The NYTimes ran an interesting story about the new dot-com bubble that appears to be well underway ("Silicon Valley Start-Ups Awash in Dollars, Again," October 17, 2007).
It talks a bit about how it appears that many start-ups are once again focussing on building an audience more than building profits, and that this approach appears to be attracting major interest from venture capital.
A side note, I've been very impressed lately with the info-graphics in the NYTimes business section. For example, I thought the preceding graphic did a really nice job underscoring the comparative market-caps of a few hot technology companies, while also pointing out that their market cap is dramatically out of sync with their relative profits compared to some big old companies like IBM and HP.
It does seem like this time around the technologies for online advertising, the techniques for online advertising, the business models, etc. are better established than they were at the height of the last dot-com bubble. But will it be enough to sustain the next technology gold rush?
In some ways it seems like the rules of the game haven't changed much. Yahoo was a major player back in the old gold rush, and they are once again reporting higher-than-expected earnings. As long as there are these big players in the market willing to shell-out big bucks for smaller experimental ventures, it seems like things will be ok. But just as before, once the big established web company profits start to dry up, all the little guys who were hoping to be bought-out will go the way of the dodo.
