> Both Microsoft and Netscape Communications Corp. have been competing
> fiercely to woo customers for their Web server software. Microsoft
> distributes its Internet Information Server software for free;
> Netscape's Enterprise Server software sells for about $1,300.
And Apache is also free. Can it be only 3 years ago that Netscape had
its IPO and showed so much promise? I guess their business model was
totally wrong: they should have given their servers AND their clients
away for free from the beginning and just sold the documentation and
support as enterprise services, like it appears IBM is planning to do.
So who's going to buy Netscape to bring them to this scenario? Oracle?
A media company like Time-Warner? Anyone? Bueller?
> Following a trail blazed by America Online and Yahoo, media and
> technology giants alike are rushing to construct these gateways, or
> "portals," through which people venture into cyberspace. The reason is
> simple economics: if they can control traffic, they can move more people
> past the billboards that line the information superhighway.
Who says the Internet cannot be controlled? If we keep seeing companies
consolidate like they've been doing recently, the whole 'Net will
certainly be controlled by a nice little oligopoly.
> General Electric's NBC unit struck a deal to take control of Snap, an
> upstart online directory service, for up to $65 million in cash
> and more than $100 million in free television promotions.
>
> On Monday it was reported that AT&T had been negotiating to acquire
> America Online. And on Tuesday, Microsoft Corp. opened a public test of
> its new portal, known as Start, which is expected to be in full
> operation by the end of the year.
>
> In the meantime, Netscape Communications Corp. is busy shifting its
> focus from making browsers to operating a portal site, and media giants
> like Time Warner and News Corp. are looking to build or buy similar
> services.
Wow. At the risk of sounding buzzwordy, this represents a fundamental
paradigm shift in the way content companies plan on employing the Web...
maybe I'm blowing this out of proportion, but WISEN seems like it's
going to be really important. Because portals definitely need
Internet-scalable notification services, I'm convinced, and no standard
presently exists...
Adam
Full articles follow...
from the Washington Post
> By Elizabeth Corcoran
> Washington Post Staff Writer
> Friday, June 19, 1998; Page F10
>
> In a challenge to Microsoft Corp., International Business Machines Corp.
> plans to throw its weight behind the world's most popular software for
> the "server" computers that run sites on the World Wide Web, IBM
> confirmed yesterday.
>
> IBM plans to announce on Monday that it will become part of the team
> developing and supporting "Apache," a Web server program that has been
> developed by a coalition of programmers around the world and is
> available free via the Internet.
>
> Both Microsoft and Netscape Communications Corp. have been competing
> fiercely to woo customers for their Web server software. Microsoft
> distributes its Internet Information Server software for free;
> Netscape's Enterprise Server software sells for about $1,300.
>
> Even so, Apache has held on to a majority of the market. Most market
> surveys suggest that Apache is used by about half of those running Web
> sites. Where Apache has fallen short, however, is with large
> corporations that want the documentation and support that comes with a
> fully supported commercial product.
>
> IBM plans to include Apache with other Web products it is developing.
>
> News of the deal was first reported yesterday on the Web site of
> Industry Standard, a newsmagazine.
from the New York Times
> Disney Makes Deal to Acquire an Internet Portal Service
> By SAUL HANSELL
> June 19, 1998
>
> Embracing a trend that is rapidly reshaping the Internet, Walt Disney
> Co. let it be known Thursday that the Tomorrowland of cyberspace will be
> entered through a giant consumer gateway cobbled with the gadgets of
> interactive technologies and the proven lure of traditional media --
> news, sports, entertainment and information.
>
> Following a trail blazed by America Online and Yahoo, media and
> technology giants alike are rushing to construct these gateways, or
> "portals," through which people venture into cyberspace. The reason is
> simple economics: if they can control traffic, they can move more people
> past the billboards that line the information superhighway.
>
> On Thursday, Disney announced a complex deal valued at about $900
> million in which it will buy 43 percent of Infoseek, a service that
> helps guide users to what they want on the World Wide Web. The
> announcement capped two weeks of fevered developments across media and
> technology industries that were too small to shake the financial markets
> but obviously a trend that was too significant to ignore.
>
> Last week, General Electric's NBC unit struck a deal to take control of
> Snap, an upstart online directory service, for up to $65 million in cash
> and more than $100 million in free television promotions.
>
> On Monday it was reported that AT&T had been negotiating to acquire
> America Online. And on Tuesday, Microsoft Corp. opened a public test of
> its new portal, known as Start, which is expected to be in full
> operation by the end of the year.
>
> In the meantime, Netscape Communications Corp. is busy shifting its
> focus from making browsers to operating a portal site, and media giants
> like Time Warner and News Corp. are looking to build or buy similar
> services.
>
> While there are tens of thousands of commercial Web sites, most of the
> attention is now focused on the handful that help users find the
> information, services or entertainment what they are looking for. Since
> many people use these sites to start their treks through cyberspace,
> they are far and away the most popular places on the Internet. As a
> result, they have attracted the lion's share of advertising as well as
> investor interest.
>
> America Online, which 18 months ago was drowning in busy signals and
> irate customers, has rebounded into the powerhouse of cyberspace with 12
> million paying customers, a market value of $19 billion and the self
> assurance to rebuff AT&T's takeover offer last month.
>
> Yahoo, the largest of the free, advertiser-supported portal services,
> attracts more than 70 million users a month and has a value of about $6
> billion, despite barely breaking even.
>
> As these sites grow rapidly in market value and viewership -- if not
> profits -- many media companies are deciding that they need to buy one
> quickly, despite the high prices, before they become unaffordable. More
> than one media giant has expressed regret for not having bought America
> Online when it was much cheaper.
>
> "The media companies are starting to wake up and realizing that the
> Internet has the reach of a mass medium," said Jonathan Nelson, chief
> executive of Organic, one of the largest online advertising agencies
>
> Moreover, as television, telephones and computers all converge into one
> integrated network of communications and entertainment, companies of all
> sorts see portals as a possible keystone to their future strategy. The
> power to funnel users to certain advertisers and content sites is worth
> millions of dollars in revenue.
>
> "The search engines have become to the Internet what Windows is to the
> computer desktop," said Alec Ellison, a managing director of Broadview
> Associates, a technology investment banking firm.
>
> Disney's intention is to create a new Internet service that combines
> Infoseek with its existing offerings, which include Web sites for ABC
> television, ABC News, the ESPN sports network, Disney's movies, and a
> site of original Disney entertainment for children.
>
> "There is no site that has both the breadth of Infoseek's search and
> directory service and the depth of Disney's news, sports, entertainment
> and family content," said Jake Winebaum, chairman of Disney's Buena
> Vista Internet Group.
>
> Disney, like many other media companies, has been talking to a number of
> portal services over the last year. A few months ago, it was close to
> buying a part of Excite, the No. 2 portal service, but the deal fell
> apart over the price, investment bankers said.
>
> With the stock of the search services trading at stratospheric prices,
> big companies have been loath to buy them either with cash or their own,
> more conventionally valued shares.
>
>
>
>
> --------------------------------------------------------------------------------
> Related Articles
> Disney Buys Stake in Infoseek
> (June 18)
> Deal With NBC Validates New-Media Strategy of Cnet Founder
> (June 15)
>
> America Online Announces It Will Stay Independent
> (June 18)
>
> NBC Invests in CNet
> (June 10)
>
>
>
> --------------------------------------------------------------------------------
>
> Disney's deal gets around this problem by trading some of its own
> Internet ventures -- at the high value such companies carry -- for
> shares in Infoseek. Specifically, Disney will receive 43 percent of
> Infoseek in return for $70 million in cash and relinquishing ownership
> of Starwave, a company that creates elaborate Web sites.
>
> Starwave's biggest venture is the sports site it operates on behalf of
> ESPN. Disney bought Starwave in several phases over the last year from
> Paul Allen, the co-founder of Microsoft. Keith Benjamin, an analyst for
> BancAmerica Robertson Stephens, estimated that Disney paid about $400
> million for Starwave and that it would be worth about $800 million if it
> were an independent company.
>
> Thursday's announcement represented something of an about-face for
> Disney. When it bought full control of Starwave two months ago, it
> announced plans to integrate the Seattle-based technology company with
> its own Internet operations in Burbank, Calif. Now, all of Starwave will
> become part of Infoseek, which has headquarters in Sunnyvale, Calif., in
> Silicon Valley.
>
> Disney also agreed to lend Infoseek up to $139 million over the next
> five years in return for the option to bring its ownership to 50.1
> percent. Disney, however, will get back most of the cash it is spending,
> as Infoseek has agreed to buy $165 million in advertising from Disney
> over the next three years. That money will buy both television
> advertising on ABC and promotion at other Disney operations, like the
> Internet pavilion at Disney World.
>
> "It's a great deal for Disney, but not as good a deal for Infoseek,"
> said Benjamin, the analyst. Infoseek should have started turning a
> profit this year, Benjamin said, but now the added expense of buying all
> that promotion from Disney will keep Infoseek from breaking even until
> 2001.
>
> "It's probably the best they could get, because without Disney, Infoseek
> would languish in fourth or fifth place."
>
>
>
>
> NBC's deal to buy a stake in Snap was much more favorable to the
> shareholders of Cnet, the company that owned the portal, Benjamin said.
> In particular, it will provide more than $100 million in free television
> advertising.
>
> NBC, however, has much more limited ambitions for Snap, a service with
> well-regarded technology and very few users. The television network
> hopes that heavy TV promotions will turn Snap into a popular,
> stand-alone guide service. NBC's other Internet activities, especially
> its MSNBC news service operated with Microsoft, will remain separate
> from Snap.
>
> Disney, by contrast, is looking to merge its properties into a unified
> service that will have more of the cohesive feel that America Online
> has.
>
> Right now, America Online charges users a $22 monthly fee for both
> access to the Internet and its own content. Portal services like
> Infoseek and Snap have been free to users. But Winebaum of Disney said
> the company hopes to come up with extra services for which users will
> pay fees. Disney's ESPN site earns half its revenue, for example, from
> add-on services like fantasy sports leagues.
>
> Even as the big media companies are buying the existing portal sites,
> many other companies of all sorts are jockeying for position to earn
> money as Internet Gateways. Smaller sites that began offering
> specialized services are now trying to emulate the look and features of
> sites like Yahoo.
>
> And the big technology companies have their own portal ambitions.
>
> The most feared is Microsoft's Start, because it will be the first page
> seen by users of the Internet Explorer browser software that is now part
> of the Windows operating system. Meanwhile Netscape, whose software
> business has been devastated by Microsoft, has been trying to turn its
> often visited but dreary home page into a service with as much news and
> information as the other portal sites.
>
> And Compaq Computer is even trying to turn its products into portals by
> installing several buttons on its computer keyboards that direct users
> to certain Web sites.
>
> Analysts said that all these moves represent the massing of forces for
> what will shape up to be a long and brutal war over which two or three
> portal services will become dominant.
>
> With the stakes in the online world far lower a few years ago, America
> Online spent a $1 billion on television advertising and distribution of
> sign-up disks to surge past its rivals, Prodigy and Compuserve.
>
> "This time," Benjamin said, "it will be much more expensive for someone
> else to catch up."
----
adam@cs.caltech.edu
When I grow up, I'll be stable. When I grow up, I'll turn the tables...
-- Garbage, off their latest album, "Version 2.0"