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The Myth Of The Tech Slump

JonKatz posted more than 13 years ago | from the good-riddance-to-the-dotcom-era dept.

Technology 168

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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168 comments

Tech slump? Not where I'm sitting. (2)

tjwhaynes (114792) | more than 14 years ago | (#1362642)

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

Media bandwagon effect . . . (4)

osterby (104420) | more than 14 years ago | (#1362643)

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.

Good Riddance (3)

Halloween Jack (182035) | more than 14 years ago | (#1362644)

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.

I don't think the DotComs were a bad thing (5)

JWhitlock (201845) | more than 14 years ago | (#1362647)

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 outside world came .. and has been rebuffed? (1)

pezpunk (205653) | more than 14 years ago | (#1362649)

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.

Re:Maybe not a myth... (2)

HiThere (15173) | more than 14 years ago | (#1362652)

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.

Re:Everyone else please leave. More jobs for me. (1)

Bon Homme Richard (245114) | more than 14 years ago | (#1362653)

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.

Re:I can see job market slowing (2)

arnie_apesacrappin (200185) | more than 14 years ago | (#1362655)

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.

Less Lawsuits? Try more... (1)

doogieh (37062) | more than 14 years ago | (#1362659)

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.

I use the web all the time (2)

peter303 (12292) | more than 14 years ago | (#1362660)

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.

Re:WAKEUP CALL!!! (1)

gudacmacattacq (244549) | more than 14 years ago | (#1362661)

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.

Men a minority in online gaming? (2)

Ronin X (121414) | more than 14 years ago | (#1362662)

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.

Re:Maybe not a myth... (1)

cavemanf16 (303184) | more than 14 years ago | (#1362663)

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.

The Hype Economy (2)

Alien54 (180860) | more than 14 years ago | (#1362664)

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.

I can see job market slowing (2)

Sherman Peabody (147565) | more than 14 years ago | (#1362665)

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.

This is analogous to pruning a tree (1)

ErrantKbd (260589) | more than 14 years ago | (#1362666)

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.

Re:Dodgy statistic (2)

flynt (248848) | more than 14 years ago | (#1362667)

I'd like to see a survey on cyber sex. Just how many of those were REALLY women? This gives me some hope.

Maybe not a myth... (4)

AntiPasto (168263) | more than 14 years ago | (#1362673)

but definately an economic cycle. I'm perfectly happy with a recession. Just means another boom.

----

Makes me think... (3)

Lumpy (12016) | more than 14 years ago | (#1362678)

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.

Re:Makes me think... (3)

TheReverand (95620) | more than 14 years ago | (#1362683)

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.

Re:Makes me think... (1)

WinDoze (52234) | more than 14 years ago | (#1362685)

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.

Re:WAKEUP CALL!!! (2)

JCMay (158033) | more than 14 years ago | (#1362686)

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.

!1st post!!(text added to bypass stupid filters) (1)

rosewood (99925) | more than 14 years ago | (#1362687)

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.

Re:Men a minority in online gaming? (2)

SirSlud (67381) | more than 14 years ago | (#1362688)

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.

Re:Maybe not a myth... (2)

Fat Rat Bastard (170520) | more than 14 years ago | (#1362689)

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.

Re:...hmm not a universal downturn (2)

slim (1652) | more than 14 years ago | (#1362690)

"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.
--

Re:Realistic Expectations (1)

bmj (230572) | more than 14 years ago | (#1362691)

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.

50.4% == Statistical TIE and LIE (1)

rosewood (99925) | more than 14 years ago | (#1362706)

"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!

The impact on open source... (1)

arikb (106153) | more than 14 years ago | (#1362707)

...will be a positive one, IMHO.

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

Re:Dodgy statistic (2)

SquadBoy (167263) | more than 14 years ago | (#1362708)

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.

Wow that's original... (2)

Salsaman (141471) | more than 14 years ago | (#1362709)

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.

Re:WAKEUP CALL!!! (5)

The Mayor (6048) | more than 14 years ago | (#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....

It was inevitable (2)

Undocumented (225683) | more than 14 years ago | (#1362719)

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.

Re:The impact on open source... (2)

Cannonball (168099) | more than 14 years ago | (#1362720)

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...

Re:WAKEUP CALL!!! (1)

rosewood (99925) | more than 14 years ago | (#1362721)

But it was the trickle down effect from the 80s that got us the boost we have enjoyed for 18years (1qt from 1982 to 2000 was down, and it was slight and it was in 1991)

I just noticed- (1)

uninerd (79304) | more than 14 years ago | (#1362722)

Why is it that JonKatz is the only one to submit slashdot articles that are consistently another ten paragraphs? The other guys occasionally go into more detail- but I'm usually pretty surprised if I see less than 5 or 6 paragraphs under his name. The funny thing is, for my major (science technology studies) I had to write a lot of the same crap he posts on here. You know, asking big deep questions, and then making no attempt to answer them... He might be trying to stir up a good forum by not answering, but my prof would have kicked my ass if I left so many open ended questions in one of my essays.

When they do, web store no longer sales tax free! (2)

Anonymous Coward | more than 14 years ago | (#1362723)

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.

Re:Tech slump? Not where I'm sitting. (1)

adjensen (58676) | more than 14 years ago | (#1362724)

> 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.

IBM's growth, combined with the decline of other manufacturers, is just another sign that re-centralization is the future of tech. It's interesting that IBM gave the world a standard for personal computers, effectively pulled back from the market, and never really gave up their strengths in large scale implementations. What, if anything, did they understand about technology that Apple, Dell and the like did not?

In five years, when most of your software is run off of mainframes running some variant of un*x, carried down a broadband pipe to your thin client box, telephone or teevee, the big money will be in IBM and whoever's providing the broadband and thin clients.

IBM may not be a bellweather check of how technology in general is doing, because I think that they understand the future, while the rest of the sector does not. Most of the 'me too' Dotcoms will go away from traditional business reasons (poor management, not understanding financial realities, pure competition, etc) but those who provide the backbone of the whole thing will always be successful.

Re:WAKEUP CALL!!! (2)

Boiner (58993) | more than 14 years ago | (#1362726)


>'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.

Jesus Christ! (1)

Faulty Dreamer (259659) | more than 14 years ago | (#1362727)

How does Katz do it. He wastes so much space to say what I've been saying the past few weeks very concisely.

The Net, much like the economy is in a correctionary period.

There you go, that's all it would have took. The page after page of bullshit spewing out of Katz's mouth is more for his own gratification than for the benefit of his readers. I grow tired of his irksome tendencies to blow even the simplest analysis into a huge, overbearing, bore-them-to-death article (or worse, a series). But yet, like a really bad car wreck I wish I hadn't seen, I can't look away.

Katz makes me feel like that one comedian described (Lewis Black?) feeling when he heard, "If it weren't for my horse, I wouldn't have spent that year in college." Ah, no, oh no, my head is going to explode.

A funny parody . . . (1)

osterby (104420) | more than 14 years ago | (#1362728)

See Feed Mag [feedmag.com] for a send up of this very topic. It's set in 2004 and Amazon is still around, but it's selling shelter and berries.

Re:Maybe not a myth... (1)

SnapShot (171582) | more than 14 years ago | (#1362729)

You're both right up to a point. A correction was obvious and inevitable. When the downturn would take effect is much, much harder to predict. Do you sell after one year, five years, or ten years of expansion? What if the NASDAQ went up for another 10 years before the correction?

The correct answer is: "anyone that was that sure the market would go down during the fall of 2000 would have sold short and made lots of money; if they sold short on the stocks that actually went down and not on the stocks that didn't go down... "

Saying that a downturn was inevitable is not the same as saying that you can use that information except to try and keep oneself insulated from the worst eventuality; keeping a little bit of cash liquidity, not over-expanding, maintaining cordial relationships with labor and suppliers, etc. etc..

Re:WAKEUP CALL!!! (2)

Private Essayist (230922) | more than 14 years ago | (#1362730)

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.
________________

Re:Bandwagon Jumping (1)

SnapShot (171582) | more than 14 years ago | (#1362731)

On PBS there is a Money Week (or something like this) with Charles Ruckheiser (sp?). Every week he has a segment were he ranks various analysts predicitons.

I don't watch frequently, but it seems he checks them out for their mid-range correctness (6 months or so.) Only a few have been getting little "halos" the last couple of times I've watched the show.

Re:WAKEUP CALL!!! (1)

JWW (79176) | more than 14 years ago | (#1362732)

If we are entering a recession, how the hell was that Bush's fault? This one is purley coming on based on Clinton totally ignoring the increase in fuel prices (affecting everyone, everywhere), and the timing on the dot-com bubble bursting. The good times (measured by the NASDAQ boom) were FAKE it was that irrational exuberance that Greenspan was talking about.

You are right about the centrist fiscal policy, but Greenspan's the one doing that. He's basically been running the economy as an engine and changing the mix by manipulating interest rates. It's actually very good fiscal policy. Look for the fed to lower rates 2 or three meetings in a row. But... something has to happen with fuel prices, or were in trobule. Manufacturing can only cut costs for so long before prices will have to rise (unless you sell electricity in CA then you can't raise prices). If fuel prices don't come down the only way I can see for the consumers to keep up their spending will be a tax break.

there's room for everybody, right now (1)

kipple (244681) | more than 14 years ago | (#1362733)

I've read the article and I found it extremely interesting. It's pretty balanced, I share the opinions, and I found myself nodding in agreement several times.
I only have one doubt: even if the Net will turn into a huge hoping-for-money machine, where VC will throw megabucks into it, what's wrong in that? they'll finance bandthwidth and free connession, but they cannot stop the "geek underground", the flow of information that runs under the fancy web graphics, under the high-speed tv streaming, and that uses just a low amount of resources.
on the long run VC will come and go, but people will start using the best technology for the lowest cost. NASDAQ means money. OpenSource isn't done for money but to /improve/ our living. They won't match, ever.

Pet Peev (1)

Decado (207907) | more than 14 years ago | (#1362734)

Just wondering why would someone moderate humour down as overrated? Is there an unwritten rule that humour shouldn't be moderated above 3?

From the /. faq: "Remember though, what rips your sides out may be completely inane to somebody else". Conversely whats inane to you might be funny to someone else. Just a personal grievance that I had to get off my chest.

50k tech employees losing their jobs - a myth? (1)

tenzig_112 (213387) | more than 14 years ago | (#1362735)

It's fun to take an antithetical position to generate hits.

If it's a thesis that is obviously misguided but overly long, people won't read it all and will assume that the author is super-smart.

good is evil, and evil, good. [ridiculopathy.com]

Re:Media bandwagon effect . . . (1)

cavemanf16 (303184) | more than 14 years ago | (#1362746)

Naahhh. I doubt there's that many intelligent people in the world. I'm sure there's plenty of people who like following the bandwagon media because it doesn't take much effort on their part. Just plop down in front of the boob-tube and listen. No thinking involved. I for one have quit watching the evening news altogether. There's so much more info and differing opinions on sites like this and WorldNetDaily.com [worldnetdaily.com] that to blindly accept what mass media tells me would be irresponsible of me. Sure it takes more work, time, and effort to read all the different sources, but I feel much more confident in what I read from multiple sources than what I hear from one person.

A person is usually quite intelligent, but people are dumb.

History According to Jon Katz.... (4)

Christianfreak (100697) | more than 14 years ago | (#1362747)

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:

Christmas Season (3)

SnapShot (171582) | more than 14 years ago | (#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...

Re:...hmm not a universal downturn (1)

FeralChicken (105499) | more than 14 years ago | (#1362749)

"GSM phones must be nearing saturation, in europe at least, and people are waiting for 3G to upgrade etc etc."
..."As a result, demand for mobile phone hardware in europe is about as likely to reach saturation as the demand for trousers."
I took the usage of the term 'saturation' here to mean that the original poster feels that most people in Europe who want a mobile phone have one by now. I.e. the majority of mobile phone sales are now people upgrading rather than new customers.

Western Wide Web (1)

Garg0y1e (249701) | more than 14 years ago | (#1362750)

"My prediction: ...Open Societies,..a breaking down of hierarchies"

I don't think we'll see Regulators and Moderators arising any time soon (I too read Sterling's "Distraction") . This Ameri-centric article seems to miss China, India, Russia, Africa, etc. Not only are they far from a Tech Slump but they seem relatively ripe for a virtual land-grab by the same capitalists that are mooning around over the western dot.com fallout.

These 'non-westerns' have always had less of a bottleneck to contend with relative to intellectual property. They also have fewer legacy systems, many have a dire need to improve internal logistics (food, medicine, entertainment), and there lots and lots and lots of people in these places that don't want their Societies opened, their Heirarchies broken, their culture lost.

As every good capitalist knows, these "problems" are, or will be, opportunities. The graduate students will get around to addressing them, the suits will do their money thing, and the same old cycle will go on.

What I have noticed... (3)

Lumpy (12016) | more than 14 years ago | (#1362751)

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.

Re:Dodgy statistic (1)

Schnedt Microne (264752) | more than 14 years ago | (#1362752)

Yikes! I thought children still comprised the majority of online gamers.

When you look at the real numbers, Men probably constitute 12-18% and Women probably constitute 8-10%.

Female children are not women.
Male children are not men.

Re:The impact on open source... (2)

meadowsp (54223) | more than 14 years ago | (#1362753)

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.

Re:Summary of article: (1)

MadAhab (40080) | more than 14 years ago | (#1362754)

It's like an Oliver Stone or Spike Lee movie - it looks good at first and seems well done, but it would be ten times better if a good editor slashed it in half.

Boss of nothin. Big deal.
Son, go get daddy's hard plastic eyes.

Re:Wow (1)

ocbwilg (259828) | more than 14 years ago | (#1362757)

Hey, I feel the same way about rap "music", but just because I don't like it doesn't mean that it isn't culture.

Re:Maybe not a myth... (1)

bluebomber (155733) | more than 14 years ago | (#1362758)

notice: the DOW is still ... blah blah blah

The stock market does not determine when a recession begins or ends. A recession is two consecutive quarters of negative growth in the economy. (Measured by GDP, not the DOW, NASDAQ or any other stock index.) So the point you are trying to make is correct. The growth in our economy is slowing (decelerating), but has not reversed to become negative.


-bluebomber

Re:Everyone else please leave. More jobs for me. (2)

Lemmy Caution (8378) | more than 14 years ago | (#1362759)

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.

Hype, whims and myths (2)

brinn10 (192826) | more than 14 years ago | (#1362760)

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.

Summary of article: (1)

big_groo (237634) | more than 14 years ago | (#1362761)

I've noticed something interesting...Whenever I read a Katz article, I lose interest half-way through. The articles start off pretty good, but then they seem to disintigrate into this mash of hyperbole and rhetoric. I find myself skipping to the last paragraph to get the gist of the article, and I still feel empty. I find myself thinking "so what?".

Occam's Razor: There is no Tech Slump.

Don't bother reading the article. It's a waste of time.

dot-coms being replaced with bricks and mortar (5)

biglig2 (89374) | more than 14 years ago | (#1362762)

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?

...hmm not a universal downturn (5)

tolan's my name (234431) | more than 14 years ago | (#1362764)

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

Re:Maybe not a myth... (5)

kootch (81702) | more than 14 years ago | (#1362766)

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.

Wow (3)

WinDoze (52234) | more than 14 years ago | (#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!

Dodgy statistic (5)

Decado (207907) | more than 14 years ago | (#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.

success (3)

jarod (15787) | more than 14 years ago | (#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

One New Inovation (1)

SnapShot (171582) | more than 14 years ago | (#1362775)

You're missing the obvious one: ONE-CLICK SHOPPING.

It was so innovative it was granted a patent!

Let's hope so. (2)

meepzorb (61992) | more than 14 years ago | (#1362776)

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

Re:Media bandwagon effect . . . (1)

retinaburn (218226) | more than 14 years ago | (#1362777)

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.
But the media has the effect of MAKING it true....media unfortunaley tells people what to do, rather than reporting.

Re:WAKEUP CALL!!! (1)

Yunzil (181064) | more than 14 years ago | (#1362778)

2. Riding the wave of Bush Sr.'s policies and Gulf War. (Same kind of economic boom happened after WW1 and WW2-for the winners of the wars, anyways)

Hang on, I take exception with this one. Do you really believe the Gulf War had *anything* to do with the boom of the 90's. Do you think the Gulf War was even close in scale to the two World Wars? If you do, you probably should cut back on the crack.

Re:Dodgy statistic (1)

b0z (191086) | more than 14 years ago | (#1362779)

I'd like to see a survey on cyber sex. Just how many of those were REALLY women?

Not many. The women are all off playing Diablo II and Unreal Tournament. The men are the ones that go to chatrooms looking for love.

Jon (2)

aphr0 (7423) | more than 14 years ago | (#1362780)

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.

Re:Maybe not a myth... (2)

Spamuel (246002) | more than 14 years ago | (#1362781)

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]

Re:Everyone else please leave. More jobs for me. (1)

Schnedt Microne (264752) | more than 14 years ago | (#1362782)

I just heard somebody who had called into a radio program last night saying he was going to 'get into being a computer programmer for his new career.' It was obviously somebody who's never had any interest in the topic at all up to this point.

These people need to go away.

Re:Maybe not a myth... (1)

Exedore (223159) | more than 14 years ago | (#1362783)

Yes, recessions are inevitable. Find a dictionary and look up the term business cycle... no wait, I'll do it for you [dictionary.com]

The Fed's true role is to moderate the business cycle. When successful, as they have generally been since the hard lessons of the 30's, recessions still occur, they just don't become full blown depressions.


---------

Re:WAKEUP CALL!!! (5)

Shotgun (30919) | more than 14 years ago | (#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?

Re:Realistic Expectations (1)

Darkstorm (6880) | more than 14 years ago | (#1362785)

In reality I think allot of these companies don't have enough profits to cover them through the after xmas slump. Allot of companies have lived and died by xmas rush buying. Since there is so many online companies and stores and people seem to be about fed up with all the hype, sales overall for most companies were low.

Now since some of these companies are going belly up (3dfx still ticks me off) media seems to be forcusing on the fact that so many companies are going under and stocks are falling. The real result of all this is the thinning of the heard...the strong will stay, and the rest go away. This type of thing goes on all the time, so we have a lot more web programmers and it people looking for jobs, according to the commercial becoming nt certified could get you $65K a year (down from $75K 3 months ago). Maybe, just maybe, this will bring the demand down and the push for people who would make better sales people will stay away from IT and programming.

Overall, this is good for all of us and the technology world. And if the media wants to make a crisis of it, they can, my job seems to be stable.

Re:WAKEUP CALL!!! (1)

MadAhab (40080) | more than 14 years ago | (#1362786)

The idea that politicians who take credit for a good economy are mostly Democrats is patently ridiculous.

I'd chalk it up to the fact that you must be about 12 years old, except that you should know that many people were talking about a bounce in the market when Bush was confirmed the winner, on the mindless supposition that only Republicans are fiscal conservatives. That bounce did not happen, which does confirm your notion that politicians have less to do with economic conditions than you might think.

I'm also a little puzzled at the idea that suing the tobacco companies has anything to do with balancing the federal budget. You gotta stop believing everything you hear on AM talk radio. Reducing spending and increasing revenue due to the economy has balanced the federal budget, and Clinton can take some credit for that.

Boss of nothin. Big deal.
Son, go get daddy's hard plastic eyes.

yes! yes! yes! (1)

roven003 (194720) | more than 14 years ago | (#1362787)

And the same thing goes for the predicted 'slump' in the automotive industry. I'm looking outside and there are plenty of cars indeed. Also, my aunt likes to play bingo on Saturdays even though she has social phobia syndrome and she's a little too heavy to walk. How would she get to the community center without a car?

Re:Media bandwagon effect . . . (3)

Tony Shepps (333) | more than 14 years ago | (#1362788)

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.

WAKEUP CALL!!! (5)

Stavr0 (35032) | more than 14 years ago | (#1362789)

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 ...
---

Everyone else please leave. More jobs for me. (1)

Anonymous Coward | more than 14 years ago | (#1362790)

Finally we can be rid of these types who read a ".com" book on how to start a business or "HTML coding for dummies" and fancied themselves "experts" in the "IT" industry.

Good riddance. These people were finally realized for the frauds they are (as evidenced by all the failed and non-profitable startups).

Those of us with real educations, i.e., degrees in computer and software engineering and who are in it for the long haul will come to be appreciated by management who by now has learned that reading a book on Java does not a master programmer make, but instead results in the horrific spaghetti code that any language, even Java and other OO languages can result in.

I for one, welcome the new stability to come.

Realistic Expectations (3)

robbway (200983) | more than 14 years ago | (#1362791)

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.

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

Not dead yet (1)

ishrat (235467) | more than 14 years ago | (#1362792)

The very fact that people are discussing the downs of the Dotcom age is proof that that it is still a very important surviving part of our society. No Farewell opportunities here.

Damn right it is. (1)

makoffee (145275) | more than 14 years ago | (#1362796)

The media has been hyping the whole tech industry failing thing. If the .com rush is over then good. Im a web contractor, and I will admit I was abit scared when a lot of the .com start-ups started crashing (mostly because I like working at them), but quite frankly I've never had more work or more money. I don't see it as failing, I just see it evolving.

Re:WAKEUP CALL!!! (3)

jht (5006) | more than 14 years ago | (#1362798)

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

Preachin' to the choir (3)

pestie (141370) | more than 14 years ago | (#1362801)

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.

Re:Maybe not a myth... (2)

Ralph Wiggam (22354) | more than 14 years ago | (#1362803)

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

Re:WAKEUP CALL!!! (1)

CgiJobs (114410) | more than 14 years ago | (#1362804)

maybe the Republicans are just unlucky

No, they just get elected more often. (At least in the past 30 years.)

Re:Maybe not a myth... (1)

DeadSea (69598) | more than 14 years ago | (#1362805)

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.

That is absolutely untrue. The stock market is simply not that predictable. Anybody that was that sure the market would go down would have sold short and made lots of money. Anybody who didn't sell short but now says that it is "obvious" that it was going to go down, is only using hindsight and is full of shit.

Re:Maybe not a myth... (1)

balbuzaro (159796) | more than 14 years ago | (#1362806)

A recession isn't really inevitable. The purpose of the central bank is to ensure steady growth and avoid economic contraction (a recession).

GWB will probably listen to Greenspan even more than Bubba did because of his second-class mind but first class temperment.

Salvation (1)

slackweed (253533) | more than 14 years ago | (#1362807)

"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."

If we are in need of a Tech Salvation, what is it that we need to be saved from? Perhaps it's the general public being convinced by the media that there's going to be a slump that needs to be saved.

Bandwagon Jumping (4)

sojiro (255286) | more than 14 years ago | (#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.

Hate to tell you this, Jon.... (1)

GlobalEcho (26240) | more than 14 years ago | (#1362809)

...but there is a slump in one way you seem to have overlooked. Tech jobs. Granted things were a mite overheated before, but a lot of wheat is being fired along with the chaff.

- Brian
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