will explain why.

Large social network sites make money off of people who use them. If you're going to create a social networking site, allowing access to people with disposable income makes sense. In case you haven't been looking around, my friendly entrepreneurs, the Caribbean doesn't have a very large middle class - or population, for that matter. Thinking inside the 'Caribbean Box', while all nice and warm and fuzzy, is - pardon me - foolish. If your goal, as an entrepreneur, is to make money (aside from the warm fuzzy 'adding value' stuff), guess who your market should be?

Anyone and everyone with an Internet connection. And maybe a lot of people who don't.

This isolationist sort of thinking is counterproductive on the Internet. I'm not sure where it comes from, but in the Caribbean it is not limited to the Internet. Outside of the Internet, there are practicalities that might need to be addressed, such as postage or taxes¹. On the Internet, dealing with social networking, these issues are not a big deal at this time. The Caribbean's entrepreneurs are only isolated because they want to be. As a bit of an entrepreneur myself, I can honestly say that almost 100% of my Internet related income comes from the global economy - not the accident of geography of my Internet connection.

If there is to be any sort of growth, one has to look at the bigger picture - and the bigger picture is much more lucrative.

And here's another thing: Social networking sites rise and fall. Never be impressed with a peaking business. Be impressed with the consistent business.

¹For example, no one can import cost-effective hybrid cars into Trinidad and Tobago right now because they say that the effective engine size is what they tax - thus a motor in combination with a small engine gets taxed very heavily as it is seen as the equivalent of a 6 cylinder. So much for the environment.