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Kudelski says high-tech shake out was inevitable

André Kudelski gives a lecture to delegates at the WEF summit in Davos

(Keystone)

One of the main areas of discussion in Davos has been the failure over the past twelve months of so many companies in the Internet sector.

When delegates met last year, the Internet seemed to offer the prospect of unlimited economic growth. Investors seemed prepared to finance the flimsiest of ideas for a dot.com company.

But in March 2000 the speculative bubble burst and many infant companies went to the wall. Investors had their fingers burned as technology stocks tumbled.

World Economic Forum delegates have been debating the lessons to be learned from the last twelve months.

André Kudelski, the CEO of the Kudelski Group, is well placed to comment. His company is one of the world leaders in securing digital television and the broadband internet. The Kudelski Group was also the leading performer on the Swiss stock exchange last year.

"A little more than a year ago, there was no difference between companies with real potential and companies that just had a dream," Kudelski told me.

"The shake-out was inevitable although a little exaggerated. In the medium term things should go in the right direction."

Kudelski agrees that it is now much more difficult for start-ups to find investment but he thinks this is a good thing because it will make would be new economy entrepreneurs think twice.

"You can't take the future for granted," he advises, "Sure, make a long-term strategy but be prepared to take short term steps to rectify mistakes and adapt to changing conditions."

He says the new economy is built on shifting sands and companies have to take account of that.

This is Kudelski's seventh time in Davos and he is defensive of the Forum's critics.

"Globalisation is not a result of the World Economic Forum in Davos," he says, "We're here to take a look at what is happening and to see how it can be improved."

Kudelski admits though that the divides between the richer northern countries and the poorer southern countries will not be easily bridged.

And Kudelski says the atmosphere at the Forum has changed in the last few years as the threat of anti-globalisation protests has grown.

"When I first attended Davos was a nice little village but now it's like Fort Knox."

by Michael Hollingdale.


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