Companies based primarily on the internet have become "stabilised" in
recent years as more clearly defined business models have been
established, according to one industry expert.
John Clarke, an analyst for the investment firm Brewin Dolphin,
insists that there is now a considerably more accurate understanding
of how the internet can used by companies to increase their revenues.
In the past, notably during the so-called dotcom boom, certain sectors
of industry were guilty of overestimating just how lucrative internet
advertising could be, Mr Clarke maintains.
"The market has become better at recognising what the internet is: a
speedy mechanism for delivering content, whether it's entertainment
content, news content or information content," he said.
"If you're talking about companies that have become absolutely massive
through the internet, like Google or Yahoo or Amazon or eBay... their
models have stabilised and the boundaries between those have been
broadly understood and set," he added.
A report in the International Herald Tribune noted recently that
despite generating eight times more revenue than Google, IBM's
business is actually worth less than the internet search engine giant.
