Dot Com Boom Annotated Bibliography

Dot Com Boom Annotated Bibliography Lecuyer, C. (2006). Making Silicon Valley: Innovation and the growth of high tech, 1930-1970. Cambridge, MA: MIT Press. This book illustrates the history of Silicon Valley. Lecuyer places the rise of Silicon Valley in historical context. He explains the antecedents of the Valley's emphasis on technology as being from the presence of Stanford University's research and teaching programs and on military patronage. This book is essential to the paper because it places Silicon Valley and its culture as aligned closely with the development of California.

The author takes an approach borrowed from microeconomics and strategic management, illustrating how the Valley grew into prominence as the world's largest and most diversified center of technology talent. The book provides significant historical background for my work and helps to place the dot com boom and bust in its historical context. Okin, J.R. (2005). The technology revolution: The not-for-dummies guide to the impact, perils and promise of the Internet. Winter Harbor, ME: Ironbound Press. Okin writes from a technology standpoint, explaining first different aspects of technology and the Internet.

This segues into a section devoted to the dot-com boom and bust, which serves to underline the book's fundamental points about the promise and perils of technology in the modern world. This section helps to place the dot com boom in technological perspective, illustrating what these companies meant in the grand scheme of technological development. This in turn helped to underscore some of the theories about why dot com mania went through a boom and bust cycle. Welfens, P. (2002). Interneteconomics.net. New York: Springer.

Welfens examines the Internet from an economic perspective. The argument is made that the Internet and rapid shift in telecommunications usage patterns offer tremendous economic benefit to the world, and are changing the ways in which people do business and interact. This book does not address the dot-com boom specifically but it underscores much of the optimism that fuelled the boom. It was useful to see the economics behind the boom and understand why so many became so excited about products and ventures about which they knew little. Zook, M. (2005).

The geography of the Internet industry: Venture capital, dot-coms and local knowledge. Malden, MA: Blackwell Publishing. Zook's book focuses on some of the features of the Silicon Valley business environment that allowed the dot coms to flourish. The role of venture capitalists in particular is explored. This is a key area of research in the book because it addresses one of the key underlying reasons for the boom, and explains the development of the venture capital business in the Valley. Evans, L. (2003). Why the bubble burst: U.S.

stock market performance since 1982. Northampton, MA: Edward Elgar Publishing. Evans uses the dot com bubble and stock market activity for several years previous to explain the concept of a bubble and from where the American investor's infatuation with spectacular stock market returns comes. There is a strong component of financial and economic explanation in the book that illustrates how the bubble came to be from the microeconomic perspective of individual investors. This book was useful in explaining some of the market psychology behind the bubble and its subsequent burst.

Overview In some ways, the dot com boom is a microcosm of California's history. A state whose fame and fortune began with a Gold Rush once again ushered in a wave of prospectors seeking their wealth. This time, the lucre of choice was the Internet, the new technology that was set to revolutionize every aspect of our lives. The epicenter for the dot-com boom was in Silicon Valley.

Silicon Valley, located at the south end of the San Francisco Bay, saw its foundations as a technology hub laid during the Cold War era, when Stanford University's dean of engineering, Frederick Terman, built research groups with the help of military patronage, and convinced major corporations to set up in the area. Terman also encouraged his own engineering graduates to set up companies in the area, fostering the spirit of Silicon Valley entrepreneurialism early in its history (Lecuyer, 2006).

The Valley originally developed as a producer of electronic components, but eventually moved into integrated circuits, computers and finally software and Internet businesses. Along the way, the Valley gradually saw a downshift in the emphasis on military spending and became more entrepreneurial and consumer-driven in nature. By the early 1990s, Silicon Valley was already a hotbed of technology companies, with firms such as National Semiconductor, Hewlett Packard, Apple, Intel, Oracle, Sun Microsystems, Atari and a host of others already established in the area.

The Internet began to rise in the early part of the decade, but the major landmark was the launch of the Netscape Navigator, the pioneering Internet browser. This, combined with significant infrastructure investments on the part of telecommunications companies, helped to drive the rapid growth of the Internet through the 1990s. Already in the mid1990s, companies in the Valley and beyond were beginning to exploit the commercial value of the Internet. By 1995, future giants such as eBay and Amazon had been established.

The early successes of these and other pioneering Internet firms hinted at the commercial viability of the Internet. Investors noted that the opportunity to buy a future global giant at IPO pricing, or near to it, was a rare opportunity. This fueled demand for stock in Internet companies. Although the business models for most Internet companies were unproven, investors were not willing to wait, fearing that it would be too late to buy in once the companies were profitable. Adding fuel to the fire was the venture capital community.

The venture capital business was well-established in the Silicon Valley, as the cluster of strong technology companies and their offshoots had attracted venture capital groups, who then developed a strong knowledge of the local community and its players. This intersected with a strong demand for Internet stocks and the venture capitalists began to pump money into any Internet venture they could find, with the expectation that they could then take that firm to an IPO and recoup their investment at a tidy profit, quickly.

The dot-com boom fueled tremendous growth in the area as well. The local economy burgeoned as investor money poured into the area, creating high paying jobs, growth opportunities and a source of business for non-tech entrepreneurs. Property values increased and the economic climate became one of unbridled optimism, where money kept coming into the region, fuelling startups both viable and not, in addition to increases in home values and other economic spinoffs.

The peak of the dot com era came in 1998 and 1999, when virtually any Internet company could easily obtain substantial venture capital financing and go to IPO, sometimes without having made any money at all. While the dot-com bubble had been launched on the success of firms that had strong business models and would eventually become giants, many of the new firms were created seemingly for the sole purpose of attracting capital. The easy money provided little incentive to work hard. Companies began throwing money away on frills and frivolities.

Firms began to.