Unfazed by Y2K, the Web grows up

Got a spare mainframe kicking around, or some extra capacity on old Unix servers? If you do, why not Web-size them and distribute your company's vital business applications over an intranet?

Got a spare mainframe kicking around, or some extra capacity on old Unix servers? If you do, why not Web-size them and distribute your company's vital business applications over an intranet?

By John Dodge, PC Week
12 March 2000

That's what two AT&T employees did, operating on a US$150,000 capital budget—chump change by AT&T standards. There's probably a vending machine at AT&T headquarters that generates more sales in a week than what these two guys had to spend on the "Simplog" intranet.

$TB_QUESTION="Are you seeing all that pent-up demand created by Y2K lock-down? And do you know anyone using Win 2000 Professional yet?"; include($DOCUMENT_ROOT."/templates/talkback_box.htm"); ?> Their accomplishment says two things: With perseverance and creativity, you can still get things done inside a huge corporation; and when it comes to the Web, you can do great things on a shoestring, even when prevailing wisdom suggests that sitting tight is the most prudent course.

Let's just look at getting the necessary server capacity. You might be a little light on excess server midrange and mainframe capacity. There was a burst of acquisition activity early last year, but when the Y2K lock-down took hold around June, midrange and high-end sales tanked. So you've probably used up any excess capacity. International Data Corp. defines "midrange" and "high end" (a k a mainframes) as servers costing US$100,000 to US$999,999 and US$1 million or more, respectively.

Conversely, PC server sales (less than US$25,000) and entry server sales (US$25,001 to US$99,999) soared in 1999, seemingly oblivious to the Y2K lock-down. PC sales registered 26.3 percent growth, generating US$17.3 billion in sales, according to IDC. That compares with 8 percent revenue growth from 1998 to 1999. Entry server revenue grew 10 percent, to US$26 billion.

It's no surprise that e-commerce and intranets (even though Simplog resides on mainframes and older Unix servers) fueled the growth of entry and PC-based servers last year. Without the Y2K scare, the entry and PC numbers would have been stratospheric.

So-called "New Economy" companies and Web projects seem just as insulated from anomalies such as Y2K as their share prices are from the usual stock market influences, such as interest rates and gas prices.

A recent PC Week cover story on analyzing Web data shows the Web is growing up. E-commerce's future belongs to companies that can incisively analyze gobs of data. Sophisticated personalization and content management are also part of the equation in both the business-to-consumer and business-to-business market segments (conducting transactions is simply a given).

The story suggests that the pressure is on from business managers, as well as venture capitalists backing freshly minted dot-coms, for insights into who's doing what on the Web site—and using that intelligence to cultivate customers and drive profit.

Does this suggest a departure from the days when venture capitalists backed anything with a dot-com in its name? The idea of "profit" and "dot-com" used in the same sentence is, well, preposterous! Brand building is the name of the game. Or should I say "was"?

Is the dot-com emphasis edging toward metrics and profits? Slowly, if at all. No dot-com I know is reporting healthy profits.

However, the endgame will be won by the companies that can best read individuals' minds to deliver what they want before they realize they want it. It's possible that someday a Web site will consider it a defeat if consumers had to proactively find a product on their own.