A look back before predicting the Web's future


With Christmas celebrations finished and the final days before the Y2K bug strikes ahead, it's fitting to take a look back at the past year's developments and happenings related to the Internet, and hazard predictions for the coming year, too.

One hundred years ago, this new-fangled device called the telephone was starting to make waves. A few years later, radio moved quickly from the realm of amateur to professional broadcasting as the listening public grew -- and commercial use of these new media developed. And let's not forget television, cable and satellite broadcasting.

Today, it really is no surprise that the ever-expanding Internet was identified recently as "the next big thing" by friends and coworkers I informally polled.

INVESTING. Internet-connected companies -- the so-called "dot-com" companies -- are fueling the continued double-digit growth of both the Dow Jones and Nasdaq.

The markets' exhuberance and growth exceeds most analysts' predictions -- and investor's dreams. Even Federal Reserve Chairman Alan Greenspan wasn't quite sure what to make of the markets this year.

Technology stocks -- which make up most of the Nasdaq composite -- have allowed it to grow 75 percent in the past 12 months.

Companies like Qualcomm have shown exhasperating 1,000 percent gains on the year. Not be outdone, DoubleClick Inc. and RealNetworks both turned in gains of more than 700 percent on the year.

In fact, in the shadow of such mega-performing stocks, it seems that stocks that only return gain 15 or 20 percent are considered poor investments!

What made 1999 such a different year for investors?

According an article in Inter@active Investor, 1999 was the year when Wall Street began to take Internet investing seriously -- which meant the hunt was on for companies that offered high returns in both long- and short-term investments.

Traditional investors have calculated investment ratios, P and E figures, etc., in order to best determine where to invest.

In the heady world of Internet company initial public offerings (IPOs), millionaires can be made overnight -- and investors can find themselves on the wrong end of the investment stick, depending on their luck.

The Internet created big changes this year in how investors enter the markets.

A year ago, the largest brokerages were mostly still thumbing their noses at online investing.

Not so today, thanks to the explosive success of firms like E*Trade and others who were pioneers, offering investors ways to access the markets at considerable savings on broker commissions.

As we prepare for the new Millennium, investors everywhere are finding their brokers offering some sort of online trading -- at considerable discount over traditional broker fees.

E-COMMERCE. This year's holiday sales season saw explosive growth in electronic commerce -- to the point that the question wasn't if the Internet would allow for timely purchases, but whether or not the real-world shipping companies -- UPS, FedEx and others -- could promptly ship those purchases home.

As expected, the top e-commerce sites showed growth this holiday shopping season.

The popular eToys.com Web site nearly doubled this year, with 4.9 million montly users. Both KBkids.com and the Toys R Us Web site showed similar growth over the past year.

Bookseller Amazon.com saw some big gains over the past year too, topping the list of Top Five Internet e-commerce sites compiled by Media Matrix for mid-December.

Amazon.com made the cut as the top Web site for one of the folks who responded to my impromptu poll.

"Do you remember hearing about them last Christmas? I don't. They understand that their Web site is the business -- not just another medium to promote their business."

Rounding out the top five were eBay.com, eToys.com, BarnesandNoble.com, and Toysrus.com.

"I think if you are a business and you are not on the web, you are definitely missing out on a lot of customers," wrote one respondent.

The future of e-commerce is equivalent to the future of the Internet, according to those who responded to my survey.

"I think with online shopping now you will need to have that available because it is really going to be gaining popularity. I know I did my first online shopping this Christmas and had to have my credit cards hidden cause it was so much fun!"

Another respondent agreed that e-commerce was where the Internet's growth was headind.

"If the web sites can keep up with the orders, and the package delivery companies can keep up

with the deliveries (another reason to buy UPS stock), online shopping for everything is still going to have the most impact because it's changing our culture."

TOP WEB SITES. Favorite Web sites for the year seemed to vary with the personality and likes and dislikes of those who responded to my survey.

Those mentioned (in no particular order) included:

  •  Yahoo!

  • The News-Enterprise Online

  • Area banks that offer online banking services

  • Ask Jeeves

  • CNN

  • Amazon.com

  • eBay.com

COMMUNICATIONS. From its earliest days, the Internet has been all about communication; and several of those surveyed mentioned the Internet's value as a simple communications tool.

"I think it (the Internet) improves the quality of life for a lot of people, bringing them closer to distant family members and more current on important events," wrote one individual.

JUNO FREES ACCESS. Juno Online Services announced last week its plan to offer its Internet access for free beginning next year.

Juno has half a million paying users of its Internet access, along with 2.4 million users of its free e-mail service.

The free Internet access will be ad-supported and similar to existing free Internet providers who place banner ads on the computer's desktop while users are connected to the Internet for free.

The company will keep offering its free e-mail service and its fee-based Internet access. Those who pay the $9.95 a month for Internet access won't be forced to view the ads like users of the free service will.

Comments and questions about this column may be sent to jbrooks@myoldkentuckyhome.com, or visit www.myoldkentuckyhome.com on the World Wide Web.

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