A few blogs back, I pointed out that Google is thriving because it is not based on advertising, it is a listing. Google lets viewers know about a good or service that is directly related to something they are interested in or searching for. That is not advertising which is a scatter shot of information at anyone in the target area of the shot. Listing is what you find on the wall of a building when you are looking for an office, or on a menu when you plan to eat or the outside of a coffee shop when you want a scone.
My point in this blog is that advertising only works in limited areas, with tourists who often lack a trustworthy source of recommendation and children who don’t understand the world at all.
Therefore businesses that survive only on advertising such as Facebook and Twitter have a long term problem surviving. Ad agencies believe in their product and believe that the vast array of information that is now available to Internet suppliers helps advertisers target their message to people who are likely customers. Which is not true. I see dozens of ads, daily, on Facebook and Twitter that have nothing to do with me. It is too much trouble to delete them, ignoring them is the preferred strategy.
The whole point of this blog is that businesses that depend on a reliable income stream and a desirable product like Netflix, Amazon and Google have a future. Others who live on advertising have the same future as newspapers.
This is not investment advice. I have pointed out elsewhere that all the tech companies are run by idiots (except Oracle) who give all their money to the anti-business Democrat Party at a time when they desperately need the support of a pro-businessman like Trump to thrive in the world of hostile foreign nations.