Dot-com Shutdown Pace Slows, Signaling Shakeout Is Ebbing

At least 93 Internet companies closed their doors or filed for bankruptcy protection in the first six months of 2002, down from 345 such casualties during the same period last year, according to the San Francisco research firm that has been keeping a tally of shutdowns.

June, which had 13 shutdowns, marked the sixth consecutive month in which the number of shutdowns came in at less than 20. That's a considerable contrast from the 16-month period preceding January, when casualties averaged 44 a month.

Since January 2000, when the Internet froth was at its peak, at least 862 dot-com companies have failed, according to Webmergers.com data.

E-commerce and content companies--many of which were business-to-consumer concerns that were quick fatalities during the first wave of the Internet shakeout --dominate the Internet company failures to-date.

Of the 862 shutdowns, 368, or 43 percent, are e-commerce companies, while content companies have a tally of 217, or 25 percent. Infrastructure, Internet access and professional-services companies account for 16 percent, 10 percent and 6 percent of shutdowns, respectively.

Over the past two months, shutdowns were dominated by Internet-content providers, infrastructure companies, Internet-services providers, and other providers of dial-up and broadband Internet-access service.

As companies disappear, many people would prefer to forget the excesses of the dot-com frenzy, when start-ups, often based on little more than a PowerPoint presentation, scooped up millions from investors before collapsing.

Webmergers.com has found, though, that a number of individuals are interested in remembering tales of such excesses.

The research firm, along with the University of Maryland's Robert H. Smith School of Business, last week launched an online archive designed to create a permanent record of the dot-com era.

The Web site, www.businessplanarchive.org, encourages former Internet executives, employees and investors to submit e-mails and other items from both failed and successful dot-com companies.

So far, more than 400 individuals have registered with the site and its researchers have been promised hundreds of business plans, says Webmergers president Tim Miller.

In one case, an East Coast venture capitalist who was about to destroy 1,500 business plans called up researchers and offered instead to ship them to the Business Plan Archive, says Miller in his latest report.

Copyright © 2002 The Associated Press. All rights reserved. The information contained in the AP News report may not be published, broadcast, rewritten or redistributed without the prior written authority of The Associated Press.