Radar

Speculative bubbles, and the investors that fuel them, always appear ludicrous in retrospect. This is especially true of the dotcom frenzy of the late 1990s, which saw the coming and going of countless coveted internet prom queens. Today it seems scarcely credible that Netscape, now the favoured search engine of less than 1% of internet users, was purchased by AOL for €2.4bn in 1998 and that it was used for 86% of internet searches at the time.

And yet while fallen idols slip into neglected middle age, the young pretenders continue to be feted and fought over. Last year it was YouTube, purchased by Google for €2.1bn. This year it is Facebook – after a silent bidding war with Google, Microsoft recently bought a 1.6% stake in the young company for €170m, valuing the whole outfit at an astonishing €10.6bn.

For all YouTube and Facebook's undeniable charms, one does not have to look back to the grainy photos of the class of 1998 to see that such inflated dowries are loaded with risk. A more recent favourite, Skype, has veered dramatically off the rails since it was betrothed to eBay in 2005 for an initial €1.8bn, plus a schedule of subsequent payments tied to performance. Skype's service has since deteriorated and the anticipated growth has failed to materialise.

The beauty of internet newcomers can be shallow and transient. This lesson has clearly not yet been learned by otherwise right-thinking entrepreneurs.

How to

Ambitious entrepreneurs looking to the east increasingly find their gaze settling on China, the world's fastest growing market. And yet Japan remains the world's second-largest national economy and, for those prepared to follow some basic rules, an exciting and lucrative place to do business.

In the spotlight

It is tenuous to describe Olli-Pekka Kallasvuo, a career employee of one of Europe's most respected international corporations, as an edgy, high-risk entrepreneur. Nonetheless, Nokia's €5.7bn acquisition of US company Navteq, the world's biggest digital mapmaker, in October has the appearance of a bold, career-defining gamble.

There is no doubt that personal navigation devices – which doubled in sales during 2006 and are expected to maintain this rate of growth for the next five years – are a lucrative market that Nokia is well positioned to dominate. What is less clear is that there is money to be made in the labour-intensive business of producing and updating the digital maps. Navteq has never turned a substantial profit. With Microsoft, Google and TomTom fighting to bring interactive mapping technology to the masses, it is conceivable that Nokia is fighting for share of a market that will never take off commercially.

Kallasvuo admits that Nokia got it wrong in the early 2000s when it invested heavily in its conviction that the internet and mobility would come seamlessly and profitably together. It was a miscalculation that contributed to Nokia's first real rough patch and damaged its previously unblemished reputation. Nokia would no doubt survive a second failure; Kallasvuo probably would not.

Jones's view

Some drains flow both ways. Since the 1950s talented people have been fleeing Europe to seek better careers, higher salaries and more recognition in America and Canada. The Royal Society in Britain called it 'The Brain Drain'. Now the EU is hoping to replace those skills by sucking in the best talent from Africa, Asia and beyond though its proposed Blue Card scheme.

There's been much handwringing about the effect the loss of those skills may have on developing economies. You see much less written about the benefits that migration bring – both to their home country as well as the one they settle in. Let's look at one global industry to find out how.

For some decades in this business, the top talent from developing countries has been drawn into the top European outfits. But that recruitment process was sporadic until the EC freed up labour movement, and when a test case in 1995 allowed individuals greater freedom of contract, the floodgates were open. Now the higher echelons of European concerns are recruiting more and more talent from an ever-expanding range of territories.

That process has widened the skills base and accelerated R&D. The imported professionals hone their skills in a more competitive environment. They then re-export those skills – as well as their earning power – to the benefit of their home countries. Far from causing jealously and resentment back home, the Émigrés' progress in the European market is celebrated and followed avidly in the 'feeder' economies.

There is some concern in Europe that the imports stifle the development of local executives. But it may equally be argued that the locals learn new skills and flair from their exposure to an international talent pool. And in any case that's a small price to pay for European operations achieving an unassailable reputation as the powerhouse of the global industry.

Michel Platini, the new head of UEFA, now wants to limit the number of overseas professionals. It's a retrograde step, not least because non-EU players already have to negotiate the work permit laws before joining a European club. And besides, the drain is working exclusively in the European clubs' favour. The only recent high-profile example of a top European leaving for a foreign territory has not, as David Beckham himself might admit, been an outstanding success.