Living The Late Shift

By Karl Taro Greenfeld

Downtown, New York City; Tuesday, around midnight. Skat is interacting on live chat with Appzworld. A twentysomething blond, she rants into a microphone as a Canon XL-1 digital video camera sends streaming footage of her to a few dozen Webcast viewers across the U.S. and Canada. With her free hand, she types responses to comments posted in the IRC (Internet relay chat) Netfiend room.

"What's up, Appz? You got skillz?" Skat asks, mugging for the camera. She steps back to read aloud his offer to swap pirated content for high-tech gear. "Appz wants to trade a Star Wars screener for a new motherboard PII 200 with a sound card."

What's going on here? Even the producers, programmers and performers responsible for presenting the hip-hop-culture-meets-computer-hacker show Netfiend, one of a hundred streaming video shows Webcast weekly by Internet start-up Pseudo.com can't tell you for sure. But they are thrilled to be here so deep into the night. Internet television is an unproved--and, for the moment, virtually unwatched--medium, yet the Netfiend crew is resolutely sure it is on the verge of something very big. So confident are Skat and Pseudo.com's 70 other employees of the vast potential of their still undefined and unsellable product that they are willing to be underpaid for 70-hour workweeks in a poorly ventilated former garment factory.

That desire to be in the middle of the digital revolution has compelled thousands of young workers to migrate to one coast or other seeking to cash in on the Internet and silicon dream. The myth goes something like this: acquire computer skills (skillz, in the jargon), join an aggressive start-up and, when the company goes public, cash in and make millions of dollars. It worked for Amazon.com's Jeff Bezos, Yahoo's Jerry Yang, C-Net's Halsey Minor and a host of others. When will it work for you?

The reality, though, is that the new-media and high-technology workplace today often more closely resembles a piecework-industry sweatshop than a pristine NASA laboratory. New Internet businesses, financially strapped and compelled to set up shop on pricey real estate in Manhattan's Silicon Alley or California's Silicon Valley, have to scrimp on the office space, using converted industrial lofts crammed with desks, T-1 lines and terminals. During the pre-initial public offering phase of a start-up, precious capital must be allocated to marketing and sales rather than rent and salaries, which contribute only to the burn rate--the monthly running expenses of an Internet company ticking toward ipo or implosion. For new-media employees, the workday is 16 hours, the workweek seven days. "Cyberspace is rife with sweatshops," says Andrew Ross, director of the American Studies program at New York University. "The problem is, very few people realize it. The glamour of the technology industry carries a powerful mystique."

CEOS rely on that mystique, and on the legions of eager Webbie wannabes it attracts, to keep costs in line; very few new-media firms pay overtime or bonuses. "I see so many dawns it is ridiculous," says Mark Oren, 25, an information-systems architect at IXL, an e-commerce-solutions company based in New York City, "consecutive days where it's 5, 6 a.m. and I'm finally going home." And the salaries, while decent, are hardly stratospheric. A New York New Media Association study found that high-tech jobs paid an average of $37,212 a year, tough going in a city where a pizza costs $15, and lower even than salaries in such old-media jobs as advertising and TV.

But CEOS, eager to rally their employees to look beyond the low pay and long hours, liken their businesses to wars and their workers to zealous warriors. "There's a revolution going on," says Jeffrey Dachis, 33, CEO of Razorfish, a Web design firm, "and we're handing out rifles."

And pillows. To keep employees at their terminals longer, the companies intentionally blur the line between work and play, office and home. Bring your dog to work, decorate your workspace with Gundam robots and Darth Maul action figures, drink all the Mountain Dew you can stomach. Where would a young techie rather be, at home struggling with a high-ping 56k modem or at the office, surfing on a T-1 line?

For the driven CEO, the mixing of work and play creates a beautiful sight: workers in front of their terminals into the wee hours. "I don't think there is leisure time anymore. New-media workers don't take time off and decompress; their idea of time off is playing Quake on the LAN [local area network]," says Steve Baldwin, co-author of the forthcoming book Netslaves.

It's the job of executives at the top of the Internet food chain to convert that low-cost enthusiasm and work-is-play lifestyle into publicly traded companies worth millions of dollars. And a number have succeeded: TheGlobe.com's chairman Michael Egan is worth about $200 million; StarMedia CEO Fernando Escuelas, 32, now has a net worth of $256 million. Josh Harris, chairman and founder of Pseudo.com stands to make millions when Pseudo goes public later this year.

But for the cast and crew in the engine rooms of these Internet dreadnoughts setting sail for IPO land, the reality is that many of them will never see stock-option millions. Some can't sustain the grueling hours. Still others won't stay at the company for the four years it takes the typical options package to vest--i.e., for the shares to become sellable. "The options are what lead people onward," says Patrick Neeman, director of development at the website Buyingedge.com "But these people waiting for the big IPO are just waiting forever. The only people who get wealthy are VPs and above." And here's another reality check: for every 10 companies that offer employees options packages, only one ever actually goes public.

What happens to the unlucky many who don't get rich by the time they are 30? In a field that relies on the young, older programmers become increasingly unemployable because their salary demands are likely to be out of line with start-up budgets and their skills to be perceived as obsolete. Computer-science professor Norman Matloff of the University of California at Davis points out that 20 years after college, only 20% of programmers remain on the job. Most no longer work in high technology.

But for the Netfiends at Pseudo.com the long odds don't deter them from long hours. There is in this cluttered, cramped studio, amid the computers, monitors and digital video cameras, a palpable messianic fervor that this is incontrovertibly the right place to be. The future is happening here, and how can you put a price on that?

Skat, the Web host, looks up from her monitor and says, "Pseudo is about hiring young kids who live the Net and don't know about equity positions." As for Skat, well, she's a little older now, and she's working out her own deal--which will, of course, include stock options.

--With reporting by Janice Maloney/Silicon Valley

With reporting by Janice Maloney/Silicon Valley