Planet IT

As the market's relentless slide forces IT managers back to basics, it's time they reassess the simplest, yet most crucial business reality: dirt matters. Locating an IT venture is proving to be a critical, but overlooked problem of the new economy. If the promise of information technology is ever going to be fully realized, IT enterprises must consider setting up shop in a far wider range of venues than ever before

After enjoying near-princely status throughout the last decade, IT professionals are suddenly on the defensive. Fueled by the tech-stock collapse and the apparently related national economic slowdown, emboldened skeptics are sparking a backlash against all things virtual. "Dot-com" is now an investment epithet. Unlimited IT resources and skyrocketing salaries are no longer assured.

To the IT professional, the U.S. Navy's decision to have private-sector contractors build and maintain its entire 360,000-user intranet may be the mother of all outsourcing strategies. Many believe in-house IT capabilities protect business secrets and improve efficiency. But if the Navy is willing to treat communications the same as electricity and telephones, how can civilian managers justify greater caution?

What's the difference between the new economy and the old economy," writes a reader, "if people are still just buying things?" Her question is precisely what's vexing tech-stock and big-picture pundits alike. Behind the breathless hype, is there anything truly world-changing about the digital age?

Few economic fantasies are as beguiling as the notion that the Internet consumes far less of our social infrastructure -- roads, energy, police, court time and so forth -- than brick-and-mortar stores and shops.

If the wishes of federal and state economic development officials all came true, U.S. industry would be a high-tech, white-collar paradise. Billions of dollars in subsidies, municipal land-use policies strikingly skewed toward IT business, and the unprecedented state sales-tax moratorium Congress recently bestowed on the Internet show how profoundly our government has bet on a dot-com future.