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The Myth Of The Tech Slump 168

Posted by JonKatz
from the good-riddance-to-the-dotcom-era dept.
The latest media-transmitted meme about technology and the Net is that the tech world is in the midst of a slump. This is true only if you define technology's overall status by dotcom stock prices. If the dotcom era is really over, good riddance. Maybe we can forget about dog and cosmetic sites, venture capitalists, copyright and lawsuits for a bit. Some of the tech world's most interesting innovations -- from the Net and Web to mom and pop online retailing to countless individual web pages to file-sharing to Freenet to P2P programs, AI to gene mapping -- have been developed far from venture capital cash. (Read more).

The outside world has always viewed the Net in terms of its most simplistic extremes: First it was a hive of hackers, then the world headquarters of pornography, and more recently, the corporate pot of gold. The rise of the dotcom era gave birth to the notion of the Net as the locus of the new global economy. While there is some truth to that notion. the end of the dotcom era is spawning now the latest variety of hype: the Tech Slump.

If you define the purpose or utility of the Internet strictly in terms of business (which mainstream media do, when they're not obsessing on porn) -- new equipment orders, consumer spending on telephone data services, the exact state of the NASDAQ on any given day -- then there's inevitable bad news.

Nothing can mask the awful truth about tech spending, Business Week reported recently. "In recent days, networking-gear maker 3Com, PC maker Gateway, and chipmakers LSI Logic and Xilinx, and electronics retailer Circuit City all warned that earnings will fall shot of expectations, knocking their stocks down as much as 36 per cent. Then, on Dec. 5, Apple Computer Inc. dropped a bomb, saying that slower-than-expected PC sales will vaporize $600 million in fourth-quarter revenues from its original estimate of $1.6 billion." These unexpected turns, says Business Week, are certain to reverberate through techdom, forcing consolidations that will extend well beyond the already tottering dotcoms. "Unable to survive past the easy-money days," the magazine concluded, "a lot of companies, from niche e-tailers to the umpteenth optical-networking upstart, will simply vanish."

Corporate predators are buying up the stock of imploding dotcoms, selling them off at bargain rates. There are now no-frills "shut-down" parties in New York and San Francisco instead of lavish start-up fetes. The media is filled with reports of mounting tech layoffs and bankruptcies.

This is an era that won't be mourned by many. If ever there were an unholy marriage, it was the frenzied coupling of venture capitalists and dotcom entrepeneurs. It had to end sometime, and now is a good a time as any. The dotcom era distorted the purpose of technology and the promise of the Net, flooded the Net with intrusive scrutiny, legislation and information barriers, focusing some of the best tech minds on making useless junk and obscuring the beneficial possibilities of networked computing.

Bankers are finally demanding that the companies they lend to earn profits. That doesn't mean technology itself will collapse, or that the Net and Web are in for bleak or uninteresting times.

In fact, that's a foolish way to gauge the rise of fall of technology, the state of the Net, or the vitality of either. The network is growing by the day, all over the world. More than half of the U.S. population now has access to computers at home or work, making computing the fastest-growing technology in history, and companies like Ford, Delta and Intel are giving away computers as employee benefits. There is no significant social or cultural group, from blacks to Hispanics to the elderly, with the notable exception of the impoverished underclass, that isn't moving rapidly online. E-mail has become a universal personal and business communications tool. Hard pressed to function in the Corporate Republic, WalMart-driven world, hundreds of thousands of small retailers have moved online, re-creating mom and pop stores on the Web.

And search engines and ISPs have given many thousands of people free and customizable web pages, sparking a culture that is expressive and personalized, and which offers mind-boggling marketing opportunities.

Some of the most creative and significant evolutions in the recent life of the Net -- the early search engines, Napster, Linux, Gnutella, Freenet, instant messaging systems, the World Wide Web itself -- were developed far away from the cash or even the notice of the dotcommers and venture capitalists. The Net, in fact, was created in the first place mostly by non-profit researchers.

Its purpose, according to J.C.R. Licklider, the Defense Department official who commissioned the early research that led to the Net: "Creative, interactive communication ... a dynamic medium that can be contributed to and experimented with by all." Licklider hoped for an open, distributed, educational and intensely interactive medium, a vision shared by architects of the Net like Jonathan Postel and by millions of people online, including hackers, and many of the participants in the open source and free software movements. If the end of the dotcom era means getting back to work on those kinds of ideas, the the tech slump will be a boon.

One could argue that the last few years have actually been the least interesting, productive and satisfying period in the Net's brief history, as corporatists swarmed all over the network, spawning legions of lawsuits, curtailing the free flow of information as much as they could manage, lobbying for noxious new copyright laws, funding inefficient, ill-conceived companies and all kinds of technologies which skirt the line between useless and ubiquitous.

The real legacy of the dotcom era could be 800 numbers that are never answered, the help that's always promised but rarely comes. Plenty of the dotcoms seem of dubious value. Americans are in no particular rush to get their e-mail on the freeway rather than at work a half hour later, or to transform their TVs into personal programming networks. More than 95 per cent of all Americans don't even have broadband, and aren't likely to get it anytime soon. Is the Net era over because there is one place to buy dog food online, instead of two or three?

The history of technology is filled with periods of great adance and upheaval, followed by retrenchment and consolidation. We may be heading into one of the latter.

There's no evidence that business or retailing has failed on the Web, or has no future there. One day, some of us may live long enough to see Amazon turn a profit. Catalogue companies like LL Bean and Lands End are successfully incorporating e-shopping into their business plans. E-trading sites have revolutionized consumer trading and are making money. Sites focused on the liberation of sexual information and imagery are among the busiest and most profitable sectors of the Net, anything but declining. Open media sites like Napster or like this one, sites devoted to open source distribution of textbooks and reference materials, are thriving. Peer-to-peer decentralized information models like Gnutella and Freenet, while still primitive and intensely geeky and difficult, represent revolutionary software and communications advances.

Must we mourn the loss of etailers peddling make-up and fashion accessories? Gaming has become one of the most profitable forms of culture in the world. A report by PC Data this month announced that 35 per cent of home Net users plan to purchase console or PC games during this holiday season, and that gaming is no longer a male-dominated domain. For the first time, women comprise a majority of online gamers -- 50.4 per cent.

Perhaps then we could funnel some of the creative energy and money of the dotcom era back into the original ambitions of people like Licklider? Maybe interactive communities will get the attention they deserve in terms of attention, conception, price, ease-of-use, design and architecture?

There's no shortage of unfinished tasks that could benefit from some attention. The virtual community, an inspiring early idea of the Net, needs redesign and reconception. Technology, from the sales and support of computing to the writing of code, needs simplification, to be easier and more accessible to non-techs.

Online politics is a ripe idea, especially after this year. Can digital technology help people register and vote more easily and efficiently? Can it democratize fund-raising, energize volunteers, generate new kinds of candidates, even provide more meaningful ways of considering issues and voting?

At the same time, a host of new tech issues like gene mapping and AI, looming social issues that have gotten little attention from the general population, could use some understanding and discussion.

The first generation Internet belonged to the engineers, dreamers and military researchers. The second belongs to the Geeks and the Dotcommers, who battled one another, sometimes directly, sometimes not, for attention and primacy. It was the Microsoft Era, and it's over.

It isn't clear what the next era will be about, or what, precisely, will define it.

My prediction: computing will spur the creation of Open Societies, digital technologies being applied to open government, different models for doing business, a revamping of intellectual property and a breaking down of hierarchies, barriers between citizens and government, even some national boundaries.

The Net is almost ferociously anti-hierarchical. Online authority reflects online architecture -- it is so de-centralized that the idea of a central information control seems almost impossible. Many-to-many-models of communication means open participation in decision-making, from media to entertainment to business, for better or worse. As computing spread through different sectors of society -- politics, government, education -- so will varying degrees of openness.

If the best minds online return to some basic topics, themes and dreams, the Tech Slump won't be the nightmare Business Week imagines, but might turn out to be a Tech Salvation.

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The Myth of the Tech Slump

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  • There doesn't seem to be too many signs of impending technology recession where I'm sitting. Given that IBMs net income for Q4 in 2000 were up 28% over the previous year, that doesn't exactly sit with the tech doom and gloom. Even if you take the whole year 2000, IBM posted a 16% increase over 1999 despite all the muttering that 2000 was a slow year.

    Food for thought.

    Toby Haynes

  • by osterby (104420) on Tuesday January 18, 2000 @06:30AM (#1362643) Homepage

    The media are piling onto the tech slump story in the same way they piled on the boom story. It doesn't mean that either were particularly true.

    The dotcom companies that arose in the last few years were bloated and often nonsensical, but you didn't read too many articles critical of them before the NASDAQ took a dive.

    It just brings me back to the conclusion that very few members of the media have a real understanding about what's going on, which may be ironic if you consider that it's the Internet that will over time erode the power of the mass media. You'd think they'd be keenly interested.

  • by Halloween Jack (182035) on Tuesday January 18, 2000 @06:31AM (#1362644) Homepage
    If the slump in PC sales is due to the Great Unwashed Public's waking up to the fact that they don't need to replace their 800Mhz machine with a 1GHz+ machine, then bully for them. The hardware and software companies have sailed along very nicely for a while now by emphasizing unneeded features and raw power over usability, reliability, and overall quality. Perhaps now they'll worry about giving people products that they can and want to use, rather than obsessing over whether they should install rosewood or burled walnut paneling in the bathroom of their Gulfstream XIV.

  • If so, shouldn't he be getting a little credit here?
  • lots of them promptly go bust because they haven't the business sense they need - they understand the web, not business methods.

    I think you've gotten this nearly backwards. A lot of dotcommers graduated with business degrees (MBAs and undergrad degrees), many from places like Harvard and Stanford. It's safe to assume they know more about business methods than 99.99% of people out there. As for the dotcoms run by kids, which I suspect you talk about, those that get funding are pretty much run by the VCs, who again are people that have business degrees and are ostensibly experts in running businesses.

    What I think they didn't get was not how to run a business, but how to run a web business. This is an important distinction, because I would argue that very few people know how to run a web business -- and those people can't (or won't) articulate that knowledge. Bricks-and-mortar companies aren't leveraging their knowledge -- they're leveraging their bricks-and-mortar infrastructure. This, I would think, isn't the optimal way to run a web business; rather, it's a good way to take advantage of Internet efficiency.

    Once we figure out how to run a web business, it'll be a new economic age. But right now, we're just trying to fit the Internet into a slightly-post-industrial-age economy.
  • I don't really think the DotComs were as bad as many here think.

    (Dodges a few bricks)

    What happened? A lot of business types had the same thought - here is a new communication channel, a whole new environment where money hasn't been made. It's like Sid Meyer's Civilization, round 1! We have to expand! expand! expand! Let's make some settlers!

    They were able to convince the banks, and got the venture capital (based on "sucesses" like Yahoo!). Those "in the know" bought stock, then the media picked up on it, and everyone was buying stock - soon, you get dot-com billionares, which always makes a good story.

    Those commericals made you laugh, but you couldn't say who they were for five minutes later. What you did notice, and you mon and grandma noticed, was that most had a web address, and they needed a com-pu-ter to look up those addresses. The media, wanting to jump on the trend that was making them lots of money in advertising, followed suit. Soon, you couldn't watch Wheel of Fortune or the local news without seeing a URL.

    I've been into computers for over 15 years (about the time I had the skills to type on a keyboard), and I've been saying how good they are all that time - but it wasn't until the dotcoms came along that my mom, my aunt, and my grandma were all asking me how to use them, that my wife (the coordinator at the literacy office in Tulsa's library system) could say that computer literacy was an important component of literacy, and not be laughed down, but instead given more money to buy computers! She is now teaching folks who are just learning to read how to use a computer, and giving them the confidence they need to keep learning. (Please, no AOL jokes - these folks know the importance of spell check and editing).

    If it wasn't for those dotcoms shoving the idea of the internet into every person's mind, I would still be looking at ISDN for broadband, and I'd be making a trip a week to the local bank rather than banking online. All that media hype made traditional business offer their services online, which made it possible to upgrade the infrastructure to take the load. Universities and rich computer types can only go so far - you really need the public behind it to make universal, reliable broadband possible.

    Even SlashDot would be in trouble if it was two kids in their dorm room. The popularity of the site would be limited by their resources, instead of getting constant hardware upgrades funded by ad dollars.

    I think without the dotcoms, we would be about 5 years behind, surfing at 56K from home, because the guys at work can't justify internet connections. Of course, now that we're here, we can afford to eject some of the booster rockets. It will be an interesting future.

  • "The longest sustained period of growth the US economy has ever seen" also coincides with the internet/technology boom. How much did Clinton play a part in this? NONE. He just happened to be there.
  • is this the first sign that the Good Guys (tm) may actually win this thing? i mean, the dot com boom led to all these marketers and big corporations fixing our 'net to conform to a solid money-making model .. and so far, they have mostly failed. this is great. soon we may have this thing to ourselves again .. an internet dominated by people who are enthusiastic about whatever it is they're enthusiastic about, rather than companies who think they can make money off of enthusiastic people.

    well, whatever.

  • I don't think anyone can accuse Katz's articles of having too much substance - too much BS, too much hype, too many unexamined assumptions, too many cliches, but not too much substance!
  • Thank goodness he didn't have an office on Piedmont Road.

    Seriously, the person you describe is all too similar to Mark O. Barton and that is not good. I would post a link to the AJC, but that is a fee-based service so here is one [usatoday.com] to refresh your memory.

  • Amazon is a good example. They tried for shallow broad coverage. But they didn't actually carry much that I couldn't find at my local book stores (usually Cody's books or Other Change of Hobbit, but occasionally Barnes & Nobel). Whenever I tried for something unusual, they didn't have it. If it was hard to locate, they had no more success than the local stores did. And they also weren't any cheaper. Now it is true, I live in Oakland, CA, in the middle of the SF Bay Area, so I have better access to book stores than most. But Amazon was less good than my local stores.


    For contrast, Computer Literacy, (now, unfortunately, fathead) was better able to locate unusual computer books. Of course, the internet business was just an adjunct to their local stores (in silicon valley somewhere). But they provided in depth coverage of a specialty area. (They may still. I haven't tried them on anything difficult recently.) This is where an internet store should have an advantage. By giving in depth coverage to a narrow focus, it needs to draw customers from a large area (there aren't as many). Because of the internet, it can. But all too many stores tried for shallow and wide coverage. It's an easy extrapolation of what has worked for bricks and mortar. But they don't see that it doesn't provide much advantage. And it looses the advantage that the merchandise can be physically examined, and picked up now.



    Caution: Now approaching the (technological) singularity.

  • Too bad it took an AC post to say it, but I agree. Our professional standing has been cheapened for too long by dotcom "web developers" whose primary programming tool seems to be Front page Express for IE 4.0.
  • My gripe exactly.

    Unfortunately this slump is hitting skilled bare-metal HTML coders and the mental midgets using FPExpress equally hard.

    It's getting to the point where I'm seriously considering getting a job doing tech support. Eep!


    ----

  • Even if it is slowing, and the dotcoms are "drying up," I don't think it is dead yet. Let me tell a story.

    I have a friend who writes multi-tier applications. In VB. He doesn't know whether TCP/IP is something implemented (on a PC) in hardware or software. I wouldn't trust him to write a "hello world" program to save my life. He recently left a job making $65/hr for another making $85 an hour.

    But I digress. I realize some people are getting laid off as dotcoms go bust. They probably can't get jobs as easily as the Ted guy from the Monster.com commercial. But when untalented people can make $175,000/year and there exist businesses with money that can still hire untalented people for that much, I don't think the economy is quite that dead yet.

    It might just be time to go back to searching for a job instead of having them thrown at you.

  • Chances are better that consumerism (funny traditional media--WSJ in fact, today--is just cathing on/admitting to this) had more to do with the upswing in recent years than anything else. Thank corporatized mass culture for the upswing. Who's responsible for the rize of corporatized mass culture? Republicans for siding with corporations? Democrats for siding with media? Or companies for seeing the profit opportunities and jumping on it? World population growth makes many political theories about the economy difficult to swallow, too.
  • If the dotcom era is really over, good riddance.

    Amen. If I had to see one more petstore online I'd cringe.

    -
    -Be a man. Insult me without using an AC.

  • I saw a ridiculous statement in the media somewhere (I just can't find it, WSJ maybe?), that said something to the effect of - the internet needs commercialization to be successful, or useful - something to that effect. The web is, and will be, a great thing for the same reason that free software is. Those people who are eager to contribute to it because of their own personal desire. When I think of the "success" of the web I think of things like Project Gutenberg and SourceForge, not mypetfoodstore.com. Even without all the VC, there will always be a market for the service and soon. The service alone is enough to keep the web viable without any crass commercialization at all. I have to agree with Katz on this point, the media completely ignores the contributions of creative individuals to content, and seems to focus purely on the "business" aspects. As if the web needs that kind of justification !
  • Maybe we can forget about venture capitalists, copyright and lawsuits for a bit...

    Unfortunately, a downward slump usually means tech companies turn to lawsuits for profits instead of products.

    I find it funny that so many people blame the Microsoft suit for the current slump, while saying MS doesn't have a monopoly. The explosion of other lawsuits would have nothing to do with destroying innovation on the internet?

    We'll get out of the slump in four years, when quasipresident Bush gets kicked out.
  • Newspapers, discussion groups, finance, purchases.

    It just that 90% of the ideas were me-toos, not
    workable, or scams. I'm satisfied with the 10%
    that seem useful.
  • Yes any dork that took macro-econ knows that economy's are cyclical. Hence dumb-ass Clinton has absolutely nothing to do with the great times we have had from 94-Q1,00. And the next dumb-ass in office will have noting to do with an oncoming recession if there is one.
  • For the first time, women comprise a majority of online gamers -- 50.4 per cent.

    ....Say what? From whose ass was this number pulled? I certainly haven't experienced an equality in female gamers online. Unless BarbieQuest came out and nobody told me.

  • I think you're right, a correction was in order. In fact, it's great for my investing strategy right now because I am getting all of the high risk stocks (technology, and growth stocks) at great discounts. VerticalNet (VERT) is only $6 right now! Down a LOT from it's high of in the 100's. And, from what I've read about the company, they have a decent business plan, but they are a dot-com, so they've gotten slammed recently. I just wish I could buy a bunch of it, but I don't have that much money ;).

    To discuss more on the subject of the 'tech-slump', I think it's good. Those who didn't belong in the space are getting forced out. I for one, have never bought anything through E-Bay or Amazon. I'd rather have a look at those types of products up close to see what they've got. However, I have purchased computer supplies from specialized suppliers that are net only businesses because they cater to a specific audience (in my case, PC modification and enhancement). The net is made up of people searching for specific and detailed info, and 'net stores' where specific wares are sold. It is not there to sell books which take 3 days to arrive at your door, when you could just drive over to the local Barnes & Noble, read the first chapter, decide that you like it, and buy it that day.

  • I see alot of what happened as the collapse of a hype based economy. You could see it in all of the weird evaluations if the dotcoms. Of course, while it was going on, only the weirdos and specialists in FUD were saying that it couldn't last, that you couldn't walk on air. The rest of us knew we were in a "New Economy"(tm).

    This has been an education for many of us in Bubble Economics.

    That being said, there is the probability that we will get into another period that will complement the first, a period of an Anti-Bubble economy, the time of the Anti-Hype.

    This becomes its' own self fulfilling prophecy of doom and gloom. In fact it is its' own kind of "bubble", a pessimism bubble.

    It is difficult to maintain a detached perspective on this. After all, these are "only" our lives on the line. It is tempting to say "well , I know it can't last, but I'll see if I can cash in on this while the going is good" (when the times where good). And this is where many of us got caught.

    Hindsight is not perfect, but for many of us, it is close to 20/20.

  • My take on this very long winded article is that I can see that the market for my skills (Unix, oracle, C, C++, Java, Perl) has slowed considerably. Sure, I'll still be able to find a job somewhere, but programmers are taking huge pay cuts.

    There are more layoffs every week, so I expect that the glut of dot com programmers and H1-B's to take a lot of the juice out of rates.

    I'm not feeling sorry for myself, I'm just saying we are having a real economic slowdown and those among us who have to make a living will feel it. Those among us who are too young to remember what a recession is like and who have never seen a Bear stock market have a reality check in store. Check out the movie 'Roger and Me' from the video store.

  • The quote tech slump unquote is indeed a god-send to those of us who were getting weary of bogus technology hype that basically had most people totally snowed. Working at a defense contractor, I was seeing quite a lot of money wasted on COTS products that are slow, bug-ridden pieces of crap, promoted by cheesy marketing and gilded with the latest market buzzwords to the point of being nauseating. Amen to the shake-out. Let the fraudulent companies fall, hopefully now we are all a bit more savvy and will learn to be wary of cheaply built software that is being touted as nothing less than rocket science, not to mention the *ridiculous* price tags on some of the manure being sold by hyped up companies.
  • I'd like to see a survey on cyber sex. Just how many of those were REALLY women? This gives me some hope.
  • ... aqueducts. And it's safe to walk the streets at night (ok, so maybe not the last one).
  • If you Americans get into a recession, you can most likely blame your politicians who are definitely talking as though it is a fact. If enough of them say there is a recession, Mr & Mrs Joe Public will start to believe it, and act accordingly (spending less), and hey presto - a self-fulfilling prophecy.
  • A well configured, usable search utility for the net would have obviated much of the dot coms business flaws, e.g. the wealth of money that is silently channeled through VC to dot coms by the entertainment industry was secretly laundered by the media companies - they were vesting an interest in people not finding anything, weren't they? So, we had fallacies like 'online advertising' and 'media coverage of the internet' which amounted to nothing more or less than an annoyance at best. The era of zillion dollar domain names and dot com ads on tv is dead. And at a terrific, debilitating cost to the VC's that funded these now-bankrupt adventures. But I would like to add one thing: its not whether or not there is only one pet store, on the net. It's going to be whether or not there is 50 million pet stores on the net. The net is a natural extension of mans ability to communicate. Removing this natural, everyday capability from its current constraints of 'having to check your email in 30 minutes' at a 'desktop computer', and creating a world in which your internet information search and retrieve capability is by definition also a business space. We buy things with our cell phones. we research things with our cell phones, we are able to live better with the capability of being able to exchange data with one another, and retrieve it from wherever we are. Walk up to someone, in a world where if they are carrying a cellphone and a whisperpiece , assume have a click trail on you and see how much more profitable the 'liberators of sexual imagery' are than the ecommerce companies. The internet should not be totally anonymous, impersonal or divorced from humanity. Its isolated islands of commerce, and community will one day join. And ecommerce will take off when we can buy things will our cellphone. The 'privilege' of having a website, will be taken one day as a HUMAN RIGHT.
  • While there was little speculation of a down turn while things were great for all of the dot-coms, now there seems to be too much speculation as to how "bad" things will get. All of this guessing isn't something that should be reported as news. We saw this problem during the presidential election when people decided not to vote because news stations had already "predicted" (many times inaccurately) the winner of that state.

    It may be that the tech industry is still strong and that the NASDAQ is "down" because the price of dot-coms has been corrected. But if the media tells people a recession is on the way and people believe it, they'll sell stock for fear of what's to come (even if what's to come should only have been a market correction) and we might find ourselves in a recession anyway.

    But unless you believe the economy will never recover, a recession might bring about low stock prices which will be a nice investment for the long term.

  • This is extremely sound advice. As a hiring manager, I've found that you have to push hard on HR numb-nuts who ask you for lists of "keywords" to put in their ads. My standing rule is that no ad goes in unless I have personally written it, then reviewed the final copy. Any HR weenie that puts an ad in that was _not_ written and reviewed personally by me gets called on the carpet, along with his/her boss, and furthermore HR pays for the ad out of its operating budget, not out of my hiring budget.

    But a lot of hiring managers don't have (or don't realize that they have) this degree of power in the organization, so the HR drones rule. This means the ads have exciting and attention-getting titles like "Programmer III" and "Junior Support Engineer II", along with silly lists of keywords that someone might have barfed up in a spare moment, but never believed in their wildest dreams would actually find their way into print.

    So, this person is 100% right. Apply anyway. You'll probably find that the hiring manager is secretly appalled at how bad his/her ad looked. And, if s/he turns out to be a keyword bonebrain, you don't have to work there. But at least get the interview.
  • by AntiPasto (168263) on Tuesday January 18, 2000 @06:02AM (#1362673) Journal
    but definately an economic cycle. I'm perfectly happy with a recession. Just means another boom.

    ----

  • Sock-Puppet advertising. I have mine right here!
  • what i should have stated is that people keep on pointing to the state of the NASDAQ and the DOW as an indicator of the financial state of the world/country, where all it really is is a market correction.

    a crappy stock market does not necessitate a recession.

    better? :)
  • I was just thinking the same thing. He starts out with a great hook and then just rambles on, presumably just for the love of hearing himself talk.

    -Down with the moral majority.

  • How's come it took a(n apparent) furiner to first make this observation in this thread?

    GWB will keep thumping the recession drum until enough people buy into it for his tax cut to pass through Congress.

    He owes a lot of big bidnesses for that US$100million of campaign money he amassed in the last 2 years. The tax cut (proposed as retroactive!!) is just the repayment these Corporations and Big Bidnessmen are looking for - cold hard cash.

    Look for the scraps of the tax cut to be divided 100 million ways among us "normal" taxpayers. Too small to be noticable.

  • by Lumpy (12016) on Tuesday January 18, 2000 @06:04AM (#1362678) Homepage
    Exactly what innovations over the past 10 years were from dot.coms? everything I can think of came from grad-students and open projects or the big old companies that have been around forever.

    I cant think of one dot.com that made an impact other than a pile of burned, worthless, stock certificates.
  • I recommend Maestro by Woodward (who is, admiteddly, no Republican-lover), a sort-of biography of Greenspan over the past two decades. Reducing the budget deficit was initially Greenspan's push (at the time he considered it the only way to expand the economy any more, since things were already starting to do well). Clinton spent his political capital on it, though, which is certainly worth something. In fact, the only republican who supported his budget packet was Greenspan. Reducing the deficit probably had a much bigger impact than you give credit for.
  • What about the web browser?


    Sure, CERN has a working proof-of-concept, and Lynx was around, but the net wouldn't even have pictures if it wasn't for Mosaic, and little else if Mark Andresson et al hadn't got the venture capital and started Netscape.
  • Well, for one, I agree that tobacco lawsuits didn't make the deficit totally balanced, but it did help. That's why I included more than just that point. Putting it first was just coincidence. I'm 24 years old, BTW, and do not listen to AM radio. (Too many far left and far right idealists running around on AM). But a bunch of states and the Feds sueing the tobacco companies for hundreds upon hundreds of billions (I think it was $500 billion+, but could be wrong about that) of dollars does make a pretty big difference in the budget. And that certainly will make a difference when we don't have lawsuit settlements being used in the future to balance the federal budget.

    As for the arguement on war generating economic growth, while unfortunate, I think most economists will agree that a war that is won, will generate more money for the winners, and more poverty for the losers. Even Sun Tzu's writings indicate that winning a war involved having more resources and aqcuiring more resources than the opponent, where as tactics were more important for individual battles.

    It's unfortunate that I got modded down to 0 even though I've apparently gotten people talking on this subject. :(

  • clear that so far, 9 out of 10 new internet companies (the publicized ones, anyway), haven't failed.

    Well obviously. The publicized ones were publicized because because they were the ones that made it. How many "we're-the-next-big-portal" companies made it. How many of the attempts at online retail made it? How many web hosting companies do you think folded? I think the 9 out of 10 statistic is probably pretty relavant, even in regard to .com companies.

  • by TheReverand (95620) on Tuesday January 18, 2000 @06:10AM (#1362683) Homepage
    I can't think of any innovations at all. Sure, there were /enhancements/ and /realizations/, but all the real innovation happened already. Dot.coms weren't here for innovation, they were here to solidify the internet through business venture, and in that respect they suceeded. It is typical that in any new industry, 1 company will suceed for every 25 that fail. The dotcoms are no different.
  • It's an interesting point, but I might suggest that Jon isn't trying to ace any science techonology studies courses, and actually INTENDS to bring up open ended questions since the Slashdot forum allows these to be springboards for community discussion rather than just failed attepts to pad essays (something I'm rather familiar with)

    ;)

    - StaticLimit
  • I guess I can't think of actual innovations either, but there have definitely been some improvements. On-line shopping is nice for us mall-haters, especially being able to find things that you may not be able to find at the local mall. On-line entertainment can also be a nice time-waster (Slashdot, anyone?). Again, neither of these is really worthy of the "innovation" title though, IMHO. But they're nice.
  • It's my understanding that the events you call the '74 and '82 recessions are infact the same event that began with the 1973 oil embargo and ended with the turnaround under Reagan. Carter certianly didn't help the economy, did he?

    Bush's problem: he wasn't economically conservative enough; he buckled under.

  • FIRST POST! Wait - no what I meant to say is things like First Post being so common and such is a euphamism for why there is a 'tech slump.' People are no longer wow'd by IM (were you ever?) Email is common for grandma and damn near everyone has a computer. Remember planed obselecence? Why? Because if everyone buys their computer in '98 - it wont be till 2001 they wanna upgrade.
  • Considering the huge user-base of Ever Quest and Diablo .. and the fact that most women probably never let on as such online, cause who wants to get hit on by HNGs? (Horny net geeks)

    Anyhow, it wouldn't surprise me, and it shouldn't surprise me that you didn't know. I know some geeks that would consider a trade for a composite +6 bow as a proposition for courtship.
    If something has never been said/seen/heard before, best stop to think about why that is.
  • Not "absolutely untrue". Yes the market is unpredictable in the micro sense of the word, but, somewhat like the weather, you can look at trends and indicators to gage how the market will *probably* behave in a macro sense.

    I think the general consensus among those in the financial industry was that the tech was overvalued. The big question mark was *how* overvalued and when the correction would take place.

  • "GSM phones must be nearing saturation, in europe at least, and people are waiting for 3G to upgrade etc etc."

    Mobile phones in most of Europe are treated as fashion accessories. Most people seem to get a new one annually, just because it looks nicer, or plays more tunes, or something. Because they're bundled with contracts or sold as loss-leaders, they're affordable enough to treat in this way.

    As a result, demand for mobile phone hardware in europe is about as likely to reach saturation as the demand for trousers.
    --
  • I agree completely. Many of the companies that have seen there stock prices plunge may have had quarters that were below expectations, but it seems that the media overlooks the fact the companies are still making millions of dollars annually. IMHO that is a successful company, regardless of what the talking heads say. Funny that the dotcoms take the heat for the "slump" instead of the VCs who foolishly pumped millions of dollars into start-ups with no concept of a business plan.
  • Especially weird when people reply to messages they misunderstood. Nobody said Clinton was a republican. What world are you in?
    ________________
  • You must be joking. Have you missed the last half-decade of global expansion in free trade? Have you missed all that Clinton has said in favor of this? Have no missed the way Wall Street applauded his economic policies?

    The fact that some idiotic dot-coms are finally dying means nothing -- most new businesses die, some deservedly. That's capitalism in action. Cycles come and go (nothing rises forever).

    But if you think Clinton was in some way against global expansion there isn't much point in talking. Read. Learn.
    ________________

  • 10% gain in harware revenue, 5% gain in services, 1% loss in software, planning to spend $1b this year on Linux. I think IBM does understand the future. Software is necessary to run the hardware. It is expensive to produce, but the money is in being able to use it, not just having it. Oddly enough, it looks like IBM is strengthening its position by lowering the bar for competition, by commoditizing as far as possible, the hardware, software, and support. As this gets more complex and central to core business, vendor lock-in becomes unviable.
  • Hell, the '91 recession barely counted as a recession

    Which is why it was so ridiculous for Al Gore to be claiming that he and Clinton inherited the "worst economy in 50 years", or some such drivel.

  • by RayChuang (10181) on Tuesday January 18, 2000 @08:49AM (#1362696)
    Jon,

    I read with great interest your comments on the end of the "dot com" boom.

    I think what is now happening is the very fact that companies that have a "brick and mortar" presence will be the ones that will survive in the long run. Look at the fact that Wal-Mart, Toys-R-Us, Barnes & Noble, GE, Ford, FedEx, UPS, and other "Old Economy" companies have done an extremely successful job in leveraging their "brick and mortar" presence onto the Internet.

    In fact, a great example of this is Boeing and Airbus--both are heavily investing in intranet and extranet sites that make it possible to order and ship spare parts for Boeing and Airbus jet airliners almost anywhere in the world.

    However, some "New Economy" companies have done extremely provided the managers have a truly innovative ideas and have emphasized the need to actually make a profit. A good example of this is eBay--the company that has essentially created the world's largest classified ad and auction site. And the fact the founders of eBay have emphasized the need to make money have proved that they can withstand the failure of the "dot coms" out there. eBay has so well-implemented their business model that it's almost SOP for anyone who need to sell things in a hurry to a large audience to put it up for auction/sale on eBay first.
  • Katz really does suck... Hell, I can write a few paragraphs catering to slashdot demographic and be about as insightful as this trash.
    So why don't you get off your ass and do it? Like the old saying goes: Those who can do, those who can't become critics...
    --
    You think being a MIB is all voodoo mind control? You should see the paperwork!
  • The claim that we are entering a recession is based on a prediction of how a Bush would act in an economic slowdown, which we will have, and which we would have had no matter who was elected.


    This seems to me to be a problem with multiple causes. One of the major ones is that the out-going lice attempt to grab any last possible benefits, and the incoming ones attempt to grab anything that they can plausibly blame on their predecessors. One of the examples of this is the current power mess in California.


    The outgoing powerstructure has guaranteed the *** who ripped of the state during the "deregulation" of the power industry that their "theft" will be considered legal and untouchable. Notice that this was entirely done after a long period of Demo control over the appointments.


    Now it is true that the Republicans instigated the deregulation, and helped write the rules as to how it would be done, so they aren't blameless either. And it's also true that deregulating the power industry was inherently a monumentally stupid thing to do. The investment required to compete ensures that there will never be any reasonable amount of competition. However


    This particular action appears to me to have been carefully timed to occur during the change of office. I feel that it will have a massive adverse impact on the state's economy. But it was probably not done entirely from selfish motives. It is also true that the building of power plants in the state has been vastly complicated by regulations (adopted to protect the environment). One of the reasons that this mess is being allowed to occur is to enable those regulations to be eased so that more power plants can be built. I feel that it was scheduled so as to occur at the time when the largest amount of benefit could occur to many of the players. But it is also true that it would have happened eventually, possibly soon, in any case. By scheduling it now it becomes possible to create a fake emergency which can be lifted when the necessare degree of emergency is felt by the populace, and then the building can be started before the real emergency happens. It's also true that during the process a massive amount of money is being stolen (legally) from the citizens.


    I don't really know whether to praise them or condemn them. But it will have serious economic repercussions. Just not as bad as they might have been. I do know that I get angry, depressed, furious, hopeless, etc. But this doesn't mean that it isn't the best available solution to the problem. And it's interesting that it is being so scheduled that each party can blame the other. I don't know how many events like this are happening that I just don't know enough about to comment on. I do know that listening to news from outside the state I would have no hint as to what was actually happening. Even on the local news it isn't made very obvious. A lot of this is pieced together supposition. E.g., nobody is admitting that this is intentional. They couldn't. But it seems pretty obvious. It's only the motives that are obscure.


    Caution: Now approaching the (technological) singularity.

  • by Anonymous Coward
    To bad any analyst will tell you recessions follow the president that caused them by about 4 to 8 years... i.e. the president in little to nothing to do with the current ecomony unless he does something really foolish or something very large (world wide scale) happens, look at your history books
  • Bush could never have gotten NAFTA through a democrat-controlled congress. Democrats were, on the whole, against NAFTA. I credit the success of NAFTA not on some excellent negotiations on Bush's part, but instead on Clinton's ability to bring a fair number of democrats to support NAFTA, so that it could get through congress.

    I'm not quite sure what ou mean that "the only things that Clinton and the liberals in Canada were trying todo (sic) is screw nafta up by violating the agreement with illegal subsidies/protective restrictions/etc. for there (sic) respective backers unions/farmers/enviro-nazis". In case you didn't notice, Clinton did more to alienate the unions than any democrat in 3 generations (hence the support for Nader). The farmers, in case you didn't notice the results of the 2000 election, are conservative republicans. And I'm not quite sure what subsidies or restrictions were attempted vis-a-vis the environment.
  • The answer is simple: online shopping (with Amazon.com as the model) and online auctions (with eBay as a model).

    I think in the end, eBay will be remembered as the best company that represents what the "New Economy" can do. After all, their highly successful marketing campaign has convinced everyone that need to sell almost anything quickly to put it up for auction on eBay. Heck, it's become more than just an auction site, it's also become a major site for a lot of mom and pop firms to do business selling collectible items, too. I mean, Ty's Beanie Babies wouldn't be THAT popular if people couldn't sell or trade them over eBay....
  • by Chester K (145560) on Tuesday January 18, 2000 @09:00AM (#1362702) Homepage
    ....Say what? From whose ass was this number pulled? I certainly haven't experienced an equality in female gamers online. Unless BarbieQuest came out and nobody told me.

    This number does not only include what's mainly viewed as online games, such as Quake, UO, EQ, Diablo... it also counts Yahoo's online games of Hearts, and the various Jeopardy and Wheel of Fortune type games at The Station [station.com].

    Those are extremely dominated by women, who generally posses no tech skills other than knowing how to get their web browser into a game.

    That's where the high number of "women gamers" comes from.
  • Well said, especially the bit about the different waves of netizens. First come the scientists, then the geeks, then the .comers... and these days I get the feeling it's everyone and their grandmother.
    Reminds me of what Roberta Williams once said about why Sierra's King's Quest games weren't selling too well anymore - computers used to be prohibitively expensive so only higher-earning (and hence, somewhat above average intelligence) people could get one. More recently just about everyone can afford one, which is why games have become less subtle and more geared towards the lowest common denominator (viz the demise of Infocom-style text adventures and the abundance of 3D shooters).
  • Clinton did 2 great things for the US, at least the male population: 1. redefined what sex was 2. kept Congress so busy with his impeachment proceedings that they weren't able to pass any stupid laws.
  • you go away.
  • "For the first time, women comprise a majority of online gamers -- 50.4 per cent." Sorry but thats tied. Also, what perecentage of those female players are just playing bejeweled, yahoo hearts, etc? (Not that I dont play those but I sure as hell dont play them exclusively.) For you to tell me that more female gamers exist then male gamers would be to tell me shugashack.com doesnt exist!
  • ...will be a positive one, IMHO.

    The creative minds that were being used for commercial purposes might decide to do something for free.

  • And we all know that only women play amazons. Oh wait I better change the name of my amazon from SquadBoy to something else. I really should get around to just blocking Katz.
  • My prediction: computing will spur the creation of Open Societies, digital technologies being applied to open government, different models for doing business, a revamping of intellectual property and a breaking down of hierarchies, barriers between citizens and government, even some national boundaries.
  • by The Mayor (6048) on Tuesday January 18, 2000 @06:53AM (#1362710)
    Look, I'm a democrat. But I think you're forgetting the '78-'79 recession, coupled with double digit inflation and double digit unemployment. That recession made the other ones look mild by comparison.

    As for the others claiming the economy is cyclical, do they honestly believe Clinton had nothing to do with the longest sustained period of growth the US economy has ever seen? What about the delta in the budget deficit? I happen to believe this is a result of centrist fiscal policy (Clinton was anything but a liberal democrat). Reagan, Ford, Carter, and "w" are all towards the extreme (at list vis-a-vis the US political system). I wholly expect the economy to enter into a recession under "w".
    And now? 2% growth is not a recession. A recession is, by economists' definition, two successive quarters of negative growth. Hell, the '91 recession barely counted as a recession....
  • Consider the proper design of a control system for a complex device with multiple independant threads. And essentially no off-stream time for debugging. And a system design process which made it impossible (job-threatening) to admit than any bug had ever been present.


    I don't think that anyone is in possession of sufficient evidence to come to a conclusion as to what the proper control structure is, where the proper points of control are, or how the various feedback cycles interact. Turning this into an essentially religious issue (i.e., declaring by fiat that one view is true, without good evidence) seems foolish.


    One feasible possibile reason for the past economic boom is that the government was so stymied by political infighting, that they couldn't get anything unpredictable done. So companies were able to pland.


    One feasible possibility is that the cuts in non-economic government spending and rapid expansion of the internet (reduced friction in money flow, etc.) allowed the increase of effective money supply. And that this stimulated the economy.


    One possible explanation is that increased penetration of credit has allowed a large proportion of the population to spend money faster than they have earned it. If so, this must draw to a close at some point. Probably quite gruesomely.


    These are probably all true to some extent, and interact in complex ways. To claim that the economy is cyclic is not to claim that it's periodic. Even the claim of a cyclic nature should be viewed sceptically. How much is just a game of labels? But the claim that it is periodic is clearly wrong, and very few make it explicitly. Certainly nobody who is taken seriously, even by a reporter (well, except possibly for the Weekly World News).


    Don't ever think that the economy is less complex than a Kernel, even if it isn't all Open Source. That just makes debugging harder.



    Caution: Now approaching the (technological) singularity.

  • Interesting assertion. Some proof (a hyperlink to a trustable site, e.g.) would be desireable.


    Caution: Now approaching the (technological) singularity.
  • "Do you really believe the Gulf War had *anything* to do with the boom of the 90's."

    HELLO?

    Of course it did. If Bush Sr. had not sent us to the Gulf, oil prices would be out of control because a multitude of oil producing nations would be under the control of one leader.

    We got involved right when we had to.

    Oh, and the comment about cutting back on the crack? That was just low (aka -1: Troll).

  • This whole situation is simply a mirror of most investors and bean counters technical inability.

    Look at Covad for example.. how in the world could a company like covad ever be valued at the amount it was (something like 9 billion IIRC). For a company with as small of a footprint as they have, without even owning thier entire network, the only reason they could be valued so high is inability on the part of the investors to comprehend and understand the technology and infrstructure behind the company. It was all about the service provided.. "This business is going to explode!" Well it did, but not in the way that was expected.

    While people tout the benifits and possible revenues generated by any new technology (or use of existing technology), one thing investors must realize is that business and society in general is much slower to adopt and buy into such things. Partly because of fear of technology as a whole, partly because the rate of advancement is so fast, why would an individual (or business) Spend the amounts of time and money projected, when 2 months down the line there is something newer, better, faster, and cheaper.

    I think the market is better served with more realistic valuations and slower growth. Sure, we won't have as many instant millionaires, but we also will not have people doing stupid things to protect their (overvalued) ideas.

    Now if we could just get sorporate america's hands out of the pockets of the government and bring things back to the individual, we would be much better off.

  • More importantly, the coders that were earned ungodly amounts at Dot-coms might end up out of work, or at a McDonalds and decide to code for Open Source to keep their skillset current...
  • Reasons I buy off the web:

    (1) Easier to shop around for low prices. With brick and mortar stores, uf I don't like the price, I have to DRIVE soemwhere to look for a lower price. Big hassle. Besides, with sites like pricewatch, my search for cheap is even easier.

    (2) Sales tax free! I only buy from web stores that don't collect sales tax. And as long as I batch orders, the tax savings far exceeds the shipping costs. Oh yeah, FUCK use taxes. Ain't no way they can know.

    (3) No hassle. No crowded malls. No traffic. No mall rats. No dinged car doors in parking lots. Less money spent on gas. Stuff comes to my front door.

    (4) Selection. I live in a small town (pop 30,000) far from any big city. The web lets me buy things I could never find around here...including...

    (5) International buying! Visa cards charge in Yen or in Pound Sterlings as easily as they do in Dollars, with no "currency conversion" surcharge.

    Brick and mortar stores lack these advantages.


  • >'74 recession was under Ford(R)
    >'82 recession was under Reagan(R)
    >'90 recession was under Bush Sr.(R)
    >'01 recession ... hmm well ... maybe the Republicans are just unlucky ...


    Oh, come on now. Let's try to be intellectually honest, M'Kay? If we are to lay blame or heap credit on any particular political body, it should be the US Congress, not the President.

    The President doesn't have enough power to control the economy, and shouldn't be tied to it that tightly.

  • I honestly believe that Clinton had very little to do with the longest sustained period of growth the US economy has ever seen. Since you obviously consider his impact substantial, could you please list which of his policies had any direct or indirect effect on the economy?

    Clinton, more than most folks at first, clearly grasped the concept of the global economy. He pushed for this, and the country benefited greatly in subsequent years as free trade exploded around the globe.
    ________________

  • by Christianfreak (100697) on Tuesday January 18, 2000 @07:00AM (#1362747) Homepage Journal
    Why does it frustrate me so much to read a JK article? Probably because they are several pages of saying absolutely nothing with piles of bull thrown in just to keep us reading.

    What is the DotCom era? Isn't an era something that consists of several decades if not hundreds or thousands of years?

    • Rennisance era : 1200AD - 1650AD
    • Neoclassic era : 1750 - 1900AD
    • DotCom era: 1996 - 2000?

    Personally I think that Jon has bought into the the media hype that he so vigorously complains about... the media believes this is an era so does Jon. The media believes there is a recession, so does Jon. The media believes that the Internet has somehow transformed us into super humans or something... so does Jon.

    I'm sorry but judging from the people I go to school with, lots of people have the internet but it just isn't that important in daily life. Some of my friends (God forbid) only check their email once a week! They couldn't care less if the internet dried up and blew away. Our culture simply isn't defined by it, and I have to agree with an above post that the idea that a hive of family photos and quasi-porn such as Geocities does not a community make.

    People are entitled to their opinions but Jon use something besides your dizzying intellect to back it up!


    Never knock on Death's door:

  • by SnapShot (171582) on Tuesday January 18, 2000 @07:03AM (#1362748)

    The one things that really pisses me off is the media coverage of the XMas shoppoing season. From listening to the news you would think that no-one bought anything, but in fact there was an increase over last years record-breaking holidy sales. FYI, an increase over a record would, by definition, be a new record. Duh...

    Online sales were also a record.

    Unfortunately, the heard mentality seems to take over so that during up times only good news is reported and remembered. In harder times only bad news makes it to the headlines.

    On a different tack, as has been mentioned before a downturn in the stock market != a recession. Cynically, some politicians may want to "talk us into a recession" so that, in four years, they can claim they "saved" us during the next cyclical up turn. Reps don't necessaarily have a lock on this type of spin, it just happens that the change in power is going that direction this year...

  • by Lumpy (12016) on Tuesday January 18, 2000 @07:05AM (#1362751) Homepage
    you get dot.com's blazing across your screen with multi-billion dollar advertising campains. flasy ad's in your newspaper/magazines/online/billboards... and then they crumble months later.

    Yes, advertising is an important budget line, but spending more in advertising then what your business is worth is nuts (See pets.com and petopia.com for perfect examples of what NOT to do) anyone with an ounce of business abilities knows this.

    Many many of the dot.coms were failures before they open up shop, it's just that the 90's flurry of activity made venture-capitolists money crazy (as they missed on the apple and microsoft stock buys, and probably got a taste with a buy-in of netscape on their IPO... which is the mark of the start of all this madness) Many millionares were made, I wont dismiss this... but those millionares were made off of the pockets of the investors that lost millions to the dot.com's..

    There are some that will make it. Redhat I believe will become a giant and the corperate flagship for linux (I know it makes everyone scream "NOOOOOOOO!" when they hear it.) I think the fun part is the next 10 years.... we get broadband as standard in our homes, and technology is changing 10 times faster than the last 10 years.
  • And I'm sure they'll give up eating and paying rent as well.

    Your logic is flawed, I would have thought that they would be more likely to spend spare time on open source if they're in a well paid secure job, rather than if they're living hand to mouth. Think of Maslows heirachy of needs.
  • They will go away when the disparities in pay balance out a bit and other career paths offer comparable rewards with all the opportunities that programmers currently have. Until then, people are going to crowd into the field until equilibrium is reached.
  • Anyone with even the slightest understanding of equity markets knew that stock in a company that made no money and had no tangible assets (that includes intellectual property like patents) was worthless. The dotcom boom was driven by the essential irrationality of our current equity trading system (to borrow a Greenspan-ism). The fundamental problem is not technology but some of our basic econimic structures. Reality #1 Technology has dramatically improved productivity, generating a dramatic increase in profit and a higher standard of living. Reality #2 A handful of individuals carry enough influence to make or break individual companies, market sectors, or even the entire economy with a single comment. Reality #3 The American public is just as irrational, basing consumer confidence on our perception of our leadership, hence the mentioned correlation between GOP administrations and economic slumps. Reality #4 For the most part, individuals who produce quality work appear to be finding jobs quickly because technology- especially the web and multimedia is here to stay. And a final Reality #5 If Americans would READ what financial analysts are saying they would know how ridiculous the current system is (eg. a company made a large profit, but its profit only increased by 6% instead of the projected 6.5% therefore the company loses value?) We are building a better world. Technology isn't the ends, it is the means. Let's not bellyache about the silliness of dotcom-ism and instead go make good stuff.
  • by biglig2 (89374) on Tuesday January 18, 2000 @06:16AM (#1362762) Homepage Journal
    What I'm seeing is the dot-coms launched with the idea "I can undercut the big traditional firms because the net frees me from traditional overheads". They get money for old rope for this - because it's at heart a good idea. But...

    ...lots of them promptly go bust because they haven't the business sense they need - they understand the web, not business methods. Selling on the net doesn't free you of all the traditional problems of business - and it introduces it's own sets of problems.

    Now we see the bricks and mortar companies moving into this space. They've seen it can work from some of the examples, they've learnt as their dot-com competitors implode, and now they are ready.

    Xmas 1999 - the biggest on-line toy retailer in the UK was e-toys. Xmas 2000 - it was Toys'R'Us.

    At heart - if a dotcom thinks it can use the net to undercut the big boys - well the big boys can do it too. And they can sunbsides ther adventures in the web, and they don't ned adverts in the superbowl beause their brand is already there.

    Question for the slashdot readers - one aspect of dotcommery was the way 'Net companies became powerful enough to merge on near-equal terms with trad companies. e.g. Time Warner AOL merger. Will the dot-com collapses affect these companies?

  • by tolan's my name (234431) on Tuesday January 18, 2000 @06:17AM (#1362764) Journal
    IBMs Q4 results made 2000 a growth year for them apparently, also services in general are growing, the PDA market is heating up etc etc.

    All thats really happened is that PC have saturated the market, and its finally getting to the point were a 2 year old PC is still quite fast, especially if the bottleneck is a 56k modem.....

    Also GSM phones must be nearing saturation, in europe at least, and people are waiting for 3G to upgrade etc etc.

    My point is that IT spending is still high, is just that equipment has become commoditised and that the markets for traditional ststems are saturated. New items, PDAs, Ultra Portables with wireless comms, Portable digital TVs etc etc are still to expensive to be widespread, basically...

    we're in a transitional phase
  • by kootch (81702) on Tuesday January 18, 2000 @06:19AM (#1362766) Homepage
    get over it! we're not in a recession. it's just a market correction.

    notice: the DOW is still above 10000 (quite healthly infact)

    so the NASDAQ is down... hell, it DOUBLED in two years!!! of course it was going to correct... any economist worth his/her salt could have told you there was going to be a correction.

    what they didn't tell you is that in a correction, the ride down is much faster and harder than the ride up. And considering the double of the NASDAQ in a year, the halving in 6 months is justified.

    maybe this recovery will actually be a graceful stride with it's legs under it.
  • by WinDoze (52234) on Tuesday January 18, 2000 @06:19AM (#1362768)
    And search engines and ISPs have given many thousands of people free and customizable web pages, sparking a culture that is expressive and personalized

    I just have to laugh at the assertion that GeoCities is a "culture" of any sort! Homepages of family photos coupled with people pushing up to the limit of not-quite-porn, together in one place!
  • by Decado (207907) on Tuesday January 18, 2000 @06:19AM (#1362770)

    "For the first time, women comprise a majority of online gamers -- 50.4 per cent."

    Statistic based on the ratio of amazon/sorceress players to barbarian/paladin/necromancer players on the battle.net servers.

  • by jarod (15787) on Tuesday January 18, 2000 @06:21AM (#1362771)
    It is not the critic who counts, not the one who points out how the strong man stumbled or how the doer of deeds might have done better. The credit belongs to the man who is actually in the arena, whose face is marred with sweat and dust and blood; who strives valiantly; who errs and comes short again and again; who knows the great enthusiasms, the great devotions, and spends himself in a worthy cause; who, if he wins, knows the triumph of high achievement; and who, if he fails, at least fails while daring greatly, so that his place shall never be with those cold and timid souls who know neither victory or defeat.

    -- President Theodore Roosevelt.
    1858-1919
  • Ironically, an end (or at least a substantial waning) to the dotcom culture could lead to MORE innovation.

    When I was a grad student in the early 90s, there was quite a bit of interesting research taking place at my company. Novel computing architectures. Novel algorithms development. It was fairly easy to get a small but workable grant to investigate, and often implement, almost any feasible theoretical idea you could propose--- and this was during a major recession remember!

    Then the dotcoms came. And now?

    OS Research is virtually a dead field.

    Research into any non-Intel processor architecture has virtually stopped. (Except for quantum computing... but notice: no dotcoms there, folks).

    "Multiprocessing" now means SMP on NT or Linux.

    Language research was stagnant for quite awhile, thanks to Java and C++. (Functional languages seem to be coming back into vogue now however. Again, notice: no dotcoms in sight).

    And the general computing profession has basically morphed from a quasi-academic profession (remember, we used to be thought of as applied mathematicians) into something halfway between a plumber and car mechanic (guys who keep servers running and spin CGI).

    I've been telling people for 4 years now that the internet boom is the worst thing that could have happened to the computing profession. If the shallow, soulless and stilting dotcom boom is really, really over then I will know in a couple years if I have been right or not.

    :M
  • by aphr0 (7423)
    Katz really does suck. I'm not trolling or anything, just expressing my opinion. I can't believe slashdot still carries this guy. Hell, I can write a few paragraphs catering to slashdot demographic and be about as insightful as this trash. Every articles has the same basic points. 1. "The media" doesn't get it. 2. Politicians don't get it. 3. We're starting an information revolution which will bring about a utopia for all. 4. Packed with references to "geek culture." Throw in a few pseudo-philosophical questions and you have one genuine Katz article.

    Back when slashdot had a poll on whether or not to keep Jon around, I voted yes because I thought he might branch out and express some original and different ideas. Well, I was wrong. How long did he drag out the Columbine ordeal? The first article was decent. Leave it at that. Jon has a tendency to beat an idea to death. Perhaps it's because he's not good at expressing other ideas, or maybe he simply doesn't have other idea, or whatever. The end result is pages of mindless already-done drivel and still more pages of the same slashbots replying with the same thing.

    Surely slashdot, being the large tech news/community site that it is, could attract someone with more ties to the community he writes about and an ounce more creativity. Jon's writing skills are decent, but he needs to stick to other areas.
  • Actually, the US is not yet in a recession. Technically, the definition of a recession is a decline in GDP for two or more consecutive quarters. I can only find US GDP stats up to the 3rd quarter of 2000, but there has been no such decline yet. It is predicted, however, that the next quarter will dip, which is why all the recession talk started. This is my source for US GDP stats. [doc.gov]
  • by Shotgun (30919) on Tuesday January 18, 2000 @07:15AM (#1362784)
    As for the others claiming the economy is cyclical, do they honestly believe Clinton had nothing to do with the longest sustained period of growth the US economy has ever seen?

    It had much more to do with:

    -The ending of the cold war allowing a vast reduction in military spending.
    -The vast amounts of investment wealth available from working baby boomers who will soon begin retiring.
    -A fiscal policy of low interest rates by Alan Greenspan that decreased static savings accounts and increased stock market investments.
    -Low energy cost spurred by high production in OPEC nations.

    I honestly believe that Clinton had very little to do with the longest sustained period of growth the US economy has ever seen. Since you obviously consider his impact substantial, could you please list which of his policies had any direct or indirect effect on the economy?

  • by Tony Shepps (333) on Tuesday January 18, 2000 @08:00AM (#1362788) Homepage
    I dunno. A few years back it was clear that the media had no real understanding about what's going on. Today I have to think that what the media doesn't understand, the general public doesn't understand. And there's less and less that we, the slashdotters understand, that the media doesn't at least have a little grasp of.

    The popularizing of the net means that the waves seem to be following the general public, not the nerds any longer. Yesterday that new Fox show "Grounded for Life" used AOL IM integrally in a major plot point. With Napster, a new approach arrived and within three months my dentist (!) was asking me how to convert MP3 to WAV.

    I have to think that the media understands about the market as much as we understand about the market. I have to think that after reporting the tech slump, the anchors go back to their desks and reply to their emails and search the net for new stories.

    Maybe the time has come to shake them up a little by holding back on the Next Big Thing until it's really ready.

  • by Stavr0 (35032) on Tuesday January 18, 2000 @06:22AM (#1362789) Homepage Journal
    Maybe JK should watch CNNfn once in a while. A recession IS on the way. How big, I dunno, but the 'slump' will affect every sector, not just hightech or dotCOMs.

    '74 recession was under Ford(R)
    '82 recession was under Reagan(R)
    '90 recession was under Bush Sr.(R)
    '01 recession ... hmm well ... maybe the Republicans are just unlucky ...
    ---

  • by robbway (200983) on Tuesday January 18, 2000 @06:24AM (#1362791) Journal
    9 out of 10 new businesses fail (so I'm told). It's clear that so far, 9 out of 10 new internet companies (the publicized ones, anyway), haven't failed. When compared to all other types of businesses, the dot-coms are doing very well.

    The "slump" is probably referring to the unrealistic expectations of dot-coms success compared to their actual success. A business will not automatically succeed if it has a dot in it.

    ----------------------

  • by jht (5006) on Tuesday January 18, 2000 @08:02AM (#1362798) Homepage Journal
    The problem with traditional partisan economic approaches is this:

    Democrats typically want to spend a lot more than the government brings in. And when times are tough, they are happy to spend more in an attempt to prime the pump.

    Republicans want to spend too much as well - and their first reaction to everything is to cut taxes (without cutting spending), expecting the wealth to flow down to the masses.

    The reality is - neither of these approaches work as such. Yes, there are plenty of examples of screwed-up taxes, and there are plenty of places where government spending helps, too. But a proper, centrist approach to economics will balance the two urges - keep spending down and keep taxes from climbing, with the priority on spending the same or less than we bring in in revenue.

    Clinton was forced into this by the combination of government paralysis and a last-minute education in economics. But when he bought the idea of centrist economics, he bought it 100% - and that's been good for the economy in the long term as well as now. We've retired a lot of the US's debt in the last few years, and made the looming problems with Social Security and Medicare into less of a crisis as a result. If W continues on the course of paying off debt (which, if you think about it, is the really "conservative" thing to do) before worrying about tax cuts, then there will be some money available in case we do slip into recession and need to do a little old-fashioned pump priming. When you spend within your means, it's surprising how much flexibility you can get to deal with the unexpected. This applies to governments as well as individuals.

    The stock market bubble formed because people started to overvalue tech companies, not taking into account the actual rate of change. Now that reality has set in, the market (as is it wont to do) is overreacting in the opposite direction. I expect growth to slow substantially for a while as things sort themselves out - but I'm not convinced a recession looms on the horizon. Remember, like the original poster said, a recession means sustained _negative_ growth - not a slowdown, and not a single bad quarter. As for me, I've bought more stock since the market started tanking than I did during the entire run-up - but I'm looking for companies that are well-run and either are making money now or have a clear plan for it in the near future. That excludes about 2/3 of the NASDAQ, though. And I won't worry about how much that stock is worth for a few years, at least.

    - -Josh Turiel
  • by pestie (141370) on Tuesday January 18, 2000 @08:08AM (#1362801) Homepage
    Is anyone else getting the impression that Mr. Katz is preaching to the choir here? If anyone knows the reality of the internet, it's the typical Slashdot reader.

    The first generation Internet belonged to the engineers, dreamers and military researchers. The second belongs to the Geeks and the Dotcommers, who battled one another, sometimes directly, sometimes not, for attention and primacy. It was the Microsoft Era, and it's over.

    This entire article suffers from the underlying assumption that the internet is somehow what the media makes it out to be, even while it proports to argue against exactly that! The internet has always been populated by engineers, dreamers, geeks, military researchers, and dot-commers, not to mention the Unwashed Masses. All that has ever changed is the proportions. The fact that the media fixated on the "dot-com phenomenon" during last few years didn't stop the engineers from engineering, the geeks from geeking, the dreamers from dreaming, or the military researchers from devising more efficient ways to kill and/or avoid being killed. It should also be noted that there's a significant amount of overlap between the above-mentioned groups. Many engineers involved in military research are geeks, and it would be hard to deny that most dot-commers are dreamers.

    Katz acts as if it's some great revelation that things like Napster, Gnutella, and Freenet came to be during the "dot-com era." It's no surprise at all - the "dot-com era" was about the media fixating on dot-coms, not about what was really happening on the internet. The geeks kept on geeking, and more than a few really cool things emerged. I'm sure plenty of military research continued quietly in the background, too.

    The dot-com era was not the Microsoft Era. If anything, the Microsoft Era is yet to come, and that scares me.

    My prediction: computing will spur the creation of Open Societies, digital technologies being applied to open government, different models for doing business, a revamping of intellectual property and a breaking down of hierarchies, barriers between citizens and government, even some national boundaries.

    Katz is showing his Wired roots again. Media outlets like Wired have been promising a technology-driven utopia for years now. So far, the closest we've gotten is Slashdot. <snicker>

    The Net is almost ferociously anti-hierarchical. Online authority reflects online architecture -- it is so de-centralized that the idea of a central information control seems almost impossible.

    Tell that to ICANN.

  • I'm no market guru, but I was watching CNBC the other day and I saw a great graph. They plotted the advance vs. decline line for the last two years. For almost all of 2000, the line was going down. More stocks were going down than going up. Since about November 2000, the line is up sharply. A majority of stocks are going quite well. A whole lot of people are under the impression that "The Dow" (which is actually the Dow Industrials among a bunch of other Dow indexes) is representative of all stocks. Not by a long shot. There are even days when almost all of the Dow Industrial stocks do fairly well, but one of them (mostly INTC these days) craps itself and sends the whole index down. People see the news with it's three second "Dow did this, NASDAQ did this" segment and think the whole economy is tanking.

    There are a ton of undervalued stocks that have been unfairly punished and will be coming right back up. Maybe not to where they were in April 2000, but a whole lot higher than they are now.

    -B

    Subliminal PS: Buy Lucent
  • by sojiro (255286) on Tuesday January 18, 2000 @06:29AM (#1362808)
    If ever there were an unholy marriage, it was the frenzied coupling of venture capitalists and dotcom entrepeneurs. It had to end sometime, and now is a good a time as any.

    Isn't it amazing that now the bubble has burst, the same pundits who predicted the "Long Boom" are just falling over themselves to declare that the past few years were an anomoly? Check out CNBC sometimes. You'll be amazed at all the analysts who "saw this one coming" and "knew that the bubble would burst." Like most talking heads, Katz has an amazing ability to leap from one speeding bandwagon to another.

From Sharp minds come... pointed heads. -- Bryan Sparrowhawk

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