A 55-year journey: From the internet’s birth to Google, AMZN & META alone worth $5T
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On this very day 55 years ago, a small group of computer scientists at the University of California (UCLA) did something that had never been seen before – they created the world’s first internet connection and successfully transmitted a message over a great distance.
Led by Leonard Kleinrock, UCLA’s professor of computer science at that time, the team launched ARPANET, the precursor to the modern internet. The message they sent to the Stanford Research Institute hundreds of miles north was “LO”, transmitted on October 29, 1969.
“According to Kleinrock, they intended to transmit the word ‘LOGIN,’ but the system crashed just after they had sent the first two letters. ‘Hence, the first message on the Internet was ‘LO’ — as in ‘Lo and behold!’,’ Kleinrock said. ‘We didn’t plan it, but we couldn’t have come up with a better message: succinct, powerful and prophetic,'” the UCLA website said.
At that time in 1969, there was only one U.S. tech company in the top 100 firms in the Fortune 500, and that was IBM (IBM).
Fast forward to today, and the rise of tech has truly been mind-boggling. Currently, the combined market capitalization of the three largest internet companies – Alphabet (GOOG)(GOOGL), Amazon (AMZN) and Meta Platforms (META) – totals a staggering $5T. That number is greater than the annual growth domestic product of every country in the world except the U.S. and China.
The Nasdaq Composite (COMP:IND), the benchmark for tech companies, was established not long after the birth of the internet.
The index was launched on February 5, 1971, with a starting value of 100. The gauge ended that year +14.1%. Today, the Nasdaq Composite (COMP:IND) is +23.7% so far in 2024. Adjusted for inflation, the Nasdaq was trading at around 875 points in December 1971, compared to a whopping 18,500 now.
Today, according to CompaniesMarketCap, these are the top 10 internet companies by market capitalization, along with their YTD stock performance:
- Alphabet (GOOG)(GOOGL), +21.4%.
- Amazon (AMZN), +25.6%.
- Meta Platforms (META), +63.3%.
- Tencent (OTCPK:TCEHY)(OTCPK:TCTZF), +43.1%/+43.7%.
- Netflix (NFLX), +53.9%.
- Alibaba (BABA), +28.9%.
- ServiceNow (NOW), +34.9%.
- PDD (PDD), -14.4%.
- Uber (UBER), +28.7%.
- Booking Holdings (BKNG), +22.6%.
See below for the top 10 U.S. internet services and infrastructure companies as screened by Seeking Alpha’s Quant rating system:
- Twilio (TWLO), Quant rating: 4.66.
- Cloudflare (NET), 4.58.
- Backblaze (BLZE), 3.98.
- GoDaddy (GDDY), 3.80.
- Applied Digital (APLD), 3.44.
- Akamai Technologies (AKAM), 3.31.
- DigitalOcean (DOCN), 3.30.
- Okta (OKTA), 3.28.
- Crexendo (CXDO), 3.26.
- MongoDB (MDB), 3.20.
Here are some exchange-traded funds of interest that are linked to technology and communication services: (VGT), (XLK), (IYW), (FTEC), (IXN), (RSPT), (XLC), (VOX), (IYZ), (RSPC), and (XTL).
And here are some ETFs linked to the Nasdaq Composite (COMP:IND): (QQQ), (QLD), (TQQQ), (QID), and (SQQQ).