Is the Internet Eden or Armageddon? (1,887 words)
by Denny Hatch
In the place without place, anarchy reigns once worked for a cherubic-faced, hard-drinking publisher named Franklin Watts. "Good morning, Frank," I would say each day. "How are you?"
"Happy as a country without a history," he'd respond.
How long has it been since the Internet was without a history and considered the new Garden of Eden—a paradise of investor and intellectual euphoria unmatched in the entire spectrum of human endeavor? Less than eight months.
Remember the thinking of those heady times?
• For investors, here were infinite horizons of obscene profits that turned traditional business models on their ear.
"Those who cannot remember the past are condemned to repeat it," wrote philosopher George Santayana. Financial history buffs will recall the South Sea Bubble of the 1700s; Teapot Dome Scandal in the 1920s; Anthony "Tough Tino" De Angelis, perpetrator of the Great Salad Oil Swindle of the 1960s that sent the stock of American Express into a downward spiral. I see no difference between these great flimflams of the past and the 24-year-old wunderkinds of Boo.com burning through $135 million in six months and the avuncular old ex-Surgeon General who conned investors into spending as much as $45.75 for shares of Drkoop.com only to have it implode to $1, as well as the legion of other high-flying dot-coms on the NASDAQ ash heap.
• Direct marketers would no longer have to spend $500/M on mail and catalogs because reaching people on the Internet is basically free.
If true, please explain why a major list broker told me at the American List Counsel lunch in New York this past May that fully 10 percent of her business was from dot-com companies using the mail to promote Web site traffic. I just received my first curiously targeted print catalog from a Web site, PetFoodDirect.com.