Biznes dlya Vsekh (Moscow).- 03.06.2002.- 011.- P.12-13

After crisis

Right after 'the Internet crisis' of 2000, the tone of the majority of commentaries in Russian media was like: "the soap bubble burst, the drowning hi-tech will pull along the 'old' American economy, it will not benefit Russia, and 'we told you' after all".

Optimists were speaking like the characters of the old Aibolit-66 movie: "It is even good that we feel bad now". They said that business built on overestimated expectations and exchange rates artificially 'warmed up' by interested traders, had collapsed. This means that the time has come for real projects based on real business models, and from now on their estimation will be based not on a mythical 'traffic' and even not on the expected capitalization, but on strictly grounded "deferred incomes". The main key to an investor's heart is again good old cash flow.

However, let's have a closer look at the situation to find the truth out there in the middle, as usual. This collapse is mainly American. In my opinion, it is linked to the peculiarities of the American investment market. It is well-known that our drawbacks are the sequel of our virtues. Much was said about the openness of this market, about the fact that the lion share of "free cash" went through the developed mechanisms of public placement (unit trusts, IPOs) and that was how the national economy managed to use all the investment resources, from 'the first national bank' to the undistributed profits of transnational oil companies, with maximum efficiency. But one cannot argue that it is this openness that makes the market vulnerable to MMM-like schemes.

The sharks of the international IT business realized this pretty well and devoted the period of 1998-1999 to large-scale processing of public opinion. This is exactly when 'the mythology' of the new economy was formed, all those В2В, В2С, G2B patterns, and the full selection of e-symbols - e-commerce, e-procurement, e-consulting, and so on, and so forth. The permit to a wonderful tomorrow, and consequently - to the exchange, was classifying oneself to the '.com' category. Even all the PR-actions in Moscow poorly disguised as seminars, served the citation that soon any business either would be on the Internet or would not be at all, as a compulsory dish. The author of the citation was the second person in an international IT corporation of the Great Three.

And the wheel started spinning faster. Investors got loaded with citation and wanted more '.coms' Their brokers took their wishes into account and created conditions for the growth of the corresponding stocks in order to further persuade less advanced clients using real figures received after calculating yields. In the mind of a mass market participant, the expectations connected with profits, started being substituted with expectations connected with capitalization growth. The simplest formula you know like the back of your hand is 'THIS is to be bought today because tomorrow you will be able to sell it for much more'. And are they that important, those niceties, which differ the history of the glamour and poverty of the Internet from Mr. Mavrodi's pyramids?

I guess, throughout all this carnival, the largest IT-corporations managed to collect funds for their own development and for the implementation of their new projects. Newly-created Internet brands do not seem to have used their incomes that reasonably, which is confirmed by the dismal statistics of bankruptcies and sacking in the sector of 'the new economy'. But this is the 'battle site picture' of our antipodes. What about us? As for the events, which had wide public response, it was only the netBridge-Port.Ru merger accompanied by 'mass' dismissals amounting to 'as much as' 76 people. Here we should mention that this is about the companies, which not only got American investments, bit also were created thanks to them and for exploring them. It is even more about netBridge. Yandex got American funds when it became a significant participant of RuNet, and I know nothing about any upheavals in the company. RBC had to restructure the non-profitable part of its business to a certain extent, but this was a normal reaction to market fluctuations. It may sound like a paradox, but the absence of the open market makes mostly Russian (regarding capital structure) Internet companies more protected from crisis as compared to their American colleagues. If there are no objective indicators of decay, there is no negative public response either. People do not lose money at the exchange; companies do not suffer losses from decrease in capitalization.

Another of last year's trends is a partial or full conversion of former Internet companies into off-line projects. The Fifth Russian Internet Forum (RIF-2001) took place in the air of 'offshore programming'. The media and advertisers started discussing the services of system integration and creating corporate information systems (KIS) again. The lists of recruitment agencies included long-forgotten specialists in ERP- and CRM-systems. There was an impression that the Internet would enter history only due to its special programming and page layout languages and a specific network protocol of data exchange. And the most effective use of the latter in the terms economy is in local networks. 'The new information environment' and, moreover, 'the new economy', did not come about yet.