But I beg to differ. This view of technology as something to be treated by distinct rules and norms is entirely wrong. In the 1980s I bought my vinyl records in HMV and Woolworths; I shopped in M&S and C&A and worked part-time in a bookshop; I queued for concert and train tickets; I carried guidebooks and maps whenever I travelled. My relationship with all of these has fundamentally changed in the same way as my connection with Sony.
Companies live and die according to how much utility and delight they provide. Sony’s problem was nothing to do with technology – it just didn’t execute on its opportunities when it had me (and many others) as a potential customer for life. It left a door wide open for rivals to delight my love of music.
Baillie Gifford used to have a technology sector group. I was given responsibility for it when it was set up in 2003. I was pleased with this accolade – I had seven years’ experience and was being asked to curate our approach to this huge sector. We have come a long way since then. That group no longer exists. And, for me, neither does technology as a sector.
I see technology businesses as companies that change the way we live and work. From the printing press to the mobile phone, mankind has sought to improve communication. And there’s nothing new in investment terms in great hopes being placed on ‘technology’ shares – railroads, automobiles, radio, analogue photography, video recorders, wearable devices have all seen explosive growth, capital chasing returns, boom and busts with spectacular winners and bankrupt losers.
The point here is that we should not view ‘technology’ shares as anything particularly new. Indeed, I feel strongly that we should also not view them as different – they are subject to the same inexorable rules of economics and competition as any other segment.
It’s what I term the internet paradox – by being an enabling technology, it has created the confusing situation in which everything and nothing is ‘tech’. Technology is what powers companies. Our job is to pick the winners.