Elevation’s McNamee: Microsoft and Google Won’t Be Able to Recreate Their Success

Elevation Partners‘ Roger McNamee — friend of Bono’s, the lead in the failed resurrection of Palm and a winner in the Facebook IPO to the tune of $1.5 billion — is known as a contrarian thinker. He did not disappoint in a keynote address yesterday at the San Diego Venture Group‘s annual summit.

His main theme? We’re seeing a new consumer and publisher centric generation that is app friendly now, but moving toward an open, “hypernet” HTML 5 world. Left behind are desktop oriented services “built to meet [the 1960s] needs of Intercontinental Missile systems.”

With the exception of Excel spread sheets, everything is consumer oriented now as we move toward tablets and mobile devices. And in this environment, complete with apps, “the Web is only half of the addressable market.”

“We are going from the World Wide Web to the World Wide Web + this mobile thing. We’ll add more columns to this and we’ll do this very soon,” he said. The immediate result if that If you are Microsoft and “half of your world goes away overnight, you are royally [swear word].”

It is a favorite Silicon Valley hobby to pick on Microsoft, of course, but it is not the only company in jeopardy in a mobile era. “All the Web winners have failed to profit from mobile,” said McNamee, citing Google, Cisco, Oracle, SAP and Intel. “Not even Facebook has made a graceful transition. Mobile is a different animal.”

Apple, on the other hand, has been extremely well-positioned by “hiding its technology” in a graceful interface, and likely will remain front and center. “Apple made a bet against the Web” by offering apps and the iTunes Store. “Apple hasn’t even hit its peak yet,” he said.

But there are new opportunities for differentiated content publishers that can go right to the people — ranging from The New York Times and Forbes (a key investment) to MoonAlice, his rock band that has 2 million downloads and “no one has ever heard of us. The next generation Web technology will favor publishers and consumers over middlemen,” he said.

The new hypernet experience also is positioned for direct sales of products, bypassing advertising altogether, he said, in a tacit endorsement of the new transaction marketing space. That’s not a CPM-based ad. That’s lead gen. And it has an order of magnitude 2-3x per unit more than CPM-based advertising.

This flies in the face of the current content business, “where value is engagement. The problem with the Google story is everything is read very quickly: 25-30 seconds. But with the emergence of apps and social media, you don’t need search anymore. Meanwhile, text-based apps on an iPad will keep a user for 2-5 minutes. You can monetize that.”

McNamee suggests that Google and Microsoft, in particular, are in a real strategic jam. But they have hordes of cash and will try to “buy a ton of stuff” to shift the model. However, it will ultimately be in vain, he says.

Another doomed company, per McNamee? PayPal. “No one wants to put their password in,” he said. Facebook will introduce Facebook Mobile Connect and bypass passwords. “I hope it comes soon. It will take a year or two to get there.”

For now, McNamee concedes we’re in an ad-driven, television-oriented market that is still “70 percent driven” by major news events like Spain, China and the election cycle. “The future will be more oriented towards who has your credit card info,” he said.