Ring In The New Year - table - Industry Trend or Event - Statistical Data Included

Industry Standard, The, Jan 15, 2001 by Joshua Hallford

Jan. 1 to 5, 2001 The Internet Economy finally had something to toast when tech stocks rallied briefly during the middle of the week on news of lower interest rates from the Federal Reserve. But the short-lived revival revealed widening cracks in an already battered market. Computer hardware sales dropped 24 percent in December, a key buying time for this core technology sector. Sales were down 0.8 percent overall in 2000, according to research firm PC Data.

The decline in computer sales contributed to a disappointing online shopping season. In the last few weeks of December, measurement firm BizRate.com adjusted its sales-growth expectations downward. A study from Goldman Sachs and PC Data, however, concluded that online retailers reached projected totals and doubled their holiday sales. Forrester Research is tentatively pegging holiday e-commerce sales at $10 billion.

Net workers may resolve to find new jobs, as layoffs hit 1,927 people during the first week of the new year. CMGI-backed online marketing firm Engage said it would ax 550 employees. Embattled e-retailer eToys cut 70 percent of its staff.

Net traffic levels slipped 4 percent, but that was still 21 percent higher than the volume a year ago. Overall site performance slowed 9 percent. Online auction site eBay ground to a halt with a 10-hour site outage Wednesday.

The Internet Economy Index rates the week of Jan. 1 a 4.

LAYOFFS - UP 190%

SHOPPING - DOWN 10%

BUZZ - UP 215%

Herd Psychology. Although up 215 percent this week, the number of Net-related press releases was half that of last year. Fourth-quarter news coverage had a huge dose of bad news, racking up more than 10,000 media references to a recession. That's double the number for any other quarter in 2000, according to media industry newsletter The Myers Report.

ESTIMATED NUMBER OF PRESS RELEASE HEADLINES CONTAINING "INTERNET" OR "WEB" FOR THE WEEK OF JAN. 1.

SOURCE: THE STANDARD, FROM PR NEWSWIRE AND BUSINESS WIRE

STOCKS - UP 3%

Step Away From That Ledge. Internet stocks came roaring back -- for about a day and a half -- when the Federal Reserve unexpectedly cut interest rates by half a point Wednesday. The Nasdaq closed that day up 11 percent. For the week, The Standard 100 index rose 3 percent from the previous one, down 76 percent from levels a year ago.

CLOSING PRICE AS OF JAN. 4. INDEX TRACKS THE PERFORMANCE OF 100 INTERNET-RELATED COMPANIES.

SOURCE: BLOOMBERG

PERFORMANCE - 9% SLOWER

TRAFFIC - DOWN 4%