Charlie Munger (Warren Buffett's partner) has kept a long-running list of psychological tendencies that commonly affect people's judgment. There's one item on this list that he's termed "Availability-Misweighing Tendency." In a nutshell, it's an observation that people tend to overweigh extra-vivid evidence, which (necessarily) means under-weighing evidence that isn't so vivid.

In this case, the extra-vivid evidence is the Instagram acquisition. It's been analyzed, or at least covered, by every blog and news network I can think of. I'm sure it's clogging most of our Twitter feeds. I even have friends and relatives who know nothing about tech but want to talk about it. It doesn't get much more vivid than that. And even if it wasn't receiving so much coverage, a billion dollars is enough money to be vivid in-and-of itself.

The point is, if you're re-thinking your business strategy or personal goals based on this news, you should tread carefully. The remedy to overweighing extra-vivid evidence is to always make it a point to seek out other side of the story. So I agree with Mark when he encourages "all other companies to do the harder work of finding out what happens in the 99.9% case, which is what is often never written in the annals of the tech news media."