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To: Dutch who wrote (24588)	12/13/2000 12:29:19 AM
From: stockman_scott	Respond to of 65232

The Downfall of Internet Consultants Examining the downfall of the eConsultants provides an excellent case study of failed business models. Rose-colored glasses, a lack of a sustainable competitive advantage, and a "me too" mentality are just some of the mistakes these companies made. By Todd N. Lebor (TMF TeeTime) December 11, 2000 Before the recent bashing of Internet stocks, Internet consulting companies (eConsultants) were very hot. But those companies were also some of the hardest hit over the past year. Companies like Scient (Nasdaq: SCNT), Viant (Nasdaq: VIAN), and Sapient (Nasdaq: SAPE), have seen huge swoons in their share prices over the last year. For example, Scient watched its stock price sink from $133.75 to $2.87 over the past 12 months. Internet consultant companies went public to a fanfare of interest. The Internet was changing the world and these guys were going to teach everyone how to take advantage of it. But something went very wrong in the process. The eConsultants failed to do the one thing that they were supposed to be helping their clients do -- build a sustainable business model. Just look at the following chart. Nearly every eConsultant is trading at an all-time low and most are trading at per-share prices less than the cost of a happy meal. Company 52-Week High Current Price % ChangeiXL $58.75 $1.13 (98%)Lante $87.50 $1.94 (97%)MarchFirst $81.13 $1.41 (98%)RazorFish $56.94 $2.41 (96%)Sapient $75.56 $11.56 (85%)Scient $133.75 $3.94 (97%)US Interactive $92.00 $0.31 (100%)Viant $63.56 $4.25 (93%)Xpedior $34.75 $0.41 (99%) These guys are supposed to be smart enough to counsel the CEOs of future success stories, but what kind of example are they setting with their own companies? Tracing this downfall is an excellent case study for what has gone wrong with so many of today's struggling dot-com companies. Me too The eConsultants clearly suffered from a "me too" problem. Just like the dot-coms before them, and optical companies today, business models were thrown together on the backs of napkins in late-night gab sessions. eConsultants jumped in headfirst to the Internet gold rush, without regard for competitive threats. But competitors started popping up all over the place, thanks to virtually no barriers to entry and tons of cash. Too much money The eConsultant business model held up for a while as Wall Street fantasized about getting in on the next Cisco (Nasdaq: CSCO) or Siebel Systems (Nasdaq: SEBL). Very little attention was paid to a company's fundamentals and even less to the business plan. Fear of missing out led to a buying frenzy, and became the dominant investing criteria. VCs and investment bankers tossed cash around like it was "Monopoly" money and the eConsultants grabbed at it. With so much money available, business plans suffered and a short-term mentality took over. Demand spike The rise and fall of eConsultants parallels the real estate industry in the late 1980s and early 1990s. As demand for commercial real estate spiked in the '80s, every developer and his cousin jumped into the fray and started building. Soon, there was an overabundance of supply and waning demand. Prices had only one way to go -- down. eConsultants ramped up their hiring to meet demand; now that the demand is no longer there, thousands of employees are paying the price as their employers go through a massive downsizing. Rose-colored glasses The similarity to the real estate industry doesn't stop there. During the nine years I worked in that industry, I never saw a 10-year projection that forecasted a drop in rents. Never! All too often, projections are merely a continuation of current trends. Consultants are supposed to be the ones with vision. They are supposed to look forward and anticipate the changes to come. Once again, the eConsultants forecasted blue skies, failing to see the inherent flaw in their own business models -- no sustainable competitive advantage. Sustainable competitive advantage Partially as a result of the back-of-the-napkin business model approach, many eConsultants lacked one of the most fundamental ideas behind any new company -- a better mousetrap. What were the eConsultants offering that other consultants weren't? Young, full of enthusiasm, and armed with the power and knowledge of the Internet, many eConsultants popped up and expected to be able to take on the McKinseys and Booz-Allens of the world. Now they are discovering that the relationships firmly established by these old economy consultants are integral to building a sustainable competitive advantage. That's a lesson the eConsultants are learning the hard way. Fools are always on the lookout for companies with sustainable competitive advantages and a number of these companies are highlighted in Industry Focus 2001. It provides a look at 17 compelling industries of the future and the major players in each one.

To: Dutch who wrote (24588)	12/13/2000 2:20:59 AM
From: anandnvi	Read Replies (1) \| Respond to of 65232

Dutch, If Gore had appealed to USSC for standardized state wide recount following election instead of picking selected counties we would not be here today. JMHO, but I dont think so. My understanding of the Supreme Court's judgement is this -- FLSC was right in ordering a recount according to FL law, but there are no laws spelling out the standards for the recount. This would make the recount unconstitutional as it would violate the requirements of equal protection. The Supreme Court would not have set rules for a "standardized state wide recount" - that would be creating new law, which is the work of the legislature, not the judiciary. Anand PS I just realized I have been posting my thoughts here without saying hello to everybody! Fine thread here, and a lot of great brains - Im such a frequent lurker that I felt at home from the first post and forgot to say I was coming out of lurking mode :)