What began as a mechanism to allow researchers to communicate with each other over 30 years ago has become the foundation for the biggest revolution in modern-day business. The Internet, piggybacking on the rise of the computer, has connected people, computers and businesses worldwide, and spurred innovation on an unprecedented scale. Today, nearly 100 million computers and 500 million people are connected by the Internet worldwide.
The defining moments for the dramatic increase in the Internet penetration and usage worldwide were the creation of the Web, hyperlinking and HTML by Tim Berners-Lee at CERN (in Europe), followed by the development of Mosaic by Marc Andressen and his team at University of Illinois, Urbana Champaign (in the US). HTML and its simplicity allowed the publishing of documents by anyone, and enabled documents to be linked to each other, creating what became the “World Wide Web”. Mosaic (and then Netscape) gave the Web a graphical interface and made accessing these documents as easy as just clicking on blue-coloured underlined words.
The IPO of Netscape followed by the subsequent IPOs of Yahoo, Excite, Lycos, Amazon and eBay and their monumental valuations fired the imagine of entrepreneurs worldwide and unleashed perhaps the greatest modern day “gold rush”. The race for eyeballs was on. As money flowed first from venture capitalists and then from the public markets, companies raced to build websites for every conceivable offering for consumers and for businesses.
A new industry was being created. Old business models meant little as companies were valued based on multiples of their traffic. The New Economy was here. Speed and time-to-market mattered. Profits didn’t. Youth was in, Experience out. When AOL bought Time Warner and PCCW took over Hong Kong Telecom, the “revolution” was complete.
In many ways, this “irrational exuberance” perhaps shortened the adoption period and acceptance of the Internet, the Web and eCommerce dramatically. As “Old Economy” companies faced competition from upstarts, there was a frenzy to adopt the Internet in many aspects of business. But the Internet by itself was not a disruptive technology. Consumers and business processes change slower than technology. Relationships and practices built over years do not simply go away just because of the Internet.
The last fifteen months have seen a dramatic, almost unbelievable, change in the world of technology and in people’s attitudes towards technology and new-generation entrepreneurship. As the stock markets collapsed taking with it many listed and private companies, it seemed like the end. But it was only the end of the beginning. The change being brought about by technology and the Internet is for real. As we shall see in the next few columns, a new Internet is being built – an Internet that is helping glue together great progress in computing, communications and software. Only, this time around, profits do matter.