Three years after the peak of the dot-com frenzy, nearly 5,000 Internet companies have either been acquired or shut down in a massive sector consolidation, according to a study by San Francisco-based Webmergers Inc., a company that provides data and analysis related to technology mergers and acquisitions.

Since the dot-com investment boom peaked in the first quarter of 2000, buyers have spent $200 billion to acquire 3,892 Internet properties, and at least 962 substantial Internet companies have shut down or declared bankruptcy, according to the study.

"We believe that 36 months of often painful adjustment have prepared the sector for the next wave of growth along a rapid but more traditional path," says Tim Miller of Webmergers.

"While it has been notoriously difficult to obtain reliable numbers as to the total number of Internet companies, our best estimates, compiled from industry sources, tells us that near the beginning of the decade there were between 7,000 and 10,000 Internet-related companies that had received formal funding," the Webmergers report says.

Spending on Internet mergers and acquisition peaked in early 2000, while the dot-com purge reached its nadir in the first half of 2001 when 333 companies folded, the report says.

As measured in total companies affected, Internet destinations (Web sites that offer content or e-commerce services) accounted for most of the activity, seeing 1,483 acquisitions and a whopping additional 608 failures in the three-year period.

Internet infrastructure companies in turn saw 1,761 acquisitions and 196 shutdowns in the past three years. Internet-oriented consulting firms and providers of Internet access services accounted for the remaining transactions and casualties.

"We continue to believe that the Internet sector is in the last stages of a boom-bust cycle that has been exaggerated relative to other normal technology cycles," the report says. "We are also certain that the shakeout is nearly over and that it has cleared the decks for a second wave of rapid-but-sane growth that will surprise many observers who have all but dismissed the Internet as a viable tool."