Tuesday, July 01, 2014

$1 Billion Doesn't Go Very Far Anymore [UPDATED!]

There was a time when $1 billion meant something. For that kind of money you could get several really, really nice homes. Or a stable (or more) of luxury cars.

For a billion dollars you could own a fleet of McDonald's or Subway shops.

But if you want a working consumer website, $1 billion isn't enough
At launch time, TurningPoint found that less than a quarter of HealthCare.gov’s code had been tested.
The total tab for the dysfunctional website? A healthy $834 million, as of the end of February. This fiscal year, HHS projects to spend $1.4 billion on HealthCare.gov.

I'll admit, $1 billion sounds like a lot of money to me. It made me wonder how much the private sector spent on developing their websites.

Here ya go.

Facebook, which received its first investment in June 2004, operated for a full six years before surpassing the $500 million mark in June 2010. Twitter, created in 2006, managed to get by with only $360.17 million in total funding until a $400 million boost in 2011. Instagram ginned up just $57.5 million in funding before Facebook bought it for (a staggering) $1 billion last year. And LinkedIn and Spotify, meanwhile, have only raised, respectively, $200 million and $288 million.


For a billion dollars or so, the taxpayer could have owned 5 commercially successful websites.

Instead, we have a clunky site that still doesn't deliver as promised, and no one likes.

UPDATE [HGS]: One other feature that FaceBook, Twitter and LinkedIn share are deep commitments to security. And while not perfectly secure, they are at least accountable to their users. And, of course, we have choices: there's no law that forces us to use any of these services.

On the other hand, the ObamaTax forces us to buy health insurance, and folks who qualify for subsidies are forced to set up an account at the 404Care.gov site to use them.

Which, as FoIB Holly R tips us, may be a problem:

"A Romanian attacker hacked the Vermont health exchange’s development server last December, gaining access at least 15 times and going undetected for a month ... CGI Group, the tech firm hired to build Vermont Health Connect, described the risk as “high” in a report about the attack."

Now, where have we heard about this CGI outfit before? Oh, yeah.

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