OnTheInternet Logo
OTI TextOTI Link

July 2000
Screen Version

Build a Dot Corps, Not just a Dot Com
Madanmohan Rao Interviews George Colony, CEO, Forrester Research

George Colony is the founder and CEO of Massachusetts-based Forrester Research, a leading Internet market research firm. Forrester is now 17 years old and has a presence in more than 15 countries, with primary research centers in Cambridge, Massachusetts; Amsterdam; and London. A graduate of Harvard University, Colony has 19 years of experience as an analyst and is widely quoted in the international business press.

What are your reactions to the Black Friday tech-market crash in the U.S. and its echoes around the world?

I believe that the U.S. tech-market crash was inevitable. Too many companies had gone public too soon in their life cycles. Many business plans were ill informed, management was unseasoned, and competition in some dot com market segments—like pet supplies—was too intense. Now that the detritus is being cleared away, we can get down to building sustainable, well-managed Internet companies.

Which industries do you see as likely to be most challenged by new Internet formats and technologies?

If you sell products which can be reduced to bits—like tickets, music, film, financial services, content, books, magazines, newspapers, money, and TV programming—you are in for a wild ride. I like to play the Main Street game: when I drive down the main drag of any town, I look at every storefront and predict how much longer it will be there. Many of them—the insurance agent, the music store, the bookstore, the newspaper stand—will go the way of the horse-drawn carriage.

What would you rate as the top five things required for a country to succeed in the Internet age?

What are the key impacts the Net has had over the past years in business-to-business [B2B] e-commerce?

The Net has injected efficiency and faster response into supply chains, but most of these changes have been unflashy and behind-the-scenes. The next set of changes will come around pricing—bidding and auction systems slowly replacing the fixed-price mentality in Western nations.

The big change coming in B2B will be what Forrester calls eBusiness Networks—the interconnection of many companies' supply chains to form value-producing networks. Companies will become virtually integrated, not vertically integrated.

What are the top three trends we are likely to see in the realm of mobile Internet access in the coming year?

What role do you see for content alliancing in an e-commerce economy?

Content and commerce are headed for a collision. In the future, the two will be inseparable. You will buy equities at WSJ.com without having to click away to Schwab. The metatrend of convenience will necessitate this merger of content and commerce.

Whom do you view as your competition, and how do you stack up against that competitor?

Our competitor is Jupiter Communications. Jupiter is a well-run, fast-growing company that does a great job in B2C [business-to-consumer] and events. Our strength lies in the whole view of e-business—helping companies meld their technology, e-commerce strategy, and customer connection—the three critical elements of an e-business.

What are the top three misconceptions you notice in the way companies are approaching e-business?

What trends do you see emerging in global governance of the Internet?

Governments are and will remain two to three years behind the curve of technology. So I am doubtful that global governance will get any traction or have any impact on the Internet—at least for the next five years.

What are the obstacles holding back truly broadband Internet access? It always seems to be "just 18 months away."

Physical plant. The wires are too thin, the switching is too archaic, the network is underdeveloped. All of these elements will take years to upgrade.

What kind of growth can we expect to see in the global market for Internet services and application service providers [ASPs]?

In the U.S. market, we expect these markets to accelerate. In 2001, 5 million square feet of hosting will come on line in the U.S.—with more to come in 2001.

How does India fit into your global plans?

We are watching India very carefully. Our plans for being in the Indian market are still in the development stages. India will be highly significant because of its large supply of high-IQ business and technology people. But for the market to truly develop, those managers and leaders have to stay in India—not move to greener pastures in the U.S.

Any other thoughts, comments, or advice to Internet professionals and entrepreneurs around the world?

Want to make a lot of money? Watch what is happening in the U.S., and regionalize those business models to fit your markets. And don't get too greedy! There's still lots and lots of time to build a great business. Build a company to last, not to flip.

About the Author: Madanmohan Rao

Join the Internet Society today: http://www.isoc.org