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WEDNESDAY, NOVEMBER 25, 2009
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Online Boom Won't Result in Dot-Com Bust

Heady '90s excesses are more isolated; domino effect less likely

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(Newser) – Today’s Silicon Valley upstarts are enjoying heady times, but without the excess and risk of their late-'90s counterparts, reports the Wall Street Journal. Sophisticated venture capitalists generally bear the risk involved in the next tech crash, and fewer and less volatile IPOs this time around mean small investors are safer.

Startups today require cheaper infrastructure and rely more on outsourcing, so each firm’s risk is smaller. Rather than a crash, a more general economic malaise could spread to the Valley, or big buyers such as Google, Microsoft, and Yahoo could tighten their belts, scuttling small companies hoping for buyouts. Analysts also warn of a downturn in online advertising, many startups' sole income source.

Today%u2019s Silicon Valley upstarts are enjoying heady times, but without the excess and risk of their late-'90s counterparts.
Today%u2019s Silicon Valley upstarts are enjoying heady times, but without the excess and risk of their late-'90s counterparts.   (IndexOpen)
The current Dot-Com boom seems unlikely to undergo a bust similar to that experienced in the 1990's, say experts.
The current Dot-Com boom seems unlikely to undergo a bust similar to that experienced in the 1990's, say experts.   (Shutterstock.com)
Bust 2.0? (AP Photo/Paul Sakuma)
Bust 2.0? (AP Photo/Paul Sakuma)   (Associated Press)
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