Dot com busts doubled in '01, shutdown rate slows

NEW YORK: More than twice the number of dot coms shut their doors or declared

bankruptcy in 2001 than a year earlier, but the rate of failures has begun to

slow in recent months, according to a report released on Thursday by

Webmergers.com.

About 537 Internet companies shut their doors during the year, compared with

about 225 dot com failures in 2000, with more business infrastructure companies

closing down than consumer companies in 2001, said the company, an online hub

for buyers and sellers of dot coms.

Despite the dot com carnage this year, the worst seems to be over for

Internet closures, which have declined substantially in recent months. November

and December of this year each saw 21 shutdowns, the lowest number since August

2000, the report found. The carnage, however, does not suggest that there are no

dot coms left on the horizon, Webmergers.com said.

"We conservatively estimate, based on several data sources, that between

7,000 and 10,000 Internet companies have received some sort of 'formal' funding,

which suggests that at most, 10 per cent of significant Internet companies have

shut down or declared bankruptcy," the report said.

© Reuters Limited.