BEST OF THE WEB: How Russian billionaire Yuri Milner became a social media mogul

Yuri Milner is certainly one of the most fascinating figures to come out of the tech industry in the past few years. After appearing from virtually nowhere, he has now invested in some of the world’s biggest tech start-ups including Facebook and Twitter, possessing an ability to spot opportunities that few else can.

This new profile on Wired peers into Milner’s life and reveals a few untold secrets of the shy investor, who is said to be a short talker and rarely speaks for very long at one time.

He is an unusual addition to the tech scene. He hasn’t been a part of any start-ups, and hasn’t spent time in a garage building some sort of software product. Instead, he bought his way in.

“This is part of the discordant behaviour that makes him an anomaly, if not a sore thumb, in his new Los Altos Hills neighbourhood,” Michael Wolff writes. “Silicon Valley, despite being at the centre of the digital world, is a hopelessly insular and actually rather hermetic place. Even its famous immigrant culture emphasises joining the SV way.”

Milner started Digital Sky Technologies, a venture fund that has now funded tech companies including Groupon, Facebook and Zynga to the tune of several hundred million dollars. The company has a plan to invest $US1 billion in tech companies overall. But DST became a way for Milner to buy his way in, Wolff writes. 

“For all its talk of innovation, it resists almost anyone who is not part of its mainstream. Before Milner, it was even difficult to buy your way in – money in the Valley, the best money, the money that gets the best deals, always has a certain pedigree. Even New York money, not to mention money from God knows where, is regarded as lesser and suspect.”

It’s fascinating on its own that Milner has been able to buy his way in, but also that he’s been able to identify some of the most successful opportunities around, including a massive investment in Facebook.

But Milner is also an unusual character in himself, often travelling the world – crossing continents within a week.

“Milner may be a kind of prototype for his idea of a global brain – certainly he has achieved some sort of “global being” status. Traveling alone, or often with his wife and daughters (ages six and four) and his mother-in-law, and keeping his Moscow office staffed 24/7, he seldom spends a consecutive week on one continent.”

This piece is a fascinating look at one of the tech sector’s most influential – and mysterious – characters.

Google thinks long-term with Google+

It’s been a few months now since Google launched its social networking site, and by all accounts it hasn’t been able to drum up much success. It has 40 million users, but the lack of excitement around the product has led many commentators to declare it dead in the water.

But Jon Evans argues on TechCrunch that this isn’t necessarily the case. In fact, he argues that Google has a great platform here to actually take on Facebook and dominate the sector, basing his premise on the fact that by this point, plenty of other Google products had already died.

“Think long-term. Google does. When Google initiatives flop, they’re usually pretty much dead within a month of arrival, a la Buzz or Wave. But when they get any traction, Google is excellent at pushing them uphill, bit by bit, year by year, with a relentless tide of data-driven iterations, all the way to the top of the mountain.”

“When Chrome launched, a lot of people (including me) were bemused: why a new browser? Weren’t Firefox, Opera, and Safari more than good enough? Now it’s on track to overtake Firefox, and maybe one day even IE.”

It’s an interesting point, and given the level of attention Google is placing on its social networking, well worth considering.

Has Wall Street overreacted to Netflix’s mistakes?

Netflix has had a horrible year. The company raised prices, splitting its DVD and streaming services, and lost 800,000 customers. Then it tried to fix that by creating a new company purely for DVD sales. That failed too, and was eventually abandoned.

This week, it announced its quarter results, and Wall Street wasn’t impressed. Shares dropped a massive 27% and since July, have fallen by nearly three quarters of their value. Plenty are wondering whether Netflix – a company that is reportedly considering an entry into the Australian market – is over.

But this piece on The Atlantic points out the reaction on Wall Street may have been over the top. Daniel Indiviglio argues that since Netflix announced its changes, nothing much has really altered the way Netflix does business.

“Really, the company has not experienced any fundamental change between July and September, when its stock fell from about $300 to near $75. Before that, investors knew that streaming was the future.”

“They also knew that it was an expensive undertaking. Netflix has proven both points: its streaming subscribers have outgrown its DVD-by-mail subscribers and appear to be more willing to stick around. Meanwhile, the current and coming profit declines are due mostly to the expense associated with the company’s streaming expansion and global growth.”

Netflix may be down, but it’s certainly not out yet.

What’s Apple doing with its lower prices?

Apple has never been a company to lower its prices. It’s always taken the approach that users will pay top dollar for quality products. But as the New York Times points out – this is changing.

Apple has recently started lowering prices for its producers. Earlier this year, it launched the iPad 2 at cheaper prices than the original iPad, and in the United States, the company is now selling its iPhone 4S for $US199 on a two year contact – cheaper than many of its competitors.

This is a huge change for the company. Its products are now available to most everyday consumers, and as this piece points out, it may be a sign of how the tech giant is doing business behind the scenes.

“By buying up manufacturing capacity ahead of time, Apple forces its competitors to scramble for the parts that are still available, raising costs for their products, analysts say. Apple is the biggest buyer of flash memory chips in the world, according to the research firm iSuppli.”

Now that lower priced competition is entering the market in the form of the Amazon Kindle at $US199 it remains to be seen whether Apple will lower its prices to compete. With Tim Cook now at the helm, will it take a different approach?