Technology. (Barely Making the Grade).

Year in Review: Ouch -- Creative Planet, Dunk.net, eToys, IXL, MarchFirst, Stamps.com, Sapient, Careerpath.com... If they didn't go bankrupt altogether, many of L.A.'s hottest technology companies slashed personnel, bolted expensive Westside office space and generally adopted lower profiles... Idealab Inc., which launched some of Southern California's most glorious examples of dot-com excess, was left hanging on for dear life.

Venture capital companies closed the spigots that had flooded the tech sector. After Sept. 11, many VCs told their portfolio companies they had better find ways to make it without a new round until things normalize... NetZero merged with Juno Online Services, combining the remaining free ISPs as United Online Inc.... Web viruses -- "Nimda," "Hi" and "Anna Kournikova" -- incapacitated home computers and brought office networks to their knees.

Players to Watch: Defense firms and universities will continue to incubate the real, moneymaking ideas.... Expect large, well-capitalized local players like Raytheon, Northrop, Caltech, UCLA, USC, Cedars-Sinai Health System, to lead the charge... Record labels will struggle with Napster alternatives.

Buzz for 2002: After 24 months that saw phenomenal growth followed by crippling failures, the new year will be one of caution and patience. Look for faltering dot-coms to burn through their remaining cash without finding new sources to keep them alive... Manufacturers will place renewed emphasis on self-service account management for customers (businesses and general consumers) through Internet sites... Consumers will reject major record labels' efforts to charge for temporary online music access.

Expect a race to develop new Internet security applications to protect PCs, office networks and big Web servers from viruses... As wireless technology allows for greater volume of voice and data, development companies will saturate the market with games and other trivial programs until a killer app takes root... So-called supply chain programs -- inventory and distribution software -- will continue to be a profitable pursuit as manufacturers look to streamline and cut waste.

A new wave of technology called bioinformatics (using computers to compile and arrange information from the human genome for research and investigation) is on the horizon. Question remains whether the technology and dollars to support it arrive in '02 or later... Defense industry and research centers will drive innovation; more jobs in defense/aerospace industry mean more spinoff companies, technologies, commercial products.

University research centers will step up efforts to commercialize findings and inventions... Video game makers will have a ball trying to keep up with demand fortifies for the new console platforms... Hollywood and the software industry will keep getting cozier... Bioscience sector will see consolidation... Nanotechnology? Maybe, but probably not for a couple of more years.

Grade: B