The recent events in the financial industry brought back memories of the Internet dot-com era of the late 1990s, only a short decade ago.
In the speculative dot-com bubble that developed during those years, a lot of people were talking about the rise of a new economy that rendered obsolete many business practices, including business models based on revenue, cash and profit. They felt that in this new Internet economy, the emphasis should now be on increasing market share, clicks and eye-balls as fast as possible regardless of the impact on the bottom line.
There was a buzz in the air that in this new economy, "born-on-the-Net" startups had an inherent advantage over existing,” brick-and-mortar" businesses. Because of their grounding in the physical world, it was thought that such old-fashioned companies could not possibly compete in this fast-moving digital space and were therefore headed for extinction. Thus, many otherwise smart people rushed to invest in new Web-based companies regardless of their financial soundness, hoping to strike gold in this new economy.
At the time, I was general manager of the IBM Internet Division. Looking back at what we accomplished in those days, I am frankly almost as proud of what we did not do as I am of what we did.