In the early days of the internet boom the hot ideas were search, online directories and online communities that were web based or that existed in a more underground or peer to peer environment.

Searching, exploring and sharing were what it was all about. The first killer app was not an ecommerce site.

The web enabled one thing in particular that really got young people in the Bay Area (and elsewhere) excited. It removed the barriers between creator and consumer. So who exactly was excited? Software developers who could think up an idea one month and potentially have the manisfestation of that idea out there and being used by a few million people a couple months later; writers and artists who could share their work and enjoy the recognition they could earn in the new meritocracy; and yes, people who imagined new ways of doing business on the internet and who wanted to get out here and be first to market.

In the middle of the boom, the story of the internet (and in many ways, its participants – especially those who envisioned it as a gold rush as opposed to a renaissance) shifted a bit. Ideas were being driven by MBAs and VCs. People started trying to use the web to change terrestrial behavior. If some things were better online, then why not everything? That brought us the false impressions about consumer need (Pets.com) and about what made sense in terms of business models (Webvan, Kozmo) and gave a lot of people irritating and upsetting delusions of grandeur and an inflated self-worth (electablog, davenetics, nextdraft…).

Money changed a lot of things. It made the boom era dot com parties a whole lot more extravagant. But for many of the creative entrepreneurs of the era (especially those attracted to the web pre-boom), even these parties were just a place to share the excitement of the medium, not the money, with others who shared their passion. This missing part of the story when it comes to the dot com parties was that many of the folks who attended went back to their offices right afterwards and got back to the keyboard.

Today, we see a re-emergence of the start-up market. The valuations are a lot lower than they were during the boom and companies are required to show a lot more traction before earning a second round. What’s also been interesting is the emergence of the smaller, self-funded or even unfunded start-up. These companies or products emerged by necessity during the bust. They also brought up an interesting question:

During the boom, what exactly were those hundreds of employees per company doing all day?

In a strange way, innovation in the areas where the web excels slowed down during the boom because so much of the web’s direction was being driven by the folks with the cash. And we know most of them didn’t know anything about the web. How? Because when the market went bad, they pulled out of just about everything. In any other industry, a bust is seen as a buying opportunity for the smart money. Think of a business like real estate. I know old school developers who start drooling during downturns. They trust that they can tell the difference between value that is actual and value that is a perception driven by market valuations. The market drops, these guys buy. There wasn’t much smart money during the VC internet boom because almost no one stayed aggressive during the slide. People were investing in markets, not products. When those next rounds of financing came into question, the running of the bears began and nearly everyone joined in.

So where are we now? Is the boom back? No way. Not like it was. The traffic in the Bay Area is still light. So who is driving the innovation and the resurgence?

I think, to a certain extent, it’s being driven by the same people (and a few younger ones) who were driving innovation before the boom. What was exciting then is exciting now. Personal publishing: Blogs have never been bigger and now the same guy who brought us Blogger is building a site where users can create and distributing audio recordings (Podcasts). Search is the core of the internet. User created content is as hot as ever. Directories are back, only now they are being managed by the community (tags). And new but similar social networks (the next generation eGroups and The Well) are coming back strong (Flickr, Delicious, MySpace, 43 Things, and on and on).

Janice Fraser sees Spring of 2005 as a innovation milestone in internet history:

Something is happening right now, and the developer community has an electric gleam in its eye. Curious, inventive people are making cool stuff again. There’s been a notable shift, and it’s incredibly exciting…

If you’re not yet amazed, inspired, and a little anxious, you might want to consider it. Then get a good night’s sleep and perhaps take a rejuvenating vacation. We’re going to look back at Spring 2005 as a milestone. Watch closely, ladies and gentlemen. Things are about to change in a very big way.

Jason Kottke counters that innovation was around during the bust and that the new money coming in may actually slow things down:

Now that the money is back, the focus will necessarily shift even though, as Janice notes, we’ll be a little wiser about it this time around. There will be less innovation and activity from individuals because they’ll be snapped up by companies to work on their projects for their customers. The information flowing out of companies, even those that are pretty open, will be limited because of competitive and legal concerns. A person who — when she was unemployed 3 years ago — could spend a couple weeks in releasing a neat web app for anyone to use because she wanted to or could say what she wanted on her blog will now be putting all her coding energies into an application that serves a few customers & needs to be cash-flow positive and won’t have the time to post anything to her blog (and can’t say much about what she’s working on anyway unless all her readers want to sign NDAs). (Not saying this is bad…this is just what companies are for. But what’s good for companies, their shareholders, and their customers isn’t necessarily what’s good for environment those companies inhabit. On the other hand, everyone I know has more work than they know what to do with and that’s a good thing too.)

I come at this debate from a rather unique perspective. I am on one hand an investor in internet start-ups and on the other a web nerd who uses the product like crazy to blog, share content, and develop new products. Nothing about the web has ever excited me as much as the idea that I can push a button and suddenly you can be reading this content (a Kozmo bike messenger showing up at my door at midnight with a box of high carb junk food in one hand and a brown paper bag full of adult dvds in the other coming in a close second).

What is key about the current chapter of the story is that these two parts of my brain – geek and investor – are no longer as distinct as they were. Web entrepreneurs have gone back to using the web for what its good for as opposed to trying to use it to simply replace everything offline.

I have seen the two parts of my web life, investor and geek, merge over the past several months. I am as excited during a start-up pitch as I am during a meeting about a small, nerdy project I am working on just for the sake of it. And both meetings are keeping me up at night because, as always, I feel pretty damn jacked to have a front row seat for this ongoing revolution.

OK, first I want to tell you something. My wife and I happened to be watching the first few minutes of the Late Late Show with Craig Ferguson on Monday night. During his non-monologue, he talked about the fact that he wasn’t wearing a tie. Then he worked that into a story about a time when he was in Thailand and bought a tie at the airport and called his mom to say I just bought a tie in Thailand. She was shocked and asked if that was legal. This story was so corny and painful that Ferguson would’ve been booed off the stage if he were giving a toast at a Bar Mitzvah.

Now that you have this background information, read this review of the show.

It really helps explain why so many of us feel so alienated.

So now a Congressional panel is grilling NFL execs about their steroid policy which has been called tough but not perfect.

Is steroid abuse really the worst lesson that our kids might learn while watching the NFL? Might be time to call a reverse on this line of questioning. How about starting with the average life expectancy of a guy who plays several years in the NFL?

Ever stood on the sideline of an NFL game? I have. The speed and force with which these guys hit one another is truly remarkable. If the average person ran a basic sweep left in the NFL, their body would disintegrate upon contact.

I am an NFL addict. (Played football, love football, oh, and sort of sucked at football.) I am so into the NFL that I will watch the entire Congressional proceeding on CSpan just to get my off-season fix. So I don’t want to sound preachy here. But this is a game that is all about rage and violence. We are all sitting in front of the tube waiting for that perfect crushing and violent blow. And if we don’t get it there, we flip on the Playstation and direct animated versions of our favorite players to crash into each other.

Should players take steroids? Of course not. But pretending that the biggest health problem facing NFL players is roids is like holding hearings on the sport of Boxing to determine if the corner stools are ergonomically correct.

In sports, the old adage is that defense win championships.

The same cannot be said in politics where a defensive posture merely promises of a greater need to play defense in the future.

So why are the Dems looking to deal on this filibuster nonsense?

Senate Democratic leader Harry Reid had been quietly talking with Frist about confirming at least two of Bush’s blocked nominees from Michigan in exchange for withdrawing a third nominee. This would have been part of a compromise that would have the GOP back away from a showdown over changing Senate rules to prevent Democrats from using the filibuster to block Bush’s nominees.

Americans are widely and wildly opposed to the so-called nuclear option.

So why cede ground? Why not make the GOP hubris an issue? Why not reframe the whole thing and go on the offensive when the public is behind you?

Update: Other smart folks have argued that this was a genius move and that Frist fell into a trap set by Reid. I hope so. But what if Frist had bitten?

NBC News tells the story of a chase a couple months ago when U.S. troops nearly got Abu Musab al-Zarqawi in Iraq. Zarqawi was forced to jump from a moving car. His driver was captured. So was his laptop which contained valuable intelligence including photos.

Photos released by the military last month were taken from the ‘My Pictures’ folder of that laptop, the source said. It was also full of telephone numbers.

Maybe they need to allow a little more adult content among the Islamists. I’ve never met an American dude who would hide his secret pictures in a folder called My Pictures.