Newsletters
News & Information for Technology Purchasers NewsFactor Sites:       NewsFactor.com     Enterprise Security Today     CRM Daily     Business Report     Sci-Tech Today  
   
This ad will display for the next 20 seconds. Click for more information, or
Home Enterprise I.T. Cloud Computing Applications Hardware More Topics...
APC Free White Paper
Optimize your network investment &
Enter to win a Samsung Galaxy Note

www.apc.com
Mobile Industry News
Next Generation Data Center Is Here!
Average Rating:
Rate this article:  
Is Silicon Valley Heading Toward Another Tech Bubble?
Is Silicon Valley Heading Toward Another Tech Bubble?

By Chris OBrien
May 5, 2014 9:33AM

    Bookmark and Share
Venture capitalists and entrepreneurs insist that the Silicon Valley tech economy is not in bubble territory. Yes, they misjudged just how fast the Internet would change the world a decade ago and let things get a little bit out of hand. But this time, they say, the revolution of mobile and cloud services justifies big, bold bets.
 



Venture capital rising to levels not seen since 2001. Companies with no profits going public. Billions of dollars being paid for start-ups.

These and other signs that the tech boom may be taking an irrational turn are leading some notable investors to utter the dreaded word "bubble," waking up the ghosts of an era many in Silicon Valley would prefer to keep buried.

Has Silicon Valley once again lost its collective mind?

Hedge fund manager David Einhorn thinks so. "There is a clear consensus that we are witnessing our second tech bubble in 15 years," he warned in a note to his clients last week. "What is uncertain is how much further the bubble can expand, and what might pop it."

Venture capitalists and entrepreneurs insist that the Silicon Valley tech economy is not in bubble territory. Yes, they misjudged just how fast the Internet would change the world a decade ago and let things get a little bit out of hand.

But this time, they say, the revolution of mobile and cloud services justifies big, bold bets. And most of the companies going public are profitable, with real businesses that are transforming the way we live.

To some tech insiders, the region's economy is in a "Goldilocks" moment. Not too hot. Not too cold. Enough of a boom to be just right.

Greg Becker, president and chief executive of Silicon Valley Bank, isn't so sure. "There's absolutely a frothiness out there in certain sectors," he said. "With some of these companies, we've never seen growth rates like this before. How much is that growth worth? What's the value? That's what people are trying to get their arms around."

During the dot-com bubble of 1999 and 2000, Silicon Valley believed the Internet was causing such a rapid revolution that there was ample justification for pumping billions of dollars into half-baked start-ups that went public by the hundreds.

Tech executives insisted there was no bubble -- that it was a "new economy" -- right up to the moment when their hubris drove the region into an economic abyss.

The tech-heavy Nasdaq composite index fell from 5,046.86 to 1,114.11. Silicon Valley saw 200,000 jobs evaporate overnight. But the bubble grew so large that its bursting also dragged the national economy into recession. Silicon Valley was chastened and saw its credibility shredded.

It's taken almost a decade for the region to regain the trust it squandered, particularly with Wall Street and investors. And the valley is eager to show that it has learned all the right lessons. (continued...)

1  |  2  |  3  |  Next Page >

 


© 2014 Los Angeles Times (CA) under contract with NewsEdge. All rights reserved.
 

Tell Us What You Think
Comment:

Name:



APC has an established a reputation for solid products that virtually pay for themselves upon installation. Who has time to spend worrying about system downtime? APC makes it easy for you to focus on business growth instead of business downtime with reliable data center systems and IT solutions. Learn more here.


 Mobile Industry News
1.   Virgin Mobile Offers Custom Plans
2.   Asana Revamps Mobile App
3.   FTC Wants Fix for Mobile Cramming
4.   Rhapsody Hits 2 Million Subscribers
5.   T-Mobile Calls 'BS' on AT&T Promo


advertisement
FTC Wants Fix for Mobile Cramming
Overcharges are 'the perfect scam'.
Average Rating:
U.S. Firms Fish for Growth Overseas
Tech trendsetters are going abroad.
Average Rating:
Competition Spurs Ultra-Fast Internet
Gigabit broadband push is underway.
Average Rating:
Product Information and Resources for Technology You Can Use To Boost Your Business

Network Security Spotlight
New 'Backoff' Malware Slips Undetected into Retail Systems
'Malicious actors' are using a new variety of malware to access consumer payment data remotely through point-of-sale systems, according to a report from the Department of Homeland Security.
 
IBM Beefs Up Identity Intelligence Security Solutions
Big Blue is betting big on identity intelligence. IBM just acquired a private firm with security software to govern user access to apps and data across cloud and on-premise environments.
 
USB Security Flaw Lets Hackers Hijack PCs
Hackers can use the firmware that controls USB functions to take control of computers, say security experts. That means there may be a new class of attack for which there are no defenses.
 

Enterprise Hardware Spotlight
AMD's ARM-Based Opteron Out in $3K Dev Kit
It's dubbed "Seattle" and it's AMD's first 64-bit ARM-based Opteron processor. The low-power chip is being released as part of AMD’s Opteron A1100-series developer kit, and aimed at high-end data center needs.
 
Apple Updates MacBook Pros, Cuts Prices Up to $100
The popular MacBook Pro laptop line just got an update and a price cut of as much as $100. The MacBook Pro with Retina display now includes faster processors and double the memory.
 
Dell, BlackBerry Not Sweating Apple-IBM Alliance
IBM's recent move to partner with Apple to sell iPhones and iPads loaded with corporate applications has excited investors in both companies, but two rivals say they are unperturbed for now.
 

Mobile Technology Spotlight
BlackBerry Messenger Now Available on Windows Phone
BlackBerry's free Messenger chatting and voice app is out of beta and widely available for Windows Phone users, the company said. BBM offers secure messaging, Groups, Voice, Channels and more.
 
Virgin Mobile Offers Custom Smartphone Plans
As the wireless carrier wars continue heating up, Virgin Mobile just threw the customization coal onto the fire. The firm has debuted a no-annual-contract plan with rates based on individual use.
 
Collaboration Provider Asana Revamps Mobile App
Asana, a collaboration software provider started by a Facebook founder, is now out with a rebuilt native iOS mobile app. It replaces one that even the company admits was not up to par.
 

Navigation
NewsFactor Network
Home/Top News | Enterprise I.T. | Cloud Computing | Applications | Hardware | Mobile Tech | Big Data | Communications
World Wide Web | Network Security | Data Storage | CRM Systems | Microsoft/Windows | Apple/Mac | Linux/Open Source | Personal Tech
Press Releases
NewsFactor Network Enterprise I.T. Sites
NewsFactor Technology News | Enterprise Security Today | CRM Daily

NewsFactor Business and Innovation Sites
Sci-Tech Today | NewsFactor Business Report

NewsFactor Services
FreeNewsFeed | Free Newsletters

About NewsFactor Network | How To Contact Us | Article Reprints | Careers @ NewsFactor | Services for PR Pros | Top Tech Wire | How To Advertise

Privacy Policy | Terms of Service
© Copyright 2000-2014 NewsFactor Network. All rights reserved. Article rating technology by Blogowogo. Member of Accuserve Ad Network.