The passages given below are followed by a set of questions. Choose the most…
2023
The passages given below are followed by a set of questions. Choose the most appropriate answer to each question.
For something that was supposed to be the next global gold rush, the Internet sure seems disappointing. True, companies such as America's Netscape Communications corporation that sell the technology for setting up shop on Internet's World Wide Web, are doing a land-office business and making immense paper fortunes in a bull market dazzled by the Web. But it's damned hard to find any of the prospectors who use those tools actually hitting pay dirt by selling merchandise and information or running an advertisement on the Internet. The horror stories of money-losing Web ventures are everywhere, including high profile fumbles by some of the premier names in media and communications. The biggest losers so far have been US companies, mainly because they plunged in early with money to burn. But players large and small are now following in Europe and Asia. They're likely to hit red ink as well. Take two US leaders, Time Warner and AT&T. Don Logan, the New York-based CEO of Time Inc. last year complained publicly that Path-finder, Time's glitzy Web site, gives a new definition to the term 'black hole'. Since then, Pathfinder has gotten new management, a facelift, and a plan to I begin charging for some content. Now, Time Warner executives say the site will generate profits ahead of schedule.
Meanwhile, AT&T as part of an overhaul of its Web strategy ended up killing an ambitious 'Health Site' before even finishing testing. MCI Communications corporation's Internet shopping mall failed to lure tenants and is shuttered. No wonder the question being asked-ever more nervously by bankers, entrepreneurs, inventors, and corporate executives is: Can you make money on the internet? The answer is yes, but not a lot of it yet. The number of losers still exceeds the number of money makers by more than 2 to 1. But it turns out that why the corporate giants have been thrashing around noisily in cyberspace, showing how not to make money on the internet, scores of entrepreneurs have been quietly tinkering, creating new business models for retailing, marketing, publishing and advertising that work for them and could perhaps point the way to an internet pay-off. This first wave of profitable companies is proving that electronic commerce can work, that you can sell adds on the web, and that at least sometimes, people will pay for online information. "Companies that are offering unique business propositions on the web can and be successful: says Fransisco analyst Betty Lyter of Montgomery Securities.
Why the author of the passage is telling that: The biggest losers so far have been US companies?
- A.
because these companies do not sell online.
- B.
because they plunged in early with money to burn.
- C.
because these companies don’t provide after sells service.
- D.
None of these
Attempted by 1 students.
Show answer & explanation
Correct answer: B
Answer: They plunged in early with money to burn.
Explanation: The passage explicitly states that the biggest losers have been US companies mainly because they invested early and spent heavily before business models proved profitable. This early, large spending is summarized by the phrase "plunged in early with money to burn."
Supporting examples from the passage:
Time Warner: Path-finder was described as a "black hole," required management changes and plans to charge for content after losses.
AT&T: Overhauled its Web strategy and cancelled a large 'Health Site' project before completion.
MCI: Its Internet shopping mall failed to attract tenants and was closed.
Conclusion: The passage's central reason for US companies being the biggest losers is their premature, heavy spending in the early Internet market, not the other suggested causes.