Editing Dot-com bubble (section)

==Overview==
Low interest rates in 1998–99 facilitated an increase in start-up companies.

In 2000, the dot-com bubble burst, and many dot-com startups went out of business after burning through their [[venture capital]] and failing to become [[Profit (accounting)|profitable]].<ref>A revealing look at the dot-com bubble of 2000 — and how it shapes our lives today | (ted.com)</ref> However, many others, particularly online retailers like [[eBay]] and [[Amazon (company)|Amazon]], blossomed and became highly profitable.<ref name="auto1">‘Wallets and eyeballs’: how eBay turned the internet into a marketplace | eBay | The Guardian</ref><ref name="auto">How Amazon Survived the Dot-Com Bubble | HBS Online</ref> More conventional retailers found online merchandising to be a profitable additional source of revenue. While some online entertainment and news outlets failed when their seed capital ran out, others persisted and eventually became economically self-sufficient. Traditional media outlets (newspaper publishers, broadcasters and cablecasters in particular) also found the Web to be a useful and profitable additional channel for content distribution, and an additional means to generate advertising revenue. The sites that survived and eventually prospered after the bubble burst had two things in common: a sound business plan, and a niche in the marketplace that was, if not unique, particularly well-defined and well-served.{{cn|date=July 2024}}

In the aftermath of the dot-com bubble, telecommunications companies had a great deal of overcapacity as many Internet business clients went bust. That, plus ongoing investment in local cell infrastructure kept connectivity charges low, and helped to make high-speed Internet connectivity more affordable.{{cn|date=December 2023}} During this time, a handful of companies found success developing business models that helped make the World Wide Web a more compelling experience. These include airline booking sites, [[Google]]'s [[search engine]] and its profitable approach to keyword-based advertising,<ref>The new dot com bubble is here: it’s called online advertising – The Correspondent</ref> as well as [[eBay]]'s auction site<ref name="auto1"/> and [[Amazon.com]]'s online department store.<ref name="auto"/> The low price of reaching millions worldwide, and the possibility of selling to or hearing from those people at the same moment when they were reached, promised to overturn established business dogma in advertising, [[mail-order]] sales, [[customer relationship management]], and many more areas. The web was a new [[killer app]]—it could bring together unrelated buyers and sellers in seamless and low-cost ways. Entrepreneurs around the world developed new business models, and ran to their nearest [[venture capitalist]].<ref>Where Are They Now: 17 Dot-Com Bubble Companies And Their Founders (cbinsights.com)</ref> While some of the new entrepreneurs had experience in business and economics, the majority were simply people with ideas, and did not manage the capital influx prudently. Additionally, many dot-com business plans were predicated on the assumption that by using the Internet, they would bypass the distribution channels of existing businesses and therefore not have to compete with them; when the established businesses with strong existing brands developed their own Internet presence, these hopes were shattered, and the newcomers were left attempting to break into markets dominated by larger, more established businesses.<ref>The Dotcom Bubble Burst (2000) (internationalbanker.com)</ref>

The dot-com bubble burst in March 2000, with the technology heavy [[NASDAQ|NASDAQ Composite]] index peaking at 5,048.62 on March 10<ref>{{Cite web |url=http://bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=NASDAQ&close_date=3%2F10%2F00&x=34&y=12 |title=Nasdaq peak of 5,048.62 |access-date=2022-04-15 |archive-date=2017-11-11 |archive-url=https://web.archive.org/web/20171111145523/http://bigcharts.marketwatch.com/historical/default.asp?detect=1&symbol=NASDAQ&close_date=3%2F10%2F00&x=34&y=12 |url-status=live }}</ref> (5,132.52 intraday), more than double its value just a year before. By 2001, the bubble's deflation was running full speed. A majority of the dot-coms had ceased trading, after having burnt through their venture capital and IPO capital, often without ever making a profit. But despite this, the Internet continued to grow, driven by commerce, ever greater amounts of online information, knowledge, [[Social networking service|social networking]] and access by mobile devices.{{citation needed|date=October 2024}}<ref>McCullough, Brian. (2018). ''How the Internet Happened: From Netscape to the iPhone.'' Liverlight Publishing. </ref>