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The Tech Report: I’m A Loser, Baby

Five Silicon Alley Big Ideas that went bust.

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Plenty of new-media projects come and go, but there have been surprisingly few major disasters in Silicon Alley (yet). “We just don’t have the money to make really big fools of ourselves,” says one Alley worker who has had his scares. “It really takes a lot of VC venture capital money for a three-alarm fire, because you can be shielded from the market for so long.” Still, if the following five casualties are any indication, the higher the profile, the harder the fall.

1. THEEASTVILLAGE.COM, a “cybersoap” launched in March 1996, was a Rent-like drama hosted by Time Warner’s Pathfinder. But downloading problems (the site was graphics-intensive) and viewer boredom quickly set in. Marinex Multimedia, the ill-fated cybersoap’s producer, shut down last year.

2. Michael Wolff’s YOUR PERSONAL NET site and companion book series was supposed to help make sense of the Web by pointing users to the best sites for things like personal finance, shopping, and sports. But then the big boys, like Yahoo and Excite, decided to do pretty much the same thing (minus the books) with their sites. Investors got impatient and pushed Wolff out last April. Now Wolff’s set to publish a tell-all account of his crash-and-burn this June. (No word yet on whether there’ll be a companion Website.)

3. IFUSION was one of the first big “push”-technology companies (content was going to be delivered right to PC desktops, making the browser obsolete), and it quickly became everybody’s darling (Prudential Securities invested $10 million). But, as one Alley watcher observes, “what no one realized was that push was a technology; it wasn’t a business. After spending lavishly on offices and trade-show demos, the company filed for bankruptcy in March 1997. Last summer, a company called AirMedia bought IFusion for $250,000.

4. As the Web took off, the tide began to turn against CD-roms as the interactive medium for the masses. Yet interactive guru Bob Stein’s VOYAGER forged ahead, producing high-quality niche titles (like “The Beat Experience,” done in conjunction with the Whitney’s “Beat Culture” exhibition) that in most cases were destined never to earn back their sky-high production costs. Corporate infighting ensued, and in December, the company was carved up and sold off.

5. In the early days of Silicon Alley, PRODIGY’s mighty Ed Bennett scoured the city for content (including SonicNet, now owned by TCI, and the Webzine Stim) for the ailing online service. The idea, apparently, was that Prodigy was going to be a sort of hipster headquarters for Web-content geniuses -- but much of the content never caught on and Prodigy stalled while America Online grabbed market share. Now Prodigy’s set its sights on being a mere Internet service provider.


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