Going solely dot-com simply won’t make it in the revised New Economy, says a new market research study.
In fact, IDC goes so far as to say the purely Internet company, a service model of today, will cease to exist by the end of the year. But this isn’t bad news, according to the market researchers. They say that Internet companies that team with bricks-and-mortar businesses or develop their own expertise in traditional services will be more likely to see tomorrow.
“The pure-play Internet service firm of today will be replaced with a more powerful firm,” says Pooneh Fooladi, senior analyst with IDC’s Internet Services research program. This is because e-commerce is becoming more important and more integrated into every business’s strategy. The dot-coms can play a role in that integration and enjoy new opportunities as a result, Fooladi says.
IDC researchers believe established organizations will turn to Internet service firms for help with online ventures. Traditional businesses may lack Internet know-how, but they sense the “inherent importance” of having such knowledge in their organization, Fooladi says.
Building bricks with clicks
This so-called bricks-and-clicks approach is not without precedent. Traditional businesses have teamed with Internet companies to get up and running technologically during the rush to the Internet. But today, as dot-coms falter, these New Economy companies can look for traditional partners for help with their own survival.
Also, many traditional firms established separate dot-com subsidiaries to explore online opportunities and, in some cases, to take advantage of the hot IPO market, now faltering.
IDC contends that the companies best positioned to capitalize on new e-commerce opportunities will be those with well-diversified offerings that include both technology and business services.