Grove: The party's over
October 12, 2000 04:15 PM PT
by Michelle Rushlo
The days of free-flowing investments in new technology and Internet
companies are clearly over, said the chairman of Intel (INTC) today.
Noting the merciless decline in many tech stocks, Intel chairman Andy
Grove said, "It's a period of time when we have cause to doubt our
own beliefs."
He appeared with a panel that included Priceline.com (PCLN)
founder Jay Walker, Yahoo (YHOO) co-founder Jerry Yang and
Lotus Notes creator Ray Ozzie at Intel's eXCHANGE conference in
San Francisco.
Grove said while the market may not reflect the high-tech business, it
can affect advertising campaigns and company purchases. Investor
money is going to have to be replaced with self-generated funding, he
said.
Technology's promise has not diminished but investors who "fairly
indiscriminately gave us money" are no longer there, Grove said.
He and the other panelists agreed that the notion of return on
investment has regained its status as an investment standard.
Yang said in the past year, the Internet market has been overheated
with too many companies being funded simply because they were
dotcoms. But he said the Internet still has not realized its potential to
become integral to education, government and business.
"There's always going to be a gap between what the market sees and
what's really going on," Yang said.
Walker of Priceline, the name-your-own-price seller of airline tickets
and other services, said he does not believe investors are attacking his
business model, but he does believe investors have lost patience with
companies that have not demonstrated profitability.
The market's willingness to wait for black ink and give companies the
benefit of the doubt is over, he said.
Yang, too, defended his portal company's ability to grow as the
number of unique users plateaus.
He said there is still potential for growth abroad, and even in the United
States there is the opportunity to grow the number of services and
amount of time users spend on Yahoo. |
