Wikipedia Founder Accepts Internet Downturn

Jimmy Wales, the founder of Wikipedia, is widely considered one of the founding fathers of the Web 2.0. His non-profit online encyclopedia which can be edited by anyone around the world is a popular if not fully reliable resource for web surfers.

But Wales accepts that given the current financial crisis, Internet companies too are feeling the pinch. He thinks it is primarily the marginal players in the industry who will be forced out of the ring. The shake-up in web 2.0 will come primarily in reduced online advertising which along with subcription fees is a primary source of revenue for such enterprises.

Even the behemoths are not safe from the carnage. Yahoo has reported a 64 percent decline in quarterly profits and has shown 1,500 employees the door. Suddenly that offer from Microsoft to purchase shares at $44 each seems like a mistake: current stock prices are a scary $13.

Wales himself has slashed 10 percent of employees at Wikia, a project that competes with Google's online search by involving the masses in ranking search results. The idea is still dubious and the loss of employees should stall its momentum further.

Wales points out that the technology industry has already suffered through a dot bomb once and thus treads much more carefully in valuing companies. He thus doesn't expect the bloodbath to be quite so intense this time but sees less potential for whimsical startups in the current environment.