Out-Law / Your Daily Need-To-Know

Internet researchers Webmergers.com has announced that a provisional total of 54 internet firms folded in May. This is only one less than the figure for April and indicates the continued decline of internet enterprises. The first signs of internet initiatives falling victim to the changing economic climate were noticed early last year, but the numbers of firms being forced to shut down has risen dramatically since then.

The report states that at least 493 substantial internet companies have shut down since January 2000, but that over half of those did so during the first five months of this year. Almost 50% of these firms were involved in e-commerce ventures, whilst the remainder operated in other internet related fields. These included internet consulting firms, internet access providers and application service providers.

The results for May show that the rate of shut downs is unlikely to fall in the coming months, although some struggling dot.coms may still benefit from the use of financial restructuring services.

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