Sure, buying Netscape was a highly speculative play. And, yes, the stock market was eager to reaffirm its faith in the tech stock category as a whole. What better way to create a buzz, however artificial or inflated, about "the next Microsoft."
That said, there were some substantial underlying reasons why investors took a flyer on Netscape. For one, the widespread interest in Netscape's future had a lot to do with the company creating highly consumer-friendly products. Ask those computer users who had reached new levels of frustration with navigating through cyberspace until they became acquainted with the Netscape Navigator Web browser. Not to mention that many of these newly proficient browsers had their pleasure doubled by getting the product gratis-a clever marketing tactic leading users on to other, more sophisticated software with handsome profit margins.
From our vantage point, Netscape richly deserved the payoff it received for keeping the consumer in the forefront of its field of vision-and for demystifying access to the increasingly market-driven Web.