As for Loudcloud's business, Andreessen said he had not seen any evidence of executives balking since Sept. 11. "But that's probably because we usually get called in to reduce the cost of existing projects, not to start a new project," he said. "A lot of companies have killed their plans for new projects."
In addition to hurting established companies, the post-September economic uncertainty will almost certainly crush the hopes of many newly formed business-to-business Internet companies, Andreessen added. "Sept. 11 drives an exclamation point over the fact that it's brutally difficult for start-ups to raise funding," he said.
"For the venture capital community, it's a more intense version of what was happening in the six months prior," he added. "In theory, they have a lot of cash, but in practice, they're still losing their shirts over the investments they'd made."
Shu, of Gartner, said perceptions about weak Internet security could, in the short term, lead more companies to use networks that connect businesses over dedicated phone lines, instead of the Internet.
Encrypted communications
But others anticipate a different outcome, pointing to some of the few areas where they see signs of sustained, or increased, corporate e-commerce spending. Steven Berkley, who manages the fixed income index group for Lehman Brothers, is expecting to rely increasingly on encrypted Internet communications, given how critical they were in helping his business rebound in the days after the attacks.
Berkley's group was located near the World Trade Center, in offices that remained inaccessible last week. Because the usual dedicated networks could not be re-established immediately after the attacks, his group reached clients via Atabok, a service that sends digitally encrypted files over the Internet. Berkley said the company's employees also used the Atabok service from their homes, when they telecommuted during the week of Sept. 11.
Given Lehman's reliance on networking services after the attack, Berkley said he would push the company to create backup sites with more servers, the computers that form the core of any Internet operation.
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