Boo Is Back

An Iraqi solider secures the site of a bomb explosion Jan. 23, 2007, in Karradah Shiite neighborhood in Baghdad, Iraq. A bomb placed under a car exploded in the Karradha Shiite neighborhood, killing one woman and injuring five others. Getty Images/Wathiq Khuzaie

It's back. Boo.com, one of the Internet's most notorious disasters, rose from the dead this week. And Boo's new boss, Kate Buggeln, says it's a ghost of its former self.

The old Boo had more than 400 employees. The new Boo has "10, and you're looking at most of them right here," Buggeln said while standing in the company's main office.

Launched as a hyper-cool fashion site for the hip, the original Boo went bust in six months after burning through nearly $200 million, CBS News Correspondent Anthony Mason reports.

The new Boo "won't spend that much, let alone lose it," Buggeln said.

Last spring, in a fire sale, fashionmall.com bought the Boo name and memorabilia from the old Boo.

Since then, Boo and many other e-tailers have been sent back to business school.

"I think the biggest lesson people learned is that if there's not a business there, you can't pretend that there is for very long," said Ben Narasin, the chief executive officer of fashionmall.com.

E-tailers promised a revolution, and a few delivered. The auction site ebay accepts three million bids a day.

But the list of casualties, now 76 companies long, is still growing. In a telling turnaround, gazoontite.com, started as a web site, now tells customers who want to buy its breathing products, "please visit our retail stores."

"Well, someone noticed the emperor had no clothes," said Larry Ellison, founder of software giant Oracle.

"By using Internet technology, we saved $1 billion. We became vastly more profitable," Ellison said.

"The Internet's going to be bigger than any of us can possibly ever comprehend. Having said that, there's a whole lot of companies that are going away, and they're not coming back," Narasin said.

But Boo is trying. It no longer buys, warehousing its own inventory. The new Boo will send its customers directly to a product's Web site. Buggeln regards Boo's reputation as a challenge.

The challenge: to prove that there is life after death on the Internet.


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  • CBSNews.com staff CBSNews.com staff

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