Tim Koogle, CEO of Yahoo! is sure to draw a crowd, regardless of the state of the Internet economy. He is the leader of one of the most successful Internet ventures of this era and if anyone should know how to kick off an event like Cyberposium it is he. I was curious to see how the change that has occurred at HBS, the lowering of the Internet fever, would affect our largest campus conference. I sat in Burden and waited for Mr. Koogle to begin his address.
The past year has been sobering. It is like we are just waking up after throwing this huge party and we remember, sheepishly, taking off our clothes and dancing on the tables in full revelry. We feel somewhat ashamed of our audacity and we wonder if there was something wrong in the way that we celebrated or if anyone will remember how silly we acted. But maybe it is as Paul Deninger, CEO of Broadview would advise in the next panel — just because we have a hangover, doesn’t mean we should be sorry we drank in the first place.
So I sat and waited, both literally and figuratively to see what would happen. I hoped that Tim Koogle would let me know. Host Alex Stirling mentioned in his introduction that last year Jeff Bezos had said something like, ‘you ain’t seen nothin’ yet, baby,’ with regard to the Internet economy. He was right, but not so much in the way that he had intended or we expected. Things have changed drastically, the fall just as swift and brutal as the rise that took so many companies, VCs, employees and shareholders by storm.
Tim Koogle, as many others throughout the conference would do, took a pot shot at investment banking. He said something to the effect of ‘hopefully you won’t all go into banking, hopefully, you go into real business.’ I laughed along with the rest of the crowd, but also felt the chuckle slip slowly into self-consciousness knowing that my classmates who are going into banking already have jobs, signing bonuses and the summer off.
The murmuring of my neighbors told me that much of the content of Tim Koogle’s presentation about the state of the Internet was a bit basic for the audience he was addressing. The ideas that the Internet is global, removes time and geographical barriers, lowers distribution constraints and is interactive are ones that we have all heard before. He also heralded the notion that the Internet is changing people’s lives, a phrase that brings back memories of the early days when the news and magazines brought us stories of connections being made, medical miracles and long lost loves reunited all because of the Internet.
There is no doubt that what Mr. Koogle said is true. The Internet has changed our lives, it is essential and business will never be the same again, but now we have to clean up the mess that was made instead of focusing too much on what a fun party it was. We may have to admit to ourselves that we got carried away in an industry that said technology first, revenue later. What struck me as more important was the latter part of his talk when he spoke about consolidation being a natural part of the evolution of an industry. The process has taken us somewhat off guard because everything has happened so fast. The cycle has been much faster than anyone expected, he explained, which begs the phrase, at Internet speed. This is when it gets interesting… And that appears to be true. A theme that emerged throughout the conference was that now is the time when the real work gets done. Businesses that are strong and management that is committed will shake out and survive the downturn. The costs are great however and we should not overlook the piles of trash bags out back in the yard.
Compared to last year, it was hard to be keynote speaker for Cyberposium. The energy was completely different, but overall the conference was amazing. The number of senior management on subjects as diverse as the future of entertainment to education to data storage was astounding. In the end, what I felt like I was being told by everyone in not so many words is that the Internet is not very different from other industries. We used to say that the Internet was changing everything about how business was done. Many business fundamentals have been ignored for the past few years. The business school basics are back.