Have you heard of the Dead Internet Theory? It's the basic concept that much of what we see and hear on the internet is pure delusion.
Created to give the impression that there are vast quantities of people following every whim and idea of the great social media stars. When in reality many of those “followers” are mere bots, created to give the illusion of popularity.
In short that the internet is dead. It is no longer, real people interacting with real people. That it is merely a computer-generated illusion.
That the companies we're looking at this week, big tech, social media companies, have vast numbers of people watching and listening to every post, every Twitter.
Companies like Facebook, the granddaddy of them all, and Twitter, which was just purchased by a consortium assembled by Elon Musk. That they don't really command that kind of audience.
So much of what we see is not really there. And further, the sky-high values of these companies vastly over-state their real worth.
There are incidentally, several YouTube videos, of course, on the Dead Internet Theory. What irony, the best place to look for the Dead Internet Theory is social media.
And interesting that YouTube missed its earnings estimates last night. And the Google stock was sharply sold.
And herein lies the importance of the Dead Internet Theory. It is becoming increasingly difficult to determine just how hits, clicks, or users translate into revenue.
Take the case of YouTube, in reporting last night's revenue. It's a fairly easy thing to determine the number of views that YouTube receives each quarter.
But clearly by just watching the number of views, and projected clicks, Wall Street still overstated what they believed would be revenue this quarter by half a billion dollars. That's a greater than 7% overall miss. And a blow to projected Google growth.
Today we will get two social media companies reporting. In addition to Facebook, Pinterest will also report results. Providing the latest revenue figures for the company focused on photos, of beautiful homes and gardens.
But it's the bottom line that Wall Street is focused on. And with all the social media companies projecting future revenue has always been problematic.
And I would expect that the discretionary dollars used to support much of Social Media are getting harder and harder for people to come up with, now that we are locked in this interminable inflation.
So look for some pretty hard questions on these conference calls, as analysts try to nail down just what the projections are.
And want to make sure once again, that the social media platform visitors are real. And not just part of some Dead Internet.