Rat's Survival Alternatives
Now that the BOTTOM is "IN"

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By teamann
August 9, 2002

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Now that the bottom is in, I'd like to refresh everyone's memory about how great things can get. Remember at the peak when Microsoft's market cap crossed the half trillion mark? It was a race to see what company was gonna hit a trillion dollars in market cap first! In tech, there were the big Gorilla's that were Making the rules, barreling through the market like thunderous monsters. The internet was growing so fast, there was not enough fiber in the ground to carry all the data, web hosting stations were being set up all over the place to keep up with all the new websites being created. Everyone was gonna need a website. The bottlenecks on the Internet were so severe, we needed to cache closer to the source to keep everything moving. New routers were being designed with tiny mirrors to make them all optical, and the last mile was the prize to be had.

All the talk was being done over wireless, and soon we would be driving in our cars surfing the net without any wires. Spectrum was being bought up at exorbitant prices to meet the demand, and telco's were in a feverish rush to capture the burgeoning customer base. Qualcom was heading in a big hurry to be a 1000 bucks a share while the B2B marketplace was gonna be two trillion in just a few years. Businesses were gonna streamline their IT departments to track supplies in the supply chain, manage customer resources, strip the manufacturing pipeline down to just a few days, sell everything on the internet including books, and do it all faster and cheaper. What happened?

Large Cap Gorillas, 100 billion and above in Market Cap back then...and where we are now.

MSFT      500B      247B
CSCO      470B       88B
INTC      398B      114B      
NOK       253B       54B
ORCL      211B       51B
SUNW      171B       12B
NT        164B        3B     
AOL       141B       44B
EMC       119B       14B
DELL      118B       63B 

Remember? Look at these now. I'll just point out some of the obvious things that stick out like sore thumbs to me. I'm sure you'll also see some things that are amazingly incredulous. Notice how Microsoft's market cap has been cut in half and yet they are still head over heels way above it's peers in market cap. More haircuts to come? Look how Cisco got taken down, from a 470 billion to 88 billion. Apparently the need for storage on the network wasn't as big as we thought; EMC and SUNW really got haircuts. NT is toast. AOL, from 140 billion to 44 billion. Who said it was a steal at 20 a share a while back?

25 to 100 Billion

JDSU      99.7B      3.5B     Ouch
QCOM      93B        24B
YHOO      83B        6.8B
AMAT      73.5B      22B
SNRA      64B        4B       Geez
VRTS      57.6B      6.5B
PCS       50B        3B
BRCM      48B        4.5B
CMGI      32.9B      153M     Oh my
ARBA      31.7B      663M
NTAP      30.4B      2.6B
SEBL      28.6B      4B
PMCS      27B        1.4B
EXDS      26.9B      Bankrupt
ITWO      26.2B      340M
VRSN      25.4B      1.5B
INSP      25B        148M     Is this a typo?

Can you believe some of these that were approaching the hundred billion-market caps? How can JDSU go from almost a hundred billion down to three billion? Sonora was 64 billion? Gee, how did that happen? Look at SEBL decimated. I guess we can manage our customers' just fine thank you very much. Infospace was 25 billion and is now a hundred some million? Didn't they buy Paul Allen's Go Net or something for a couple billion? Also, this tells you who is left standing. Can you see who they are? Who will survive the shakeout?

15-25 billion market cap

AKAM      24B      123M       Wow
BVSN      21B      Bankrupt
BEAS      20B      2.2B
CNXT      18.9B    434M
INKT      17.5B     69M
FDRY      17.2B    917M
BRCD      17B      3.8B
CMRC      17B      112M
ARMHY    16.3B     2.2B
AMCC      16B      1.4B

Broadvision? Do you remember what their vision was? How broad it was? 21 billion worth of vision? Now that B2B marketplace Commerce One? 17 billion down to almost nothing. It won't make it I'm pretty sure.

15-10 billion market cap

SDLI      15.6B      Merged with JDSU
VIGN      15.6B      355M
RFMD      14B        903M 
ATHM      12B      Bankrupt
DCLK      11.5B      653M
QLGC      11.4B      3.5B
RNWK      10.4B      619M

Ah, ATHM, the broadband story. Bankrupt. Remember Corvis, the all-optical switch that came public at 15 billion and ran to 20 billion in a few days? Where are they now? Oh yea, they can't tell their shareholders about the new switch. It's top secret. Stock is now 200 million.

So, next time someone says we are living a new paradigm (someone unlike myself) and that the growth can continue, think again. Think for yourself and don't believe what you read on message boards or in the news.

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