While many of the species that inhabited that environment are proving unable to survive outside the hothouse, others seem to be thriving. In addition to the city's more than two dozen tech-oriented venture-capital funds, incubators, accelerators, expediters, and hurry-it-uppers geared toward newborn companies, New York now has lawyers wise in the ways of speed-drafting equity agreements, overnight marketing partnerships, and acquisition documents -- and willing, perhaps, to accept shares in lieu of cash. Serious software engineers, who used to barely journey beyond the confines of Wall Street, left their investment banks to get a piece of the dot-com boom; others emigrated from the West Coast and stayed because they (like so many before them) found the city to be a productive place to do business and an exciting place to live. "People in New York are smarter than they are in California," says the recently transplanted CTO of a local start-up. "I'm very happy to be here. Silicon Valley is just dense with geeks."

For hard evidence of the Alley's hidden vitality, check out the Real Estate section of the Sunday Times. According to Kenneth Salzman, director of Newmark Realty's IT practice, "Midtown South is currently the tightest market in the city," with Flatiron-district space averaging more than $40 a square foot, up from $30 just a year ago. Salzman (himself a Net mogul, having founded and sold Globix, a publicly traded ISP) sees that rise continuing, if at a less-heady pace, because he expects demand from start-ups will continue unabated.

"For access to capital and labor, small-space users need to stay in New York City," says Salzman. "That's why there's been almost immediate absorption of available space," even in far-west and northwest Chelsea. And while dying dot-coms occasionally furnish the market with less-expensive sublets, just as typical is what happened with the office space at 195 Broadway that Bolt.com leased and then reneged on before even moving in: Morgan Stanley sucked it up instantaneously, and at a higher rate.

When the monetary pipes do unclog, where will the liquidity flow? Ask a sampling of Alley savants, and a few ideas keep coming up.

The No. 1 answer by far these days is wireless and mobile -- a broad area covering anything to do with cell phones, Palm-type devices, and portable Net access. New York has two important advantages that could let it surpass Northern California as the hub of this emerging industry.

"Culturally, we're meeting our Old Economy clients in the middle. I used go to meetings and I'd be the wacky Web guy. Now they've dressed down to our level."

The first is the region's historic strength in telecom science, the technical underpinning of phone-related companies. "New York City is within 50 miles of AT&T, Lucent, Bell Labs; NEC's lab is in New Jersey; IBM is in Yorktown Heights," Bennahum points out. "The Eastern Seaboard right around here has more of that stuff than Silicon Valley." The second is Wall Street, the mother lode of early wireless adopters. "The first people to buy this stuff are financial-services guys," says Josh Newman, editor of Unstrung, the New York-based wireless-industry Webzine. "Joe Investment Banker is standing on the sidelines of his kid's soccer game using some cool app, and then his neighbor sees it and that's how it spreads." Unstrung (which is owned by SkyScout, itself a wireless-data-services hopeful) launched in March and is quickly becoming the wireless biz's answer to the Silicon Alley Reporter. "Because you're constantly dealing with giant corporations in this field, though, there's a lot less personality-driven stuff in Unstrung than in SAR," claims Newman, with none of SAR founder Jason Calacanis's self-promotional flair.

So far, the biggest hit in Unstrung's sector is Vindigo, the company whose city-guide software loads onto Palm Handhelds and, soon, phones and other pocket-sized devices. With 260,000 users in its first nine months and the Palm population set to double again to 20 million users next year, Vindigo plans to license its platform for organizing information by the user's location to content providers worldwide. Helping Vindigo develop its technology for the phone market is West 35th Street's Vettro, which raised $12 million this fall -- a very healthy first round in so tight a market. Eventually, Vettro CEO Rodger Desai wants to be the IBM of wireless -- selling expert consulting services (many Vettro staff members have worked in the more advanced European and Japanese wireless industries) along with house-blend software and other technology products.

Another wireless start-up, Outercurve, still shacked up in its West Village incubator's offices, is playing exclusively to the financial set. It delivers wireless stock quotes, charts, options chains, and other financial news to a Blackberry (the current must-have wireless handheld gadget) for about $100 a month. To court a more general-interest audience, Upoc is getting a lot of attention for its group-messaging application, which it's promoting as a way to report celebrity sightings to all your friends at once.

Perhaps more surprising than the buzzing wireless scene -- which at least resembles the media and content companies that made up the Alley's first generation -- is the city's increasing number of pure infotech firms. Take, for example, DataSynapse, a red-hot prospect in the utterly geeky field of distributed computing. DataSynapse has created a secure way for processor-hungry companies (for example, multinational banks that need to crunch numbers overnight) to broker computing power from anyone with an idle broadband Net connection. CEO Peter Lee is initially targeting the world's top 500 financial institutions, which he says spend an average of $25 million a year each just on risk-management technology -- a sliver of the Street's overall tech spending. Because of his banker client base, Lee decided to plant his firm in Manhattan. "Three or four years ago, you'd have been hard-pressed to find a core-technology company in New York," says Lee. "But we have had no problems getting deep-technology people. We see a lot of transplants from the West Coast, and we're picking up people here from other Web projects, like a guy who ran broadband development for a major publisher, and a systems architect who didn't want to be in the content business." Lee expects to close a $25 million second financing round in January, and says DataSynapse could be in the black as early as next year's fourth quarter.