:ComputerWorld: Are companies banking too much on stock prices?
ComputerWorld: Are companies banking too much on stock prices? Jan 3, 2000, 20 :11 UTC (4 Talkback[s]) (3475 reads) (Other stories by David Moschella)
"Ever since companies like Amazon.com, Yahoo and, more recently, Red Hat
enjoyed their multibillion-dollar IPOs, their most important strategic
challenge has been to conjure up a business model that could possibly
justify their sky-high valuations. Not surprisingly, all three have
decided that hypergrowth is really the only acceptable path forward."
"For example, since there was clearly no way that Amazon could
justify its stock price as a mere seller of books, it actually has had
little choice but to try to turn itself into an online Wal-Mart. Similarly,
would Yahoo shareholders really have tolerated a CEO who was
content to build just a premium search engine? More recently, Red
Hat's purchase of Cygnus Solutions and its consulting services is
evidence of a similar pressure to grow at all costs...."
"You can already see signs of similar risks for today's giants. Many
people I know are tired of messy portals and are relieved to
experience the pure search capability of a site like Google.com.
Similarly, because they now must behave like titans of industry, key
members of the Linux community are already losing some of their
special luster. I've even started to check out Barnesandnoble.com as
a quiet protest of Amazon's cluttered path."
