The Editors Web Design Group snapshot Going into 2001, Internet and related technology companies have taken a pounding. Only those organizations that are debt-leveraged and cash negative are being pounded in the trenches. The Internet is slowly entering the Mature phase of the product life cycle. What adds inconsistencies that appear to be Growth cycle characteristics are more attributable to the 6 month generation of new software, not the industry itself. The foundation for product success in a Mature cycle center around branding and service levels, combined with conservative financial practices.
Pricing starts to level off, due to the shear number of competitors in the arena.
The process of buying market share through wholesale discounts and leveraged financing typically only works in the Growth cycle. The failure of HarvardNet and Vitts Networks in the last month appears to be the adoption of a business model that leads to IPO, while running consistently in the red. In a Mature phase, capital dries up faster than new clients can be brought on board. Our viewpoint and consulting advice over the last five years to our clients for Internet-related services has not changed. Select a technology partner with a long-standing history of survival in a volatile market.