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Dot.Con
But John Cassidy can make no such excuses for Dot.Con: The Greatest Story Ever Sold. Cassidy offers no insight, and even fails to identify the "con" promised by the book's title. And his sloppy writing, riddled with factual and typographical errors, ensures that the book can't be accepted even as a "digest" of the events he reports.
A much better and more insightful book in this category is Michael Lewis' Next: The Future Just Happened An earlier example of a competent "industry chronicle" is Fire in the Valley: The Making of The Personal Computer, by Paul Freiberger and Michael Swaine. For a fascinating account of the "experience" of a dot-com bubble company, read dot.bomb,by J. David Kuo, or watch the movie Startup.com.The book's eight-page prologue was mildly promising, and led me to expect a chonological report of the rise and fall of the "internet industry." I've never read any of Mr. Cassidy's articles, but the book jacket assures that he is "one of the country's leading business journalists" and "has been a staff writer at the New Yorker for six years." My expectations were low: I expected a competent journalist's account of the stock market's dot-com bubble. I was disappointed.
First, the book is riddled with mistakes: obvious typographical errors, embarassing spelling and grammatical mistakes, confusing shifts in time, and bizarre factual errors.Clearly, this book somehow avoided the common year-long delay to publication (Cassidy discusses the impact of the September 11, 2001 terrorist attacks, in a book that reached bookstores during the first week of February 2002). Apparently, time was saved by skipping all proofreading, editing, or fact-checking.
Cassidy's first chapter attempts an impossible yet necessary task: recounting the entire histories of computing, the internet, and the "World Wide Web" in just 16 pages. As I read this section, I was uncomfortable, because too much of what Cassidy wrote seemed incorrect. Then, I was jarredby a glaring mistake: Cassidy wrote that the Altair computer, released in 1975,was named "after a character in Star Wars." (Like most Americans, I saw Star Wars during its first year-long run in theaters in 1977, and I recall no character named "Altair." I do recall references to Altair as a star and solar system in the Star Trek TV series.) Perhaps my training as a journalist and editor make me "more aware" of the book's many spelling and grammaticalerrors,but finding such an obvious factual error on the fifth page of the first chapter made me quite anxious about the reliability of the rest of the book.
A few pages later, Cassidy writes: "In 1978, two Chicago students, Randy Seuss and Ward Christensen, invented the modem...." As a long-time computer geek, I knew this was another mistake: programmers Seuss and Christensen didn't invent the modem (which is a piece of computer hardware). In 1977, Christensen wrote Xmodem, the first computer program used to transfer files between computers equipped with modems; a year later, he teamed with Seuss tocreate the first "bulletin board system" software.
After seeing such obvious mistakes in the book's opening pages, I knew that Dot.Con would not be a reliable account of anything, but I read the book with the hope of gaining some insight into the stock market's dot-com bubble.
Second, the book's chronology keeps shifting: Dot.Con shifts between several modes. Some chapters appear to relate a chronological sequenceof events. Other chapters focus on particularcompanies (Netscape, AOL, Amazon.com).Other chapters focus on broad themes. Unfortunately, even the most "chronological" chapters don't maintain a clear chronology, often including facts and events from earlier or later years.
Often, Cassidy's "factual time-shifting" seems designed to make key events or statementslook even more foolish. But usually, it simply confuses and distracts from the real absurdity.
Finally,the book offers no new insight:Nearly everything I read in Dot.Con, I had read somewhere else before. Indeed, the book's many footnotescredit nearly all of the book's contenttomainstream news articles and other books. The main theme of the book is that the spectacular rise and fall of internet or dot-com companies in the stockmarket was a classic "speculative bubble," no different from earlier absurd bubbles. Buthundreds of critics had been saying that since the mid-1990's (and Cassidy cites many skilled analysts and brokers whose careers were ruined by their refusal to join in the feeding frenzy).
After I finished Dot.Con, I sought to identify a single fact or insight that seemed original to Cassidy, or even some fact or insight that hadn't already been recounted many times before.
I can recall only one notion that I don't recall reading elsewhere:the impact of Adam Smith's concept of"perfect competition" in an age when the internet reduces barriers to entry and removes friction from transactions. Cassidy writes: "In perfect competition, all goods sell at cost, and profits are zero." This insight helps us understand the folly of the recurring theme that because the internet is so big, it's inevitable that internet companies which holda "first mover advantage" or which capture millions of "eyeballs" will somehow earn huge profits from their vast audiences. But Cassidy doesn't seem very committed to this theory.
I expected that a book called "Dot.Con" would name names: who were the con artists, and what were the confidence schemes? Who was really to blame? Cassidy seems to waver, and I'm not sure if he intends to suggest that the dot-com crash was Alan Greenspan's fault, or whether it was the fault of brokerage-firm analysts and of journalists -- he seems to partially blame yet partially acquit each. Or perhaps it was really all just an inevitable "herd mentality" speculative bubble that was really nobody's fault.
Certainly, Cassidy does an able job of reporting that the absurd valuation of internet companies was a major aberration for the analysts and investment bankers. He often repeats that the quest for fees and profits led many investment banks to seek ever-more-absurd valuation strategies, in order to float IPOs for companies with no history of profit or even revenue. Over and over, he recounts the absurd financial figures for companies valued at billions of dollars despite short histories that promise only greater losses and virtually no prospect of profitability. He finds lots of targets for ridicule, but they are all easy targets, and the stories have been reported many times before.
Cassidy never digs below the surface, and he mostly views the rise and fall of dot-com stocks as a single cycle, one giant wave that lifted and then sank. He mostly ignores the flow of different "sub-industries" that may explain why the "bubble" continued for so long with several surges.
He ignores the impact of "buzzword investing" as venture capitalists and investors sought to stay one step ahead. (The buzzwords include: "Internet Service Providers", "e-retailing" or "business-to-consumer," "portals," "business-to-business," "Application Service Providers," and "internet infrastructure," each of which can be viewed as a separate "wave" -- or perhaps as "more hot air" that delayed the collapse of the "bubble.")
Maybe it's too soon for anyone to write a definitive account of "the Internet Mania." And maybe John Cassidy did not want to assign blame, but instead to maintain the role of an impartial reporter of the various events, and the various theories. Whatever he intended, he did a poor job. I don't recommend Dot.Con.
You really can purchase Dot.Con at Fatbrain. If you'd like to praise (or skewer) a book here yourself, it's easy. Just read our book review guidelines, then submit your own review with Slashdot's web interface.
actually put his insight into use?
.con eh?
Remember, barely a year ago any schmoe with a half-baked idea and a little business savvy could get VC. Well, looks like he didn't learn from the
If the shoe fits....
Sent from your iPad.
The name alone should have been a dead giveaway. How much did this book set you back? I think reveiws should include the price.
These dot-bomb books are turning into Sweet Valley High series books. I read the first one, but they are all the same.
Maybe the VC will not have an IPO exit strategy but instead use the book signing as their exit strategy!
I can see it now.... Dot Bomb Vol. XIX, Amazon's rise and fall
I used there email system engine for a year and half. I was always kind of curious how they were generating all that cash flow. I remember at point two of the founders sent out this email exclaiming how really amazed that they were at I think it reach 175 a share. A year later when the crash occured they went down to .85 cents and they were going to move to a smaller building in a warehouse district in nj
It takes a lot of guts to put out a book with such a stupid name.
...if the book is truly pathetic? Not having read the book (and, based on the review, not particularly desiring to), I can't vouch for the review's accuracy. However, it seems reasonable to me that if a book is glaringly erroneous that one would not actually promote its sale by publishing a link for it. Did I miss something?
What is your Slash Rating?
So this book sucked, and thhat looks like the selling point. Every body said it sucked so people bought it just to find out how bad it sucked. IF you lost your pda/laptop/gold chains and teeth crowns cause you dawt com bombed wouldnt you write a book to?
A disappointing, meandering examination of the boom-and-bust world of Internet commerce which doesn't even deliver on the promise of its title by naming names.
.com's. Doesn't deliver on it promise.
So the book is like the
The reviewer has missed the point... the book itself IS the con and the con-tent he's reviewed is just filler.
In another book review some people complained that all slashdot reviews were of books rated 8/10 and similar.
Best Slashdot Co
The "con" was getting you to buy this terrible book and make him millions of dollars, all without doing any sort of research outside of scouring a few news sites!
To quote Dark Helmet from Spaceballs: "Fooled you!"
If the guy writes his name as Mark, please make sure you don't write his name as Marc later on. Its very rude...
I mean, it's at the very least an advertising tracker, and more likely part of an affiliate program... I wonder why exactly people would send their book review in to Slashdot, only to have it be used to feed people through a link (well, maybe not with this review) to put money in VA's pocket. Honestly, I wouldn't mind it so much if the affiliate link wasn't there, or even if the money went to the review's author. Slashdot.com, indeed!
It's good to see a book slashed to pieces every now and then.
it's not enough to know which books to read, but also which ones to avoid.
Also: walk away from any book with a substring "made easy" in the title. For dutch readers I recommend you stay away from any book written by Leen Ammeraal.
no sig error.
[inside cover of book]
Dot.Con
by Stephan Paternot
Editors: CmdrTaco and Roblimo
Dodger_
i was one of the first 10 employees got and fired during the first expansion of the company. i had a strong feeling that the company should have focused on technology - i was told i was "not all there" - and they were there to make money.
you see, they (todd & steph) got a big jumpstart by perfecting chatting over the week and i felt that the only way the could keep up the momentum was to stick with being on the bleeding edge. i was pushing them to do some (oddly enough) p2p stuff; yes this is back in 1996 and i was a big distributed system crackhead (still am). it is interesting to look back because in a way we were both right
1. (they had the short term vision)it was a feeding frenzy and there was money to be made
2. (i was considering the long term vision)you can aways push products if you have the technology - you just have to get business and tech to work together to hash new products.
from my perspective with so much capital very little was done with in terms of what they brought to the great dinner table of computing. yet is it hard to keep a level head when anyone is in that position.
as for me i am happy part of academia and don't plan on leaving anytime soon - think this is where i belong.
as an aside - i really think tech people/business need to slow down a bit and ask themselves if computers were taken away tomorrow would you be doing the same things? for example theglobe did online communities - would theglobe be working to build communities in the real world if they lost computers tomorrow? if the answer is not they you have to ask yourself how in tune (mentally and spirtually) you are with the fundamental problem you are seeking to solve.
keeping it organic tofu 2k
Why are everybody so dead set on beating down a dead horse? Last year, this time, it was all about the new economy, how everything was supposed to be a service, profit didn't matter, old companies were on their way out. And don't tell me it was just CNN-Money that gave that line. Remember a certain gun-toting 'leader', some VA stocks, and a lot of chest beating?
Just glad I never worked for those companies.
Je ne parle pas francais.
If I wanted incorrect facts, innuendo, typos and the real dirt on the DOT CONs, I'll go to www.f---edcompany.com and save my $$$.
There was a rather fascinating program on PBS a few weeks ago entitled "Dot Con". The thesis of the program alleges that investment analysts had an awful lot to gain by offering "hot buy" advice on stocks that their employers had vested interest in.
Ultimately, this led to consumers/investment speculators getting screwed, and unripe companies being shipped off to IPO land for quick cash.
This site has much more detail, including interviews, stats, etc. - including the program itself on quicktime:
http://www.pbs.org/wgbh/pages/frontline/shows/dot- passion
Wow, and the book is being berated for that on SLASHDOT of all places! Oh, the irony!
If you open yourself to the foo, You and foo become one.
Cassidy must have flunked his Econ 101 classes, too. Classical economics posited a long-run equilibrium, where profits are driven down to a stable level. In this environment, profits are not zero (my God, how could an economy survive where everything is sold at cost?), but are as low as possible due to competition.
Like the labor theory of value, this is one of those assumptions of classical economics that didn't bear out in the long term. There are many reasons for this, but the most critical advance in profit theory came from Schumpeter and his theory of "creative destruction."
-Baka!
Whatever the book is about, it's old news folks. Hell, most of us were in the middle of the "dot cons". Either this book is too little too late, or it doesn't apply to us. Kind of like commentary after a sporting event. Please.
--SC
You read fiction? I write it! Lemme know what you th
That was not so much a book review as one long sour grapes session ... in truth this is a very well written book that deserves to be read by a wide audience.
John Cassidy is The New Yorkers' business writer, and I've been reading his weekly column there for some time. He's an insightful writer with a good turn of phrase and an eye for strong themes. And that's what Dot.con is about: why did the US economy get transfixed by a speculative bubble involving the internet? That's the question he's exploring, and it's a complex issue, so readers shouldn't be disappointed (unlike whoever wrote the Slashdot review) if he doesn't come up with black and white answers. It's not that simple, and only a moron would expect it to be. However, Cassidy is pretty plain who he blames for letting the whole circus get out of hand: Alan Greenspan, the media, and the investment banking community. But he has the insight to explain why each of those groups did what they felt they had to do.
It's true there a few typos (mistakes) in the book, and I have no idea who invented the modem and it doesn't matter. From what I can see the guts of the book is accurate, and any (minor) mistakes don't detract from its strength. What Cassidy has done is write an excellent narrative of the financial markets and the internet from 1995 to 2001. As a history of its type it can be compared to JK Galbraith's The Great Crash - and it's no coincidence that Galbraith has been a big fan of the book, supplying a glowing endorsement.
Nothing new in here? Well, it's a history of the very recent past, so lots of the events are very familiar to most readers, but Cassidy's ability to tie it all together makes this better than so many cut-and-paste jobs. And its aimed at the good old general public - the type of people who might have been tempted to buy some Priceline shares because their brother-in-law made big money on the IPO.
Slashdot readers can still enjoy it though, even if it is too general for them: the hubris, the schadenfreude, makes it very enjoyable. Cassidy paces the book so well, almost like a good novelist, that the book has a racy plot. And he focuses in on some key parts of the bubble as it expanded: the chapter on Amazon is particularly good. It doesn't bear any resemblence to Michael Lewis's book: that was written at the top of the "the internet's going to change everything, man" phase, which (as Cassidy points out) turned out to be hyperbole at the very least.
Don't trust whoever wrote Slashdot's review: this book actually stands a good chance of being the standard history of the dotcom boom-and-bust. It's the book that, years from now, when someone asks you, "why did everyone go so crazy about the whole dotcom thing?", you can pull out this book and say: "it's all in here...."
David Kuo worked there for about 6 months and knew just about jack squat about the company. A better account can be had from the founder: In the Company of Good and Evil (ISBN: 0971448108).
If you want to see the inside of how "dot com" falls apart. Watch this movie, it gets long at times but if you've ever worked at one you'll get a feeling of deja vu.
How long before I get e-mails letting me know I should register "yourname.con" before its taken for only $70 a year?
Shown last week was insightful. It mainly focused on the investment banker IPO scam. Historically IPOs waited five years until there was a profit, e.g. AMZN should just being going to market this year. But the dot.craze offered companies with no profit and dubious revenue streams in just a year or two. Investment house analysts hawked these. Supposedly there is a "Chinese wall" separating the investment and broker side of a firm. However these analysts knew heir bonus checks depended on IPO profits.
Support your local congressman... He needs some cash before campaign finance reform kicks in.
One of the more interesting aspects I've read about the dot{bomb,con} phenomena was that, by and large, many of the chief officers of the companies rode them gallantly into failure: despite having huge paper gains as measured by stock values right after the IPO, they held on to those shares even as their companies went into power dives.
From that perspective, the former CEO's and CTO's of the dot.gone companies deserve a little more respect than, say, the former executives of Enron, who finagled with SPE's while selling out stock at high prices.
"Provided by the management for your protection."
Given that the book isn't really about computers or the Internet, but about economics, perhaps a more reliable review might be found in a publication more closely aligned with that subject. "The Economist" gives the book a glowing review (available to subscribers only). Some readers may even find The Economist to be a more learned journal than Slashdot and therefore more likely to deliver a balanced review.
u got ur latter and former mixed up.
The problem is the layman's use of the word 'profit' and the understanding of the concept by economists.
Without getting too technical, the layman thinks of profit as anything above and beyond the cost of manufacture. To the economist, monopolist profit taking means the excess taken over the fair market price.
Also, please read my journal article regarding 'perfect knowledge'. It is a key ingredient to any discussion of 'perfect competition', and one sorely lacking in many/most internet business transactions.
Jesus was all right but his disciples were thick and ordinary. -John Lennon
So a post-mortem analysis on what happened, and why it happened, has no merit? As the old and incredibly wise saying goes, those who fail to learn from history are doomed to repeat it.
I don't vouch for this book whatsoever (haven't read it), but learning from the .COM bubble is extraordinarily valuable, both from a "herd mentality" investing example, and from a "rich get richer" perspective (i.e. a lot of banks and big investors made and kept an incredible amount of money when every average Joe rushed in to free them of those stocks at ridiculously inflated prices, all the while being urged on by "analysts" paraded as impartial while being employed by a company that depends upon boisterous IPOs). The whole system is grossly flawed.
There was a very good PBS special on a couple of weeks ago, and it was very enlightening (at least for me). Of course it, too, was called dot.con, much to the consternation of many on here (I think the slamming of the name is a little ridiculous. It isn't a literal domain name so semantics on whether or not it's redundant are absurd, but putting .CON makes it a tad difficult to find in the card catalog).
--SC
Hey bro, how did the meeting go?
Sorry to hear you couldn't get drunk last night,
but it doesn't matter, you are still a fag.
kisses.
cassidy.con
Simple sanity-checking should have pointed out to him that The Altair(tm) was invented before the Star Wars franchise ever got under steam. Just a bit of googling around would have found him the story he was looking for...
Not for a character from Star Wars, but a planet, from Forbidden Planet.
The planet, too, was named for the star, Alpha Aquilae. but is outside the scope of the movie, the book, and apparently the author's skull.
There's also a persistent rumor (through Google, that may be part of the souce of his confusion) that the computer was named after a character or a planet from a Star Trek episode, but no such episode apparently exists.
It's a strange day indeed, when Slashdot editors find themselves in better stead, for typos and fact-checking than the subjects of their articles, but these be strange days surely.
First, nothing begins if not opening
That was never part of classical econ.
It was part of the commie theory of econ. Which was only believed by ivory tower crackheads and children in the streets.
The dot com boom, and subsequent bust cannot solely be blamed on poor management. Nor can it be blamed on justifiably irrational expectations. (If that is not a contradiction in terms.)
Most importantly, it is not best analysed by those who claim to have been right all along, yet were strangely silent during the period 1997-2000.
The best analyses will come from those who invested and lost their own (not other peoples') money.
Why were so many individual investors (and I include 'angels' here) persuaded that pets.com was worth more than the aggregate market value of all other pet suppliers combined? Why were analysts so vocifiorous in their claims that the net was going to change the face of the economy for ever? (Did anyone ever compare the Internet to previous technology led booms? If so, let them come forward - don't let them crow after remaining silent during the boom years.)
While we have a culture of 'I told you so, just not to your face, or indeed to anyone else at all', then analyses will be flawed and, frankly, self-righteous and arrogant.
I look forward to Mary Meeker's words, and Henrey Blogets's words. (I won't necesserily believe them - but I look forward to reading them.)
My thoughts only,
Robert
--- My dad's political betting
I agree that "this book actually stands a good chance of being the standard history of the dotcom boom-and-bust." That's why I was upset enough to write a review: I expected a "competent journalist's account," but what I got was a book riddled with factual errors -- mistakes that future readers might accept as true and repeat. I also don't think Cassidy really "tied it all together," other than by putting events on pages that all lie within the same binding. He offers no insight, no conclusions, and as I wrote, no real "Con" nor any actual blame for anyone. I think 'history' would be better served by a bound set of internet-boom-and-bust articles from Forbes magazine, or Fortune, or Business Week, since at least the mistakes in a magazine can often be forgiven due to tight deadlines. (FYI, the full, unedited text of this review appears at my own site at http://www.markwelch.com/perspective/dotcon.htm.)
-- http://www.MarkWelch.com/ Pleasanton California
The notion that dot-org means "non-profit" was abandoned several years ago, though it continues to be honored by the majority. Back when Slashdot.org was sold for a bunch of money to Andover.net (see http://news.com.com/2100-1001-227793.html), I was surprised that anyone would take the heat for acquiring a business that "appeared" to be a non-profit. Slashdot.org is now owned by OSDN.com (which is owned by VA Software Corporation). It is NOT a non-profit company, and doesn't pretend to be a non-profit company.
-- http://www.MarkWelch.com/ Pleasanton California
If anyone cares (and I'm sure most do not care), I wrote a review of Dot.Bomb, posted at http://www.markwelch.com/perspective/dot_bomb.htm.
-- http://www.MarkWelch.com/ Pleasanton California
Don't you mean Irrationalexuberance?
And everybody say, Yatta!
Will I retire or break 10K?
I recall Robert X. Cringely talking about "perfect competition" long before the .com bubble.
He said that sites like pricewatch.com and pricescan.com would make competition so fierce, and profits so thin, that nearly everything would become a commodity. Wish I could post a link...
"Reactionaries must be deprived of the right to voice their opinions; only the people have that right." - Mao
The key here is that while the "Star Trek" and "Forbidden Planet" sources are each plausible, the idea that a computer released in 1975 was named after a non-existent "character" in the movie "Star Wars" (which was released in 1977) is a very obvious mistake that MANY readers will notice (okay, maybe only 1%) and the publisher, editor, AND proofreader should be embarrassed for letting it slip through. The other mistakes were failures of fact-checking (which most book publishers no longer do, trusting the authors).
-- http://www.MarkWelch.com/ Pleasanton California
"Hardly used" will not fetch you a better price for your brain.
Once the financial community started moving through a series of "different" business models, the failure of some of the early companies could be blamed on that now-disfavored business model, allowing new funding to pour into the new dot-coms even as some of the older ones were collapsing.
-- http://www.MarkWelch.com/ Pleasanton California
What's really interesting, is that the authors succeeded in persuading me that the evil villains were responsible for destroying Value America -- but I easily concluded that the authors were more evil, and more responsible, than those they blamed.
The authors spent a lot of time and energy blaming the people they hired for problems, and provide just enough detail to prove that those folks were incompetent fools. But the authors deliberately (almost artfully) omit the key information: they blame their "opponents" for buying millions of dollars of newspaper advertising, but they started the campaign and apparently spent even more. They fault their opponents for scheming and lying, but reveal that the authors were also lying and scheming even earlier.
I have written and posted a lengthy review of the book at http://www.markwelch.com/perspective/good_and_evil .htm.
-- http://www.MarkWelch.com/ Pleasanton California
He is going to be on Extension 720 (WGN, 720 am, Chicago) on Tuesday, February 26 at 9pm CST. WGN has a 50,000 watt signal that reaches about a dozen states and half of Canada at night. There is also a Real Audio stream at http://wgnradio.com/listen/index.htm
There will be a call in number given during the show. Otherwise, you can email the show at MiltRosenberg@wgnradio.com
I certainly plan to ask some question about all the typos, poor grammar and factual errors during the show.
In a world that is Free and Open, who needs Windows and Gates?