The rise and fall of Inktomi

Dr. Eric Brewer, Inktomi’s co-founder and professor at the University of Berkeley, recently gave a talk about the rise and fall of Inktomi during the Internet bubble. Below is summary of his speech:

Inktomi started in 1995 at the University of Berkeley as a project to build a network of workstations (NOW) as a supercomputer. It was expected that the Internet would experience huge growth and search engines would be the first to need giant scale servers, thus the NOW technology would fill that need.

In February 1996, Inktomi was incorporated and utilized funds initially from private investors and later from venture capitalists to build their company and provide the founders with more of the company’s equity. Inktomi partnered with Wired Magazine to produce the search engine, HotBot. In July 1997, Inktomi obtained Microsoft as a client for their search engine and AOL became a client in March 1988.

At its peak, Inktomi was powering AOL, Yahoo and MSN and stocks were priced at $241 per share, totaling $25 billion. During the boom in paid search ads, other internet companies also used Inktomi’s traffic server services. During this time, Inktomi was featured in various publications and even made the front cover of Forbes.

But the Internet bubble had started to burst and Inktomi’s clients who had borrowed money to buy traffic servers collapsed, as well as large clients such as Exodus and Worldcom. Inktomi's revenue dropped from $80 million to $40 million in just one quarter. In addition to the client loss, other company investments in shopping and wireless technologies did not yield fruitful results.

Massive layoffs in 2001 and 2002 and the removal of company divisions did not ward off further loss.

While Inktomi provided innovations that were vital to the development of the Internet, they have also provided a lesson to be learned the most notable being: know your clients. Companies that borrow money and do not generate revenue can go under quickly and take your company right along with them.

Five Quick Tips for Optimizing for Inktomi

• It's important to follow the basic principals of ethical search engine optimization, including optimizing copy and on page elements.
• Be sure your pages are meaningful and provide quality content to visitors.
• Make sure each Meta Title tag is unique for every page within your site.
• Don't keyword stuff your title tag! Make it a meaningful answer to "What is this page informing the visitor about?"
• Create a unique Meta Description tag for each page within your site and emphasize the keywords that you included in the Title Tag.