Is the writing on the wall (again) for the internet industry? We are currently experiencing ‘web 2.0’ and this is enabling an apparently endless rise in the revenues derived from web advertising (with US internet advertising reportedly rising 25 per cent in the third quarter of this year to a record $5.2bn). As a result, media and technology firms are investing billions in building their online advertising businesses – and even Microsoft is pledging to be a ‘powerhouse’ in advertising in the future.
Moreover, according to a recent report, many people who are looking to work for web 2.0 start-ups are prepared to sacrifice pay in exchange for shares in the venture they’re joining. And over 75 per cent of candidates joining dot-com start-ups through the IT staffing company ReThink Recruitment have foregone a third of their salaries in exchange for shares. These levels are, allegedly, close to those seen during the first dot-com boom of a few years ago.
Comment: The German philosopher, Friedrich Nietzsche, came up with the idea of eternal recurrence – the idea that history repeats itself, since the universe has been recurring endlessly and will continue to do so for all time in an incomprehensible way. After our experience of the bursting of the ‘dot com’ bubble, we could apply this idea to the ‘web / bubble’ cycle. Is this ‘boom and bust cycle’ going to go on for ever in IT and its related sectors, as Nietzche suggested – perhaps in shortening cycles as the pace of technology increases? If so, isn’t it time – for all our sakes – that we learnt some lessons?