From the guys behind diapers.com: “We’re trying to build a brand,” says Bharara. “That’s hard to do when you’re just a search box on Google.” Make that impossible. And that is the one small thing they are right about.

Diapers.com is a “pre-revenue” start-up with $50+ million in VC money. Diapers deliver no margins. They make their margins on other baby stuff. The two founders own about 8% each of their company. Who knew it took that much money to build a diaper dispensary?  If I were a venture capitalist putting up that much dough I’d want a lion’s share too, but this is a bet that’s riskier than just about anything I’ve ever heard of before.

Online retail is in for a crash landing. If you don’t manufacture something original, you will have  no margins in a heart beat. Thanks to the power of search marketing, online retail has been experiencing a race to the bottom for a long time.

And THESE guys are blowing 8% a year on advertising an online retail business that sells a commodity who’s only differentiator is great service? That’s just NUTS! The only reason they still exist is because of the crazy venture capitalists!

Recently I met with a dozen senior IT folks.  Though I have known for a long time that major corporations restrict employee Internet access, I was surprised to hear how vehement these dedicated IT senior managers were about it. They cited three reasons:

1. Productivity (which they say is by far the most important)
2. Compliance, regulatory issues and concern over inappropriate messaging
3. Bandwidth usage (a distant third)

The question of productivity is nothing new. Telephones and “personal” calls or worse “personal long distance” calls caused the same productivity and cost concerns for companies in the mid 20th Century. Businesses had no ability to restrict access  so, in the absence of tech tools, they exerted professional discipline on their employees. It was expected that people would stay focused and stay off the phone on personal business. And, in some firms phone bills were spot checked after the fact. Unfamiliar long distance calls were questioned.

Compliance issues do hold a special concern, posting inappropriate content or corporate secrets to blogs, Twitter, Linkedin or Facebook is an issue. But the sharing of confidential information is nothing new. Inappropriate memos and insider trading have been with us forever and there are laws and consequences for such behavior.

So if bandwidth is not an issue, why are CIOs playing Kindergarten Cop?   Given other hugely important issues such as Security, shouldn’t CIOs be focusing more time on that and leave the issues of professionalism up to HR and management?

I was awe struck at how ineffective the CIOs were at restricting access to the Internet – people are simply using their mobile digital devices for Internet access – untraceable, available, personal. If ever there was a reason for HR to step in and set parameters for personal professional behavior, mobile access is it. Attempting to control employee Internet access is a total waste of precious CIO productivity.