Saturday, November 15, 2008
Tech Slump
"the tech sector finds itself at the mercy of a double-barreled slump in both corporate and consumer spending caused by the housing decline and the economic crisis on Wall Street. Technology companies are also feeling the effect of frozen credit markets as business and government customers struggle to finance computer and software purchases that can run to millions of dollars."
William T. Coleman III, "a Silicon Valley veteran who founded the software maker BEA Systems and is now chief executive at a start-up called Cassatt," is quoted as saying that the industry "never seen anything like this in history." Some are comparing it to the Dot Com crash of 2000.
Despite the downturn, the giants of the tech sector as still flush with cash when compared to Wall Street firms. According to Coleman the difficulties faced by smaller competitors will provide an opportunity for mergers and acquisitions. The big will get bigger and the weak will be consolidated: According to Coleman: “The guys that aren’t as strong will be good pickings."
Labels: digital economy, tech
