Although the Economist is right when it says:
>Billions of dollars have been lost betting on the idea that the internet
>would quickly change everything from retailing to entertainment. Internet
>usage has continued to grow, but most dotcoms have failed, and the
>telecommunications industry, which raced to build the infrastructure for
>cyberspace, is staggering under $1 trillion of debt. Yet it would be wrong
>to conclude that this is the end of the internet revolution. Boom and bust
>often follow the introduction of radically new technologies. In the 1870s
>America's railroad industry boomed in much the same way as the world's
>telecoms industry in the late 1990s, only to collapse in a similar heap of
>bankruptcies, accounting scandals, stockmarket losses and enormous debts.
>America's economy fell into recession.
>
>A few years later, a reviving economy together with advances in railway
>engineering triggered a new wave of investment. Railroads quickly revived,
>changing American business forever. The same sort of thing happened when
>the internal combustion engine came along. In the first few years of the
>20th century there were thousands of people tinkering with carmaking, most
>of whom went bust. A decade later only a handful survived, but the car was
>about to become the icon of progress.
>
>The reason to think that the internet revolution will not only resume but
>accelerate is that advances in its underlying technologies show no signs
>of slowing down.
it is wrong not to advise that any renewed expansion of investment in the digital technology is vulnerable to further waves of destruction of capital. Even if the internet comes to occupy a rising relative portion of the total social capital.
Chris Burford
London