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Dot-Com Bubble v2.0?

Cliff posted more than 7 years ago | from the oh-no-not-again dept.

200

eldavojohn wonders: "With the recent acquisition of YouTube by Google, there has been a lot of speculation (on both Slashdot & The Toronto Star) that we are nearing the second economic bubble created largely in part by growth in the digital sector. While one may be able to debate that the revenue from advertising and sales can indeed back this growth, are we headed towards the second bubble and, if so, how hard is it going to pop? Keep in mind that popular voodoo economic theory has attributed the first bubble phenomenon to 'a combination of rapidly increasing stock prices, individual speculation in stocks, and widely available venture capital.' I think we're experiencing all those, although it is not as flagrant as it was during the first bubble. What do you think?"

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OMG! v2.0 (3, Funny)

creimer (824291) | more than 7 years ago | (#16494353)

It's "Dot Com v2.0" and no one took out a patent?! Where's my attorney!

Re:OMG! v2.0 (2, Insightful)

2.7182 (819680) | more than 7 years ago | (#16494491)

Actually the best predictor is how many Herman Miller chairs your office has.

Re:OMG! v2.0 (1)

jallen02 (124384) | more than 7 years ago | (#16494603)

Thats not true at all. They are only about $500 dollars and they last a good bit longer than your cheap $100 chair. Not to mention they are quite configurable and worth the money. If they allow people to get more comfortable and work more efficiently what does it matter? $500 is just a drop in the bucket for the cost of your average tech worker making $55,000 / year. Same with dual monitors etc. It makes people feel appreciated and they will very likely be more happy if you show them you care. Or you can replace an office chair every couple of years because you bought a cheap POS at office depot that was no where near as comfortable. So lets just put that one to rest aye?

Jeremy

Re:OMG! v2.0 (0)

Anonymous Coward | more than 7 years ago | (#16494697)

The herman miller chairs are fairly expensive, but they aren't the only ones - have a look at Steelcase specifically the "Leap" chair - $800 retail for the base model!

Of course, the retail for the herman miller chairs are also more than $500 - more like $800+ themselves....

/. is really more of an Alice in Chains crowd: (2, Funny)

smitty_one_each (243267) | more than 7 years ago | (#16495131)

Angry Chair
Sitting On An Angry Chair
Angry Walls That Steal The Air
Stomach Hurts And I Don't Care

What Do I See Across The Way
See Myself Molded In Clay
Stares At Me, Yeah I'm Afraid
Changing The Shape Of His Face

Candles Red I Have A Pair
Shadows Dancing Everywhere
Burning On The Angry Chair

Little Boy Made A Mistake
Pink Cloud Has Now Turned To Grey
All That I Want Is To Play
Get On Your Knees, Time To Pray Boy

I Don't Mind, Yeah
I Dont Mind, I-I-I
Lost My Mind, Yeah
But I Don't Mind, I-I-I
Can't Find It Anywhere
I Don't Mind

Corporate Prison We Stay
I'm A Dull Boy, Work All Day
So I'm Strung Out Anyway

Lonliness Is Not A Phase
Field Of Pain Is Where I Graze
Serenity Is Far Away

Saw My Reflection And Cried
So Little Hope That I Died
Feed Me Your Lies, Open Wide
Weight Of My Heart, Not The Size

Pink Cloud Has Now Turned To Grey
All That I Want Is To Play
Get On Your Knees Time To Pray

Re:OMG! v2.0 (2, Insightful)

stevesliva (648202) | more than 7 years ago | (#16494903)

$500 is just a drop in the bucket for the cost of your average tech worker making $55,000 / year.
$55000 is probably what your average tech worker's family healthcare premiums cost these days... now let's hope that chair's extra ergonomic.

Re:OMG! v2.0 (1)

Cylix (55374) | more than 7 years ago | (#16494907)

Except...

I bought a rather nice chair for around a $100 nearly four years ago. It's still in great shape and still as comfy as ever.

I had to look around for one that was built nicely *roomy too*, but it was worth the time and testing.

Anyhow, sure you could blow $500 on a good chair or put in some diligence and save a good bit.

Re:OMG! v2.0 (0, Offtopic)

joshetc (955226) | more than 7 years ago | (#16495743)

The place I work is loaded with them and they make me feel like crap. Like the company I work for buys expensive shitty chairs to feel good about themselves. I'll take my personal $50 walmart fake leather chair over those pieces of crap any day. Mod me offtopic but business owners everywhere need to know how crappy their chairs are.

Taco's Evaluation (2)

dsginter (104154) | more than 7 years ago | (#16494355)

Methink's Taco's VA Linux stock [yahoo.com] hasn't quite rebounded yet.

Does anyone know if any of the slashdot ownership was realized as cold, hard cash or did it all go down the pipes and stay there?

I'm waiting for the third bubble, myself.

Re:Taco's Evaluation (4, Insightful)

timeOday (582209) | more than 7 years ago | (#16495815)

It's not just Taco. Take a look at a ten year history of the Nasdaq [globeinvestor.com] and tell me we're in a bubble like 1999.

If tech stocks are overvalued now, it's nothing like they were then. Now let's talk about housing [cepr.net] , shall we?

Starting to mimic other economic systems (4, Insightful)

Jazz-Masta (240659) | more than 7 years ago | (#16494359)

Seems to me the Internet is starting to mimic other economic systems, such that it is now subject to the whole boom and bust cycle. Just that they call it a bubble. There will be many of them in the years to come.

Re:Starting to mimic other economic systems (1, Insightful)

Marxist Hacker 42 (638312) | more than 7 years ago | (#16494555)

I agree- the bubble idea just makes it seem wierd. Unique. In reality, capitalism itself just isn't stable- it fails to have enough information transfer to become so.

Anybody know of a stock trading BBS based on slashcode? In such a database may be a solution....

Re:Starting to mimic other economic systems (2, Funny)

Hotawa Hawk-eye (976755) | more than 7 years ago | (#16495547)

Anybody know of a stock trading BBS based on slashcode? In such a database may be a solution....

Finally a good use for mod points! Mod SCO and Microsoft down ...

Bubble??? (-1, Offtopic)

Anonymous Coward | more than 7 years ago | (#16494371)

Let me be the first to say... /POP

Economic Growth (2, Insightful)

dracocat (554744) | more than 7 years ago | (#16494395)

If by bubble you mean a time of ecenomic growth, then yes we are headed there.

The economy is on the upswing, and people (perhaps minus slashdotters) are generally optimistic.

It is very possible to have ecenomic growth without a hyperinflated economy resulting in the proverbial bubble. After the economic growth will be a time of economic slowing and finally a recession of the economy.

You can count on it, although unfortunately you can't set your watch by it. Timing of the whole thing is still not very precise.

Re:Economic Growth (1)

Marxist Hacker 42 (638312) | more than 7 years ago | (#16494579)

It is very possible to have ecenomic growth without a hyperinflated economy resulting in the proverbial bubble. After the economic growth will be a time of economic slowing and finally a recession of the economy.

A recession to me indicates a failure of the market to correctly predict fair prices, in other words, hyperinflation. So what's the difference between economic growth and a bubble? And is the optimism ever really justified in the long run, or are we always fated to have hyperinflationary markets controling our every move like so many dictators?

Re:Economic Growth (1)

RKBA (622932) | more than 7 years ago | (#16495795)

, or are we always fated to have hyperinflationary markets controling our every move like so many dictators?
See here: Money, Banking and the Federal Reserve [google.com]

Re:Economic Growth (5, Insightful)

argoff (142580) | more than 7 years ago | (#16494829)

If by bubble you mean a time of ecenomic growth, then yes we are headed there.

First off, the economy is not on the upswing. While we don't seem to have another dot.com bubble, we absolutely have a housing bubble and that is worse! If your stock tanks, you still aren't making monthly payments on it and it's a lot more liquid. The record low savings rates and record high debt rates are not symptoms of a healthy economy. Neither is the account deficit over 6%. So far the US is the only country in history to have that high of an account deficit and not have a currency collapse. The fact that it is increasing rapidly is not good. (BTW, I know it's political season, so let me just say it's not Bush's fault, but structural - for people who think I'm bashing Bush)

It is very possible to have ecenomic growth without a hyperinflated economy resulting in the proverbial bubble. ....

Not in the US, not since 1911, the year of the federal reserve act. You can't keep printing up money and loaning it into the economy and expect nothing bad to happen. In fact, the efficiency of the information age means that when the money passes thru, that adjustment will be far more extreme, not less extreme. The worst part is that the Fed thinks they have lernt the lesson of the great depression - that the solution is more liquidity. No it's not! It will just change it from a great depression to a hyperinflationary great depression. I don't think people have any idea what they're in for.

Why is everyone so sureal. Any look at the numbers is just terrible, do people understand that the dollar can't make it as a global reserve currency for more than a few more years and likely can't make it as a currency at all within the next decade? Can your family afford a debt of about 480K that is increasing at the rate of about 30K per year? Well, between all the obligations and systemic debt it already must.

Re:Economic Growth (1)

stevesliva (648202) | more than 7 years ago | (#16494979)

The worst part is that the Fed thinks they have lernt the lesson of the great depression - that the solution is more liquidity.
Don't forget the FDIC. If you think hyperinflation is better than deflation, tell me what happens to the average indebted american when wages decline, unemployment rises, and yet the mortgage, student load, credit card and car payments don't decrease? Ooooh yeah, that's bad.

Re:Economic Growth (1)

stevesliva (648202) | more than 7 years ago | (#16494997)

s/is/isn't: "If you think hyperinflation isn't better than deflation... yaddah yaddah yaddah."

Re:Economic Growth (5, Interesting)

argoff (142580) | more than 7 years ago | (#16495871)

In a hyperinflationary depression the economy reaches a point where investors won't invest in businesses, so they then put all their money into commodities. This causes commodities to skyrocket, unemployment to go up, and pay to be pressured down. So everything goes up in price except for pay and profit. That makes the defaults on debt worse, makes the drive to commodities even more, causing a vicious circle. This happened in the late 70's in the US and we were able to break out of it by offering 21% interest on bonds to get investors to stop dumping cash. But this time a 21% prime will rip the US economy to shreds. BTW, over the last 5 years commodities have trippled while pay has done nearly nothing.

Re:Economic Growth (0)

Anonymous Coward | more than 7 years ago | (#16494985)

*yawn*

not this time (1)

jigjigga (903943) | more than 7 years ago | (#16494409)

nah. Google is making it. The others may not be able to compete in the future, but they will still be hanging in there. This current prosperity is the result of the ad based money making scheme and it will work for quite a while, if not until google has penetrated other non-traditional digital markets. TV will be huge, and google will defiantly get into it. The only bubble will be Microsoft's power, as it keeps slipping away for producing nothing. Vista will be far less important than it is being made out to be, and for that the old tech ways will waste away given the time.

Happens All The Time (5, Insightful)

PepeGSay (847429) | more than 7 years ago | (#16494417)

Rises and falls in every sector happen all the time. We don't need to over analyze every rise in the market like it's the second coming. Things will inflate and deflate over time in all areas. The fact is the first dot com bubble burst wasn't that big of a deal. It's not like we had soup lines. Some *speculators* lost money. Enterpreneurs in *speculative* businesses lost their jobs. Really, it had not delitirious effect other than to correct the market and kick out some losers that needed to be kicked out anyway.

Re:Happens All The Time (1)

khallow (566160) | more than 7 years ago | (#16494659)

OTOH, it got pretty large before common sense returned to the land. There was an overall drop of 50% in capitalization of public firms. But I otherwise agree. The dotcom burst wasn't the problem, but having things get that out of hand was a real problem. In comparison, I just don't see a similar level of insanity going on. Doesn't make sense to keep expecting another bubble burst when the markets just aren't whacked out.

"Not a huge deal"? (5, Insightful)

SuperBanana (662181) | more than 7 years ago | (#16494781)

The fact is the first dot com bubble burst wasn't that big of a deal. It's not like we had soup lines.

Wow, talk about revisionism. The first bubble burst was HUGE deal; dozens of major banks grossly violated their 'chinese wall' policies while underwriting the IPOs of clients and looked the other way when internet companies were engaging the shadiest accounting practices known to man. Companies swapped "shares" and both counted it as revenue based on projected stock prices, for example. Tens if not hundreds of thousands of people lost their jobs in "layoffs", and it had a massive ripple effect in places like SF. The crash and delisting of hundreds of "internet" companies destroyed "investor confidence" on the stock market, and affected all manner of investors, from individuals to massive retirement accounts.

Christ, man! It was enough to destroy Arthur Anderson Consulting. Why do you think they're known as Accenture now? Having your top officers lambasted by Congressional investigators for conspiracy, fraud, etc on national TV doesn't exactly bolster confidence in a business where clients are trusting you...

Re:"Not a huge deal"? (0)

Anonymous Coward | more than 7 years ago | (#16494891)

Mod parent up!

I wish I had some mod points.

Re:"Not a huge deal"? (1)

Fulcrum of Evil (560260) | more than 7 years ago | (#16495029)

Christ, man! It was enough to destroy Arthur Anderson Consulting. Why do you think they're known as Accenture now?

Funny, I thought it was Andersen (busload of kiddies) that named itself Accenture.

You're conflating Enron, an energy company, with.. (1)

patio11 (857072) | more than 7 years ago | (#16495665)

The dot-com collapse didn't destroy Anderson. Their consulting arm was spun off before the Enron fiasco in their accounting arm, just as a branding device I might add. This saved all of their jobs when a few bad apples from the auditing division decided to collaborate with Enron regarding hiding their numerous scams, which caused a total collapse of everybody still wearing the Arthur Andersen (note spelling, incidentally) label. This was despite them having over 10,000 partners (that is, partners as "we split the lion's share of the profits" partners, not partners like Starbucks or whoever has employees who they call partner as a PR gimmick) who had no connection to Enron whatsoever.

Nobody lost their retirement due to the tech bubble popping, unless they had manually speculated in the tech sector (and, within that, in the riskiest field of "Burn $2 million for Superbowl commercials" Internet stocks). So the retirement funds went down for a 2 year period. Oh no. It happens. As sure as the sun rises they'll go up again (and they did, and they are -- S&P 500 up about 28% versus five years ago and double what it was 10 years ago). You might remember a particular software company whose software isn't small, its Micro? Yep, they got battered in the bubble, too. They've more than tripled in value over the last 10 years, even accounting for the beating they took when the bubble popped.

Re:"Not a huge deal"? (1)

StikyPad (445176) | more than 7 years ago | (#16496107)

Detecting whether a interviewee has MacOS experience prior to OS X: yell "Frog blast the vent core!" If they run, yes.

Sure, if you don't mind lots of false positives. I don't know about you, but if an interviewer suddenly started yelling at me -- let alone something with the word "blast" in it -- I'd be out the door before he finished his sentence.

Re:"Not a huge deal"? (2, Insightful)

Anonymous Coward | more than 7 years ago | (#16496183)

Christ, man! It was enough to destroy Arthur Anderson Consulting. Why do you think they're known as Accenture now?


Accenture used to be Anderson Consulting, which is not the same company as Arthur Anderson. Also, Arthur Anderson was Enrons auditor, which might have had more to do with their demise than the bubble.

Re:Happens All The Time (3, Interesting)

nevesis (970522) | more than 7 years ago | (#16494857)

I think you're underestimating the impact.

Back in 1997 if you had told me that big and bad US West would be bought out in a few years by the tiny little 1 year old company down the street, Qwest, I would have laughed you out of my office

But then Qwest made a bunch of money during the bubble and took US West by force in one of the decade's most unanticipated and disconcerting hostile takeovers.

This doesn't prove that the bubble was deleterious, and correcting the market certainly isn't a deleterious effect, but it is silly to argue that the actual impact was overblown.

Re:Happens All The Time (1)

Simon Garlick (104721) | more than 7 years ago | (#16495281)

At first glance, I don't see why this is being described as the return of a tech-industry bubble. What's happening now is an ADVERTISING-INDUSTRY bubble.

Sometimes a pipe is a pipe (0)

Anonymous Coward | more than 7 years ago | (#16494421)

Apple just sold more Macintosh computers than ever in their history in one quarter. I would say there is real solid foundation to some of the stock prices going up in the tech sector. (I am glad I got in early. Just wish I'd bought some YouTube.)

Re:Sometimes a pipe is a pipe (1)

helmutvs (912204) | more than 7 years ago | (#16494773)

It would be pretty hard to have bought some YouTube stock, considering they were never a publicly owned company.

Re:Sometimes a pipe is a pipe (1)

5plicer (886415) | more than 7 years ago | (#16494853)

Both Apple and Google peaked around January. Since then, their stock prices remained fairly level... though Apple's has been a bit volatile.

YoU insensitive clod! (-1, Troll)

Anonymous Coward | more than 7 years ago | (#16494423)

The Cathe3Lral [goat.cx]

What is the Metric? (2, Insightful)

SRA8 (859587) | more than 7 years ago | (#16494433)

During the first bubble, we had wild stock prices. Seeing that most of the new back of dot com's are not public, are we making this claim simply based on the purchase prices of a handful of private companies? Seriously, its nothing like the dot com boom of 2000, where hundreds of shell companies went for their golden IPO.

I think... (1)

AKAImBatman (238306) | more than 7 years ago | (#16494441)

...that there *was* something behind the Internet boom, otherwise it never would have happened. If investors (Venture and otherwise) make more informed decisions this time, there's a far better chance at a sustainable market.

In other words, you need a product (*bang* no more Pets.com), you need a business plan (*bang* no more SimDesk), and you need an idea that isn't terrible from the outset (*bang* there goes "MyLackey.com").

What made Youtube take off? (1)

Revenge_of_Solver_Ta (862178) | more than 7 years ago | (#16494443)

Anyone know?

Seems there are/were tons of video sharing sites out there...I can't seem to figure out what made Youtube different.

Why did Youtube take off and blowup and the other video sites just sort of sat there?

Re:What made Youtube take off? (3, Interesting)

bth0002 (458440) | more than 7 years ago | (#16494543)

They provided a seemless entertainment through video at a time when TV cost too much, and movies were not all that great for the money. By over supplying a high demand they catapulted themselves into the checks and balances situation where they are now in. They beat both TV and movies and bittorrent to the fruit punch, the sweet spot so to speak. Instant on TV like entertainment that was both creative and more down to earth. Its like jackass streaming in real time almost. Its not pay per view but in the future if internet on demand takes off aka higher quality internet to compete with cable and microsoft, youtube will have to go the way of napster and netflix perhaps.

Re:What made Youtube take off? (1)

OakDragon (885217) | more than 7 years ago | (#16494639)

I think the primary thing that made them take off was their interface put forward to their contributors (uploaders). You can upload a variety of formats, and your video is ready in a matter of minutes. Myself, I have uploaded several 30 to 60 second clips in MPEG format, each weighing in at 10-20 MB, thinking nothing of compression or conversion. YouTube slurps them up with ease, and puts them into their Flash player with no problems.

Re:What made Youtube take off? (3, Insightful)

DJ Jones (997846) | more than 7 years ago | (#16494707)

Interesting question, and the answer is most likely far too simple for most bussiness executives to comprehend. I would attribute youtube's success to two simple, but important factors. One, they had a good-clean user interface, unlike similair publicly uploaded video sites. And secondly, and more importantly, they enabled even the most basic computer users to easily copy direct URL links to certain videos, essentially turning individual users into advertisers through social networking sites like "myspace".

Re:What made Youtube take off? (1)

lejerdemayn (823082) | more than 7 years ago | (#16495063)

i think it was word of mouth there weren't that many video sites around and youtube with it's easy interface and alot of friend-tell-friend-post-in-a-forum-tell-friend-pos t-in-a-blog-tell-friend started building up

Re:What made Youtube take off? (1)

Yvan256 (722131) | more than 7 years ago | (#16495233)

IMHO YouTube just plain sucks. On Google Video you can at least download the damn things... You know, so you can bring funny videos to friends without a broadband connection (or no internet connection at all) or just plain stop wasting bandwidth watching the funniest ones over and over again. Not to mention the picture quality is better downloaded than streamed.

Re:What made Youtube take off? (2, Informative)

RKBA (622932) | more than 7 years ago | (#16495933)

You can also download YouTube and most other videos with the FireFox plugin at:
http://videodownloader.net/ [videodownloader.net]

During the first bubble (4, Informative)

ackthpt (218170) | more than 7 years ago | (#16494451)

During the first bubble the hubris was so thick in the Silicon Valley air you could feel it. People around you virtually hummed with it. And like The Emperor's New Clothes, if you actually looked at some of the shiny bits you'd notice some what people where trying to sell was utter shite, a scam, not worth a penny, yet people bought their stock on IPO and it all went nuts. There was 'the big strategy', to develope something Microsoft, Oracle or Cisco didn't have and would want and to trumpet it all over the place and hope one of these big companies would make you an instant millionaire by buying you out. Didn't always work.

Now I think most of what is going on in this bubble actually cuts the mustard in the ledgers. It pretty much has to. Too many (ad)venture capitalists got burned and they're a bit more careful now.

Hmmm... (1)

mr_nuff (212669) | more than 7 years ago | (#16494455)

Anybody have a changelog for the version 2.0? I wasn't very happy with the features of version 1.0.

This time it's all "private money" (4, Interesting)

Animats (122034) | more than 7 years ago | (#16494463)

Last time, it was mostly companies going public. This time, it's companies heavily funded with venture capital, and the companies are then bought by other companies.

But it's definitely a bubble. Way too many companies are chasing the same pool of advertising money.

And, unlike Bubble 1.0, most of these new companies don't really do very much. Or even stuff that hasn't been done before.

As I wrote in another article, "social networking" sites have a life cycle. EZboard peaked mid 2003. Nerve peaked early 2002. Bondage.com peaked mid-2003. Tribe peaked early 2006. Xianz (the "Christian Myspace") peaked in spring 2006. Friendster peaked twice, once in late 2005 and again in mid-2006, but that's an unusual pattern. Usually, once they peak, it's downhill after that. Myspace has flattened and looks like it's about to peak. This works just like nightclubs; they become hot, they grow, they get too popular, they get overrun, they decline, they hang on, but nobody cares.

YouTube is terribly vunerable to the RIAA. Once somebody builds a tool to check audio on YouTube against RIAA licensed material, they're going to get notice-and-takedown orders by the ton.

Re:This time it's all "private money" (1)

cultrhetor (961872) | more than 7 years ago | (#16494759)

Last time, it was mostly companies going public. This time, it's companies heavily funded with venture capital, and the companies are then bought by other companies.
Actually, it was a bit of a mix of both - Take a look at Geert Lovink's Critical Internet Culture in Transition: venture capitalists fueled the IPO offerings.

Re: the nightclub analogy (1)

King_TJ (85913) | more than 7 years ago | (#16494835)

Where I live, a couple people have hung onto to very successful nightclubs with years and years of "staying power" by re-inventing them every so often. One of them had a rather unique strategy of closing down at the end of the summer, transforming into a different type of club, and opening back up again until the next spring/summer, when it again closed and transformed back into its "beach club" motif.

Another one has changed names and themes every couple years, when the old one got too "dull" and "passe".

I think it's just as possible for these social networking sites to do. They just need to realize that it's not enough to build the thing once and consider it "finished". They need to plan on constantly monitoring the types of users they're getting and what the competitors do that draws them away again, and keep re-designing the site to accomodate the changes.

Re: the nightclub analogy (2, Interesting)

Animats (122034) | more than 7 years ago | (#16495077)

re-inventing them every so often.

Area, the hottest nightclub in NYC for part of the 1980s, did a complete redecoration and theme change every six weeks. That kept it a hot club for years.

But redesigning a web site doesn't have the same effect. Tribe just did that. (New! Web 2.0! Now you can rearrange your home page!) One of most active tribes is now "Tribe.net bug reports". Oops.

No bubble (2, Interesting)

Rob Kaper (5960) | more than 7 years ago | (#16494465)

There was no dotcom bubble and there won't be a new one. We had a good economy with over-the-top entrepreneurs. It topped, scaled down and weeding selected the sensible business. It happens all the time, in all industries and sectors. New shops open town in good times and silly ideas go bankrupt in bad times. It may look overwhelming because we're so close to the source, but I'm sure the average resident in my neighbourhood isn't even aware of the dotcom tale. It was that insignificant in the grand scheme of economical cycles.

People in the Bay Area say there *was* a bubble (2, Informative)

Infonaut (96956) | more than 7 years ago | (#16495085)

There was no dotcom bubble and there won't be a new one.

There was a tremendous bubble. I was there. I did work for companies that were almost entirely virtual. There was no "there" there. It was all hot air. I know plenty of people who suddenly had fantastic jobs and were living a lavish lifestyle, only to be out on the street looking for a job when the boom dropped on the bubble. Bay Area traffic noticeably thinned for at least two or three years. It definitely was a bubble, and when it popped, the effect was very painful to a lot of people.

My guess is that while the average person on the street doesn't know the entire dotcom tale, they do know that there was a tremendous upsurge in the NASDAQ for a period of time, and that it was fueled by rampant speculation. This isn't the same thing as Starbucks overextending itself by opening 54 shops in Dubuque, rather than the 52 it can actually support. There was a huge outlay of capital, there were companies going public every day, and the stock market had lost all rationality. Even non-techies could see this. All they had to do was watch the news.

This time it is different, in the sense that all of the Web 2.0 companies aren't going public. As another poster has already mentioned, this time it's private capital chasing after some good and many bad investments. When the majority of these companies die, John Q Investor won't take it in the shorts this time. In that sense, the Web 2.0 investment phenomenon is a lot closer to the normal course of business events you describe.

Re:No bubble (1)

pedantic bore (740196) | more than 7 years ago | (#16495357)

I'm sure the average resident in my neighbourhood isn't even aware of the dotcom tale.

Where do you live? North Korea?

Anyone who didn't notice the massive evaporation of apparent wealth a few years ago is frighteningly oblivious.

Self-fulfilling prophecies (4, Insightful)

Wills (242929) | more than 7 years ago | (#16494471)

The more people talk about "the stock market bubble" and upcoming crash, the more people start expecting it and theb selling their stocks, which makes it more likely to happen.

Re:Self-fulfilling prophecies (1)

Slashdiddly (917720) | more than 7 years ago | (#16495517)

The more people talk about "the stock market bubble" and upcoming crash, the more people start expecting it and theb selling their stocks, which makes it more likely to happen.

This is generally incorrect. Market peaks when there virtually no pessimists left. Markets peaks not so much because sellers come in, but because buyers disappear - every potential buyer is already holding a position. Majority of sellers actually sell much further down the road, long after the peak, in disgust, after months and years of waiting/hoping for a recovery that would never come. That point usually makes the market bottom (ie, no more sellers left).

Re:Self-fulfilling prophecies (0)

Anonymous Coward | more than 7 years ago | (#16495601)

The more people talk about "the stock market bubble" and upcoming crash, the more people start expecting it and theb selling their stocks, which makes it more likely to happen.

People selling their stocks is not what causes crashes. People lowering their asking prices is what causes crashes. People value stocks primarily on expected future earnings, and therefore, if expectations remain the same, prices will tend to remain the same. Buying and selling is simply money changing hands; it has little to do with the supply and demand factors that actually determine price. Also, the wisest investors, who naturally tend to have the most money, do not base their expectations on media gossip, slashdot messages, etc. Why base their decisions on emotion when they can rely on the objective measurements of profit and loss?

Stock market crashes happen when many companies begin to report lower profits than expected. Why do profits come in lower than expected? Well, it is the job of entpreneurs and investors to forecast the future and invest accordingly. Therefore, something must have caused the vast majority of investors to miscalculate. What causes this cluster of errors? The answer is in the very first chapter of this [mises.org] pdf...

We are straight in it (3, Interesting)

Shados (741919) | more than 7 years ago | (#16494473)

We're really straight in the middle of the second bubble. Its different than the first in a way, mind you, but a lot of companies have while projects and dreams thanks to the "newfound" power of information technologies (like all the web 2.0 crap). Some work, many don't, and honestly, I don't see how long they'll be able to stay afloat pumping all that money in these projects. Just as an anecdotal reference: I put my resume on Monster 2 weeks ago. I only have an associate degree, and a few years experience in .NET and Ajax. I did not apply -anywhere-. Yet, since I put my resume up, I have gotten at least 2 interview offers per -day- (not counting weekends) for so called "Web 2.0" projects of all kinds, all wilders one than the next.

Frictionless environment (5, Insightful)

mcrbids (148650) | more than 7 years ago | (#16494517)

WARNING: This post sounds remarkably like something written in about 1998. It's still true.

The "digital marketplace" is fundamentally different than the standard "meatspace" environment. In cyberspace, product carries no mass. In many cases, intellectual property is "production grade" the moment it's written. EG: PHP code. There's no duplication cost, virtually non-existent distribution cost, and the result can be seen/used by millions overnight, if you have some servers to handle it.

Note: the servers to handle "millions" can be surprisingly cheap, and getting cheaper every day

So, while it takes an auto company years, and eleventy billion dollars to come out with a new line of cars, it takes maybe 2-5 guys consisting of a decent programmer, a few salespeople, and a book-keeper armed with a few thousand bux to develop a product usable by millions, even if they are working day jobs to pay rent.

So this means that the boom/bust cycle can happen in 2-3 years rather than 2-3 decades.

Get used to it - it's only going to accelerate from here. Ever heard of the technology singularity? [wikipedia.org]

It's coming.

MOD PARENT UP (1)

RagingFuryBlack (956453) | more than 7 years ago | (#16494655)

I completely agree. Technology sector is completely different from other areas of society.

Re:Frictionless environment (1)

cultrhetor (961872) | more than 7 years ago | (#16494843)

As a part of the abstract "THE ECONOMY," what happens here affects what happens in "meatspace." If economics is the study of resource allocation, then the most precious resource in the new "information" economy is not information; rather, it is attention. Physical commodities are abundant - so much so that you can't turn on a newscast without hearing someone bitching about rampant comsumerisn - what is lacking is the human attention needed to make sense of the constant barrage of information. The problem of speed derives from that: we haven't yet found a way to measure such allocations: you can't store attention in a warehouse. You need to continually attract the attention of Joe Consumer, who is distracted - sometimes frustrated - by the overwhelming abundance of similar companies vying for his attention, and therewith, his cash.

Re:Frictionless environment (1)

mcrbids (148650) | more than 7 years ago | (#16495399)

The problem of speed derives from that: we haven't yet found a way to measure such allocations: you can't store attention in a warehouse. You need to continually attract the attention of Joe Consumer, who is distracted - sometimes frustrated - by the overwhelming abundance of similar companies vying for his attention, and therewith, his cash.

It's my belief that wikipedia and the like represent the very beginnings of a new type of economy - the much-vaulted but never-quite-explained economy of plenty, rather than scarcity. We still have an economy of scarcity - we still scratch and claw for stuff, just more of it. (Yes, I want my 3,000 sq foot home, my 4 vehicles, my speedboat, AND my private airplane, dang nabbit!)

But we really long ago passed the threshold of "comfortable" in the developed world - what's really needed is a fundamentally new way of looking at resource allocation. And no, I'm not talking about socialism. But the meaning of "wealth" is about to take a serious makeover.

Re:Frictionless environment (1)

paeanblack (191171) | more than 7 years ago | (#16495247)

In many cases, intellectual property is "production grade" the moment it's written. EG: PHP code.

You are dead wrong, but you aren't going to believe otherwise until you get burned. The optimism of youth may cost you a month of no sleep; maybe it will cost you your first mortgage.

The only way to tell is when, five years down the road, you reread what you wrote and find yourself laughing...or crying.

Re:Frictionless environment (1)

mcrbids (148650) | more than 7 years ago | (#16495481)

Huh?

I write PHP code for a (very good) living, and have been doing so since PHP 3, around 1999. My wife and 5 children enjoy the 3,000 sq foot home, swimming pool, speedboat, and the 5 vehicles that writing PHP code has provided for us. My first mortgage payment was made just shy of 10 years ago... and the PHP code I write is production grade the moment I write it in many cases.

Oh, and I was burned by "non-production" grade code long ago, a la SQL injection. So, I've walked a few miles in my day, and learned a few hard lessons. I use structured code that prevents most common mistakes. EG: prepared statements for the database, standardized filters on input, using security wrappers to prevent many accidental security breaches, etc. The worst is using "Open Source" code out there - much of it is just horrible and usually fails one of my security audits. For example, SPAW is just awful. I even patched a few BIG security holes, and submitted them several times to the maintainer. As of the last time I checked, they still had not been applied.

So when do you plan on making your first mortgage payment?

Re:Frictionless environment (1)

balsy2001 (941953) | more than 7 years ago | (#16495969)

I agree with you completely. In the 90's it was much more dramatic than I think it will be during future cycles because it was brand new. The internet had just started to be a common thing. So while the cycles continue people won't get as silly this time because we all know that it won't change the world in 60 seconds or less.

Stock price != value... (0)

Anonymous Coward | more than 7 years ago | (#16494545)

I happen to work at a "value investment" company. Our general philosophy is that the value of a stock is intrinsically tied to the company it represents.

The funny thing is, lots of people don't agree. They think that the VALUE of a stock and the PRICE of a stock are the same thing.

Beware of buying a stock just because everyone tells you it's popular and the price is rising. Chances are good you're already too late. You'll buy, the price will peak, then fall, you'll dump it to cut your losses, and start looking for that next rising stock, and repeat the process.

The real trick is to find fundamentally solid companies that are currently out of favor, and buy and hold them long enough for the company to rebound...

Re:Stock price != value... (1)

wikinerd (809585) | more than 7 years ago | (#16494771)

This is the philosophy of Buffet, the second richest person in the world. It is correct if you are willing to wait. But those who want fast results have to accept higher risk, as usual.

Re:Stock price != value... (1)

stevesliva (648202) | more than 7 years ago | (#16494879)

The real trick is to find fundamentally solid companies that are currently out of favor, and buy and hold them long enough for the company to rebound.
Thank you, Mr. Buffett. Could you spare a billion for my hot startup?

Re:Stock price != value... (1)

Dunbal (464142) | more than 7 years ago | (#16494975)

Beware of buying a stock just because everyone tells you it's popular and the price is rising. Chances are good you're already too late.

      Unless you're a sharp day-trader (evil grin).

Historical precedents.... (1)

i_want_you_to_throw_ (559379) | more than 7 years ago | (#16494589)

Every time there is an earth shattering technology whether it's been the Internet or the introduction of the auto (or whatever) it's the same: Tons of money get poured into the market, valuations become absurd, implosion, new golden age begins. We're more in the golden age at this point. The internet is not new or novel technology anymore. Your 800 pound gorillas who are going to be around are established i.e. Yahoo!, Amazon, Google, etc. There might be the occasional bright idea but probably no hysteria like we saw in the late 90s.

Speaking of "lost money" on the dot com boom, if you go to Vegas with 200.00, turn that 200.00 into 20,000 and then lose it all, you still only lost 200.00

It's never been lost, but it has been redistributed from the hands of the many to the hands of the compartively few (hedge funds mainly).

Interesting trivia regarding the Dow:
Reaches 995 on February 9, 1966. Doesn't bust it. It closes above 1000 finally on November 14, 1972 and doesn't reach 1100 until February 24 , 1983. (Wikipedia)

As far as a NASDAQ 5,000? We'll see it again the next time there is a revolutionary earth shattering technology.

open source is the bubble burst catalist (1)

zitintheass (1005533) | more than 7 years ago | (#16494609)

pump and dump is comming? free as in beer didn't work, right

Hell naw (1)

ezwip (974076) | more than 7 years ago | (#16494649)

The lamers have learned how to use the internet and they love it. They can spend their entire paycheck online and not even leave the house these days. Everything including their groceries will be delivered. The bubble will not pop again.

Yes (1)

mcguyver (589810) | more than 7 years ago | (#16494703)

Low savings rate, high deficit (as % of GDP the US deficit may be ok but it's a lot none the less), declining dollar, slowing real estate market. Of course these are indicators of an economy slowing down, not a 'dot com bubble'.

Baby Boomers (5, Insightful)

Anonymous Coward | more than 7 years ago | (#16494721)

Baby Boomers all the way. The boomer demographic is the real bubble underlying stock prices, housing prices, etc. Those folks are in their peak earning years, and there are a lot of them. They are pumping HUGE amounts of money into 401Ks, pension funds, you name it. When they start dying, getting sick, retiring, the flow of money will reverse. They will be selling houses and moving into assisted living and nursing homes. They will be taking money out of their 401k instead of putting it in.

Just because the dot-com bubble popped didn't cause these people to stop trying to squirrel money away for retirement. And since they never really saved the way they should, they're trying to make up for lost time by speculating in stocks. So the irrational exhuberance continues. Eventually, though, it will stop. And when it stops, the bubble will collapse in a very very big way.

The fallout will involve all these folks whining about how the next generation should pump more money into SS so they can afford the affluent lifestyle to which they've grown accustomed. Screw 'em. The most irresponsible generation decided to give their life savings to the pinstriped crooks on Wall Street. That's their problem, not mine.

Baby boomers are the big white elephant in the room that everyone pretends they can't see. Instead we have to endure all manner of ridiculous handwaving BS about new economies yada yada yada. Phghght. What a bunch of crap.

the difference this time (0)

Anonymous Coward | more than 7 years ago | (#16494789)

is that companies are actually making money.

for better or for worse, business has finally wised up and worked out how to make money from the internet.

there are also a lot more people online now than there were 4 or 5 years ago. they are regular consumers, whereas before there was a lot of people who had a technical focus in their life. more people = bigger market = better economics and the chance to profit.

As an investor who's been in many IPOs (2, Interesting)

WillAffleckUW (858324) | more than 7 years ago | (#16494887)

I think that it is quite possible the YouTube purchase was over-valuated.

However, the problem is that the market has no useful mechanisms to properly evaluate the true worth of future technologies.

They could be insanely great - legendary.

Or they could be really lame.

So, trying to predict future cash flow and growth at the beginning of a company with a new technology is mostly a crap shoot.

One good rule is - don't buy into a rise. It's better to put most of your money in an index fund (Euro stocks mix with say Total US market at a 50/50 split) and only use speculative funds to invest in such speculative ventures. So, let's say you save $20,000 a year - put at most $2000 in YouTube and other such speculations, where the downside is as likely as the upside.

Also, realize that the one thing most new investors are very bad at is knowing when to sell. When I bought into Red Hat at the IPO, I planned to sell half of the stock at a specific dollar amount, right before the lockup expired and the price dropped for a bit. Then I sold most of the rest when the largest lockup expired. Then I bought back into the same number of shares using 1/20th the money I had "earned". Net result - I had the same number of shares - and a lot of cash.

If you buy into such a thing, be willing to sell part of it when it rises to a certain point. If it falls, know at what price you'll give up. You can also sell at a price when you think it will be quiet for a month or so, lock in the capital loss to wipe out the capital gains for tax reasons - and buy back in one month plus one day later.

Main thing is trust your gut.

Google itself will burst the bubble. (1, Troll)

SexyKellyOsbourne (606860) | more than 7 years ago | (#16494971)

Google is one of the most speculated companies out there -- enough so that, on paper, it's worth 127.62 gigadollars, which is more than 2/3 the value of Wal-Mart and 1/3 the value of Exxon. Even though it does make money, its price/earnings ratio is an astronomical 61, whereas Wal-Mart is around 14 and Exxon is 10, which is a definite sign of tulip fever not unlike what we saw in the late 90s.

But even for the future, as a long-term investment, it's the nature of the business which matters. Most of what google sells is merely advertising -- however, a brick-and-mortar advertising company with total saturation, such as Lamar, has a high P/E ratio as well, but only has $5.6 gigadollars in market cap. Even the ubiquitous Clear Channel only has a $7 gigadollar market cap, and that's with a high P/E ratio, as well.

When google is inevitably reduced to what it's worth (probably a single percentage point of what it is currently) by whatever means -- legal action, bad earnings reports, a downturn in the PC industry, accounting scandals, a recession, its spending away billions of dollars with no results, and what not -- other people will realize that google and every other modern web company is exactly the same way.

Then whammo, Webcrash 2.0.

I feel sorry for anyone who let history repeat itself and may have actually believed these companies would rival major brick-and-mortars in revenue and profitability. The only right thing to do in such situations is to short the stocks.

Re:Google itself will burst the bubble. (1)

stevesliva (648202) | more than 7 years ago | (#16495311)

Most of what google sells is merely advertising
Even if I were to agree that it is "mere" advertising and not also the media on which the advertising is delivered, do you believe that all companies providing fungible services and not physical products are pretty much worthless? Lawyers and accountants don't necessarily do anything that the other lawyers and accounts can't do, but that doesn't mean their firms are worthless.

I tend to think that google looks kind of expensive as well, but it's a huge cash generating machine, and its downfall is not certain.

It's in medical (1)

nate nice (672391) | more than 7 years ago | (#16494993)

The new bubble is alive and very well. It's not in the software development industry, per se.

It's the medical industry right now. It's the thing to do if you're going to college. Become a pharmacist, x-ray or ultra sound tech or some other skilled position in a hospital and earn a very healthy living.

Of course, medical software is a huge industry right now as well.

But basically with the supply of old people getting larger and larger it makes sense that the medical industry is really in a boom right now.

How long will it last? I'm not sure. But changed to our health care system will probably bring about change eventually.

Can't wait (4, Insightful)

twistedcain (924116) | more than 7 years ago | (#16494999)

The system needs a good flushing. The web (and tech in general) is a mess of useless, pointless crap. Thousands if not millions of websites offering pretty much the same thing. Good examples would be the youtube clones, youtube itself being one of course. One good blog to every 1,000,000 poorly slapped together ones. Useless Bookmark/social sites like bluedot. Webmasterworld, where 500 good question/answers have been repeated 5 million times. Digg, a place to visit adsense filled blogs with one or two lines of information and a link to the actual source of information, and never worry about missing one of these adsense filled blog posts, it will be repeated on the front page at least 10 times a day. Not even going to talk about MySpace and the clone army the venture capitalists will be sold into creating.

As for tech, quit cock-teasing us and put together a phone with wireless internet, camera, mp3 player, video player, video recorder, gps, and 3d gaming. Get rid of the psp, gameboy, DS, ipod, palm, blackberry, blueberry, boysenberry, and so on.

A bubble burst only effects the crappy businesses who use copycat ideas and whose only purpose was to make a quick buck. Good-bye and good riddence.

Re:Can't wait (1)

Timbotronic (717458) | more than 7 years ago | (#16496165)

As for tech, quit cock-teasing us and put together a phone with wireless internet, camera, mp3 player, video player, video recorder, gps, and 3d gaming.

HP's very close. [hp.com] No 3D gaming though.

Bubble & Youtube (1)

edusmoreira (978831) | more than 7 years ago | (#16495023)

On the "first" DotCom bubble, I don't like the *speculative* label. By the end of the 90s, the productivity of capital goods had been amazingly enhanced by IT, and no single person on the planet could forecast to which extent that could happen, and probably still can't. The people involved are not always the world-infamous technical traders pressing F5 and F8 to buy and sell, we're talking also about insightful analysts, respectful economists and thinkers that devoted some serious time to that matter, without reaching a consensus. Some of those could be long some stock at the time. So what?

Technology jumps that cause even slight increases in margins might significantly alter decade-long investment policies by those who fight fiercely for a place in their markets. We're not talking about Google, Microsoft, Cisco, but about all corporations that need IT (all of them, from Exxon to Albertsons).

As a professional of the financial markets, and in the M&A business, more specifically, my opinion is that if your cost of equity (future earnings) beats the market, you pay for acquisitions in cash, as interest expense will be lower than future earnings, there'll be no need to dilute shareholders profits. I always tremble when I see incredibly skyrocketing overperformers making decisions that market prices reveal to be irrational. Bingo. Maybe market is mispricing.

I thank yoju for your time (-1, Troll)

Anonymous Coward | more than 7 years ago | (#16495031)

Comuglobalmegawhatever (0)

Anonymous Coward | more than 7 years ago | (#16495045)

Bubbles can burst?

Hmmm, is any of this borne out by facts? (1)

DocJohn (81319) | more than 7 years ago | (#16495055)

.... 'a combination of rapidly increasing stock prices, individual speculation in stocks, and widely available venture capital.' ....

1. Where are the "rapidly increasing stock prices"? Look at practically any .com NASDAQ stock that isn't Google and you won't find it. Most .com companies have had their stock languish. Look at Yahoo! Still meeting quarterly expectations, yet the stock hasn't budged in years, even with their popular Answers service, even with their Web 2.0 acquisitions. Stuck in neutral, like almost every .com stock.

2. "Individual speculation in stocks"? Sorry, again, I'm not seeing this. Other technology companies and stocks that rely on the Internet to provide a barometer for future growth have been stagnant and significantly underperforming the broader S&P.

3. "Widely available venture capital"? It might be out there somewhere, but after just going through a round of pitches for a friend's profitable .com, one with even greater growth potential for the next 5 years, he didn't get any serious bites. In the late 1990s, all you needed was a freakin' business plan to get your $1 or $5MM. Now he went and showed *profits* (not just revenues) year after year for the past 3 years and VCs just shrug and say, "Sorry." So yeah, there may be money out there, but it's certainly not as widely available as it was in the late 1990s.

We're not in a bubble, and if it's the beginning of a bubble, it's at the very beginning of a much more cautious investment pattern that has little resemblence to the last one.

This might make it burst. (1)

Ariastis (797888) | more than 7 years ago | (#16495083)

Rapid ad quantity explosion - Slowly growing target audience (Internet users) + More & More internet uses blocking/ignoring ads = Recipy for an over-bust.

My Webcrash 2.0 Tripwire! (1)

JohnnyOpcode (929170) | more than 7 years ago | (#16495217)

Last bubble, I invented a new index tied to Herman Miller chairs. It basicaly goes like this;

1) If chairs are flying at Microsoft, things are good in many ways!
2) If there are lots of Herman Miller chairs on eBay (and servers et al.), then things are bad!
3) If Herman Miller knock-off chairs (from China) are on sale at Staples, good for the global economy, bad for Herman Miller!
4) If you're working, and they come and take your Herman Miller away, this is potentially very bad!
5) If you're working, and they come and replace your lawn chair with a Herman Miller, this is potentially very good!
6) If you don't know what a Herman Miller chair represented in the last bubble, then you won't know what to look for in the next bubble.

:)

Re:My Webcrash 2.0 Tripwire! (1, Informative)

Anonymous Coward | more than 7 years ago | (#16495739)

hmmm, lets see what joel has to say about this [joelonsoftware.com]

Let me, for a moment, talk about the famous Aeron chair, made by Herman Miller. They cost about $900. This is about $800 more than a cheap office chair from OfficeDepot or Staples.

They are much more comfortable than cheap chairs. If you get the right size and adjust it properly, most people can sit in them all day long without feeling uncomfortable. The back and seat are made out of a kind of mesh that lets air flow so you don't get sweaty. The ergonomics, especially of the newer models with lumbar support, are excellent.

They last longer than cheap chairs. We've been in business for six years and every Aeron is literally in mint condition: I challenge anyone to see the difference between the chairs we bought in 2000 and the chairs we bought three months ago. They easily last for ten years. The cheap chairs literally start falling apart after a matter of months. You'll need at least four $100 chairs to last as long as an Aeron.

So the bottom line is that an Aeron only really costs $500 more over ten years, or $50 a year. One dollar per week per programmer.

A nice roll of toilet paper runs about a buck. Your programmers are probably using about one roll a week, each.

So upgrading them to an Aeron chair literally costs the same amount as you're spending on their toilet paper, and I assure you that if you tried to bring up toilet paper in the budget committee you would be sternly told not to mess around, there were important things to discuss.

The Aeron chair has, sadly, been tarnished with a reputation of being extravagant, especially for startups. It somehow came to stand for the symbol of all the VC money that was wasted in the dotcom boom, which is a shame, because it's not very expensive when you consider how long it lasts; indeed when you think of the eight hours a day you spend sitting in it, even the top of the line model, with the lumbar support and the friggin' tailfins is so dang cheap you practically make money by buying them.

The #1 sign of a bubble is... (0)

Anonymous Coward | more than 7 years ago | (#16495269)

I was in the thick of the first dotcom bubble. And the #1 warning sign that it was, indeed, a bubble was that people talked about bubbles all the time. Everywhere! I have also lived through recessions and slower expansions that didn't pop. Nobody talked about bubbles much then.

So I can tell you confidently, based on this article and many others I've read: yes, we're in a bubble now.

I was right!! (0)

Anonymous Coward | more than 7 years ago | (#16495405)

I predicted this more than 2 weeks ago, BEFORE the Google/YouTube acquisition, and with almost exactly the same thesis.
http://www.thrica.com/blog/archives/21 [thrica.com]
Now where's my Nobel Prize?

Cashing in the brownie points (1)

viking80 (697716) | more than 7 years ago | (#16495419)

The venture firm that invested in Google itself also invested in youtube, and I think the VC (which is on Googles board) really wanted their Youtube investment to be a success, and cashed in some brownie points.

They probably also got enough PR and excitement around hight tech investments that they might pull inn a few billlions more from other VC investors.

Google probably dont mind spending an extra billion making their old VC friends happy.

Business as usual (1)

Webomatica (1002011) | more than 7 years ago | (#16495463)

I don't get the sense there is a huge buble yet. A lot of the companies being started are trying to be smarter. Cost to create web company is way down. Seems like most of the wasted money back in 1999 was for advertising... giving stuff away for free and blowing millions on superbowl ads, and thinking you should expand fast and hire hundreds of people before your competitor. Second, the IPO market is pretty much non-existent so most companies are being bought by bigger ones, so the average Joe that lost money the first time around is buffered. Still I think the YouTube deal is pretty bubblicious. We'll know in the months to come. If your 18 year old cousin says he's moving to San Francisco to start Mowgo.com and your grandmother starts asking "What's this Web 2.0 thing? Can I make money starting my own web site?" I'd get out the umbrella...

no... (1)

m3rr (669531) | more than 7 years ago | (#16495519)

I don't think that this new "bubble" is as unstable as the last one. Because of the much (much) lower cost of online publishing compared to that of 6-7 years ago, net-repreneurs (=P) don't have as much to lose as they did in those days. Not to mention the fact that VCs are now more cautious in what they invest in and how much. While you might have gotten millions of dollars in capital for your online business then, you are likely to only get tens of thousands or even a couple hundred thousand now.

What do I think? (0, Offtopic)

skribe (26534) | more than 7 years ago | (#16495723)

I think it's time to sell my domain name. Bidding starts at $100,000.

may not be bubble (1)

john_uy (187459) | more than 7 years ago | (#16495735)

a lot of tech companies now are buying others. i guess the main goal here is to eliminate competition rather than create new sources of income.

let's take google and youtube for example. if google didn't buy youtube, some other company will have the access to the users. it's a loss for google. by gobbling them up, they reduce the chance other companies from competing with them.

well look at amd and ati. for me financially, i don't see the advantage to amd. but it shakes the arena.

Like any other kind of bubble (1)

dkleinsc (563838) | more than 7 years ago | (#16495737)

A fool and his money are soon parted.

Bubble 2.0 - (1)

sunsrin (842762) | more than 7 years ago | (#16496029)

Some have already started listing the waste [techcrunch.com]

Stable Market (1)

lilfields (961485) | more than 7 years ago | (#16496279)

This completely ignores why the dot com bubble even happened. You are comparing a time in which revenues with no profits led to amazingly high P/E ratios to a time when Google is profitable (and is even in the S&P 500) and only trades at 61 times earnings (despite it's massive growth rate). When the bubble popped, there were companies with no profits with little revenue with 80 times earnings or more. It amazes me how many people speak of the market when they don't even know of it, or its occurrences. Along with the high P/E ratios we were headed for a recession in 2000, the current U.S. economy is merely slowing according to recent economic data; a recession is currently out of sight. Aside from the economics of the situation, Google is to me more of a business model than a search engine or advertising company. A small business could build their entire business around Google, much like many do with e-bay.

One Company Is Not A Bubble (0)

Anonymous Coward | more than 7 years ago | (#16496367)

Sorry folks, but Google isn't an economic bubble. It's an economic pimple.

Granted it might be what anaysts call a "bellweather" stock for the industry, but that's not the same as actually being an industry, much less an entire economic bubble.

Google just has a lot of cash and feels like shopping. The number's involved are nothing on an economic scale, though I'd be happy to have my 1% cut of a deal that big!

We geeks tend to think we are the center of business, but there's a lot more money outside of the IT industry than there ever will be inside of it.
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