Is the Dot Com Bust Coming to an End?

In a sign that the Internet sector may be nearing the end of its
18-month-old shakeout, a new report from Webmergers.com shows the number of
shutdowns and bankruptcies by dot-coms in the first half of this year fell
73% from the same period last year.


While at least 93 Internet companies closed their doors or filed for
bankruptcy protection in the first six months of 2002, the number is down is
down dramatically from the 345 cases during the same period in 2001,
according to the San Francisco research firm that has been tallying falls in
the industry.


June, which had only 13 shutdowns, marked the sixth-consecutive month in
which the number of shutdowns came in at less than 20, a world of change
from the 16-month period preceding January, when casualties averaged 44 a
month.


Since the height of the dot-com frenzy in January 2000, at least 862 dot-com
companies have failed, according to Webmergers.com data.


Of the 862 shutdowns the majority have been e-commerce and content
companies, with 368 (43%) and 217 (25%), respectively. Infrastructure
(16%), Internet access (10%) and professional-services (6%) companies round
out the top five.


With many of the e-commerce companies weeded out, the shutdowns have become
dominated by Internet-content providers, infrastructure companies,
Internet-services providers, and other providers of dial-up and broadband
Internet-access service.


Despite many ex-employees desires to forget such Internet-wonders as
garden.com and homegrocer.com, Webmergers found that a number of individuals
are still interested in remembering the dot-com heyday.


The research firm, along with the University of Maryland’s Robert H. Smith
School of Business, last week launched an online archive designed to create
a permanent record of the dot-com era. The Web site encourages former Internet
executives, employees and investors to submit e-mails and other items from
both failed and successful dot-com companies.


According to Webmergers President Tim Miller, more than 400 individuals have
registered with the site and its researchers have been promised hundreds of
business plans.


“It has been said that those who fail to learn from the past are doomed to
repeat it,” said Miller. “By collecting the blueprints of both failed and
successful businesses, we hope to create the raw materials for that learning
to take place.”

The Business Plan Archive is part of a larger archive being assembled by
Internet Archive, a nonprofit organization that records Web pages for
historical purposes. The project, which is funded through a $300,500 grant
from the Alfred P. Sloan Foundation, will also document the personal
experiences and accounts of the “refugees” or “working class” of the
Internet boom and bust. This information, as well as the business-planning
documents, will be archived and permanently housed at the Archives and
Manuscripts Department of the University of Maryland Libraries.

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