So the first prediction I will make is a purely personal one and more of a promise than a prediction: 2009 will be a year when more new postings will emerge from TNL.net.
I do not share the optimism of many other people in the technology field when it comes to macro-economic factors and their impact on the technology field. My view is that the first half of 2009 will be much worse than the last half of 2008 and that the second half of the year will, at best, look like the first half of last year.
I suspect that the financial picture will get more constrained over the next fiew months as banks start feeling the impact of a consumer-led credit card crisis as individuals try to save their houses by maxing out the credit card instead and eventually reach the end of the credit limit, unable to repay.
In the broader economy, the current credit crunch will continue to have an impact on all industry and I suspect this will lead to large companies first encouraging voluntary layoffs, followed by further job cuts. This will translate into a larger impact on the retail sector, which is still larger than it ought to be under the current condition. Expect more consolidation in retail, with some large players closing shop altogether.
I don’t think it’s very hard to predict a wave of start-up failures this year. However, this will not be anywhere near as bad as it was during the first dotcom bubble because the current crash is not seeing inflated VC investments as its core. The level of investments in web 2.0 companies never reached the excesses we saw during web 1.0 so I suspect that many start-ups will float away with more of a wimper than a bang.
Established Web Players
Some of the more established web 1.0 companies will have a rough year.
I would not be surprised to see Yahoo no longer running as an independent firm by year end. My suspicion is that it will either be combined with AOL as part of a complex transaction that will spin AOL out of Time-Warner and combine with Yahoo (a combination that I suspect will leave all involved hopeful for the best at the start of the transaction and disenchanted with the result by year end) or, should the stock price drop lower, I would not be overly surprised if Rupert Murdoch were to swoop in and pick it up to combine Yahoo with other News Corp. Interactive properties (including MySpace).
eBay is another company that will have a rough year in 2009. Much attention will be paid to it as Meg Whitman, the company’s former CEO makes a gubernatorial bid in California and many will point to her leadership there as either an example of success or failure, depending on which side of the political spectrum they stand on. Meanwhile, eBay’s auction business will continue to crater and more of its revenue will come from its PayPal and Skype subsidiaries.
Amazon will survive the retail downturn and may actually emerge as a winner in the category. As more retail consolidates, Amazon’s rich data-mining abilities are making it the Wal-Mart of the online world and I expect it to see growth in the retail space as smaller players fall off by the wayside. Furthermore, its diversification, with the company also offering some of its infrastructure via web services for a low fee will pay off as more startups will move their operations to the Amazon cloud as part of some cost savings efforts.
Meanwhile, Microsoft will continue to sputter along in the online space, possibly picking up the search business from Yahoo but ultimately ending the year without any significant gains in the online space. Hopefully, by then they will have released Windows 7, which may undo some of the reputational damage the company suffered after the release of Windows Vista.
In the next entry, we’ll look at the media space and how those macro-economic changes will have an impact on that.