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The Dot-com Bubble 2.0

13 March 2008 Sören Zschoche 4 Comments Stocks

In times when every third 14 year old boy founds his own web-design, -programming or -optimization company, when 20 year old guys earn one million dollar by selling links on www.milliondollarhomepage.com, I ask myself, is it really possible that there appears another web bubble?

You think this two examples above are impressive? Look at Mark Zuckerberg, a 23 year old ex-Harvard student, who founded a community with the name Facebook, which estimated worth is 15 billion dollar. He is 23 and created this value within 4 years! Other examples are Myspace, Youtube or FEEDBurner, all sold for several hundred million dollar. But what is the difference of this companies to the dot-com companies of the year 2000? First of all, most dot-com companies where listed at the stock markets and had curious business concepts like selling vegetables via Internet. The companies of the Web 2.0 generation earn their money with ads.

So when you recognise that the world wide advertising market had been taxed with more than 400 billion dollar in 2007 this valuations could be plausible. But the problem is that these Internet platforms have no true customer loyalty and experts predict that these communities and platforms will be replaced by new ones during the next 5 to 10 years. So in my opinion we can definitely speak about a bubble cause these new Web 2.0 companies do not earn the money they should and probably won´t ever do.