9/03/2011

Dot-com bubble

The dot-com bubble was a speculative bubble covering the period between 1995 and 2000. The bubble was a global phenomenon, which involved many international banks, mutual funds, venture capital, private investors from all over the world. Since public use of the Internet expanded rapidly over the years, Internet business seemed as an infinite source of profit and opportunity. Therefore a group of new purely Internet based companies commonly referred as dot-com emerged. New business paradigm suggested that the survival of the internet company depends on expanding its customer base as rapidly as possible, regardless of the financial result. For example, Google and Amazon did not see any profit in their first years. Amazon was spending money on expanding customer base and advertising and Google using the funds to create a more powerful search engine machine. These are, however, the shining examples. Many failures include NorthPoint Communications, Global Crossing, JDS Uniphase, XO Communications, and Covad Communications. Companies that produced network equipment such as Nortel, Cisco and Corning were at a disadvantage and also failed miserably. Read more about the dot-com bubble.















1 komentar:


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