The Online REPORTER
WEEKLY DISPATCHES FROM THE INTERNET FRONT
September 2 - 6 Issue No 14
DEC SPINS OUT ALTAVISTA
Digital Equipment Corporation announced last week that it had filed with the Securities and Exchange commission to put 20 percent of its AltaVista Internet software business up for public offering.
DEC officials say that under the structure of the IPO they would also roll their entire Internet Software division into AltaVista. They say that the number of shares to be released has not yet been determined, but the filing reports that $50 million would be the maximum proceeds - not bad for one fifth of a division that has lost money since day one.
Despite the obvious implication, DEC denies that the scheme is an attempt to scrape together some cash after four years in the red. It say that it's got $2 billion in the bank and that the point of the IPO is to allow the subsidiary to focus on Internet software while giving it some working capital.
UK ISP BODY LOSES POLITICAL HEAD AS CIX AIMS GLOBAL
As politicians become increasingly interested in the regulation of the Internet, service providers are still a long way from gaining a unified voice. Late last week, Peter Dawe the political officer of the the UK Internet Service Provider Association tendered his resignation as the country's providers fell out over the best way to respond to efforts by the police to crack down on pornographic newsgroups. Dawes was heading a UK-driven effort to muster support for a pan-European ISP organisation, which now seems likely to founder.
At the same time, however, the mainly-US Commercial Internet eXchange (CIX) is actively moving ahead with its plans to become an international voice for the Internet trade. CIX VP and board member Glenn Kowack said "it can be taken as a given" that CIX's board will go ahead with proposals to begin active recruitment in Europe and Pacific Rim and is in the process of organising representation in the two areas. CIX's role will be to try to educate and steer law-makers before they decide that Internet regulation is necessary. "Often the old, tired regulatory directions simply won't work" he said. CIX is actively pursuing relationships with the International Telecommunications Union, the World Trade Office (set up as a result of GATT 2) and the World Intellectual Property Office. It is also targeting the European Community Commission. CIX is aware that trying to impose a single ISP voice across continents won't work says Kowack. "Rather than trying to drive a structure down into various companies, we have put out a call to our members to start regional bodies", he says. "It could be that there will be a CIX European Chapter, for example" he added. Over the last year and a half CIX has gradually been transforming itself from a simple organiser of interconnections between ISPs into a lobbying group.
Dawe's resignation shows how difficult it is for ISPs to reach consensus in even one country. Faced with calls from the police to
NETSCAPE GARNERS LUKE-WARM SUPPORT FOR 'NAVIO' EFFORT
Last Monday Netscape Communications Inc. trotted out company bigwigs Jim Clark and Mark Andreesen to announce the formation of a new subsidiary, Navio Communications Inc, which is supposed to extend Netscape's Navigator technology to the lucrative consumer electronics market. In addition to Netscape's controlling interest, the company is financed by seven other interests, but nobody is saying who these investors are. Netscape did announce that six companies - Nintendo, Sony, Sega, NEC, IBM and Oracle - were "backing" the initiative, but was ambiguous as to what "backing" actually meant. When contacted, Sony, Nintendo and Oracle were quick to downplay their commitment to Navio. Sony's response was typical, with a spokesman saying "our engineers have been involved in preliminary discussions regarding technology issues of mutual interest" and asserting that Sony has no product plans at this time. NEC at least admitted that it hoped to use Navio technology in its upcoming network TV - when that would be, well NEC wouldn't comment.
So it seems that nobody but Netscape is willing to admit any commitment to Navio beyond a pat on the back for sticking it to Microsoft, yet Navio officials predict revenues by the first quarter of 1997. Netscape admits that the consumer electronics market is more complicated than Netscape's traditional battlefield. Navio's product will have to be customized for a large number of individual devices and operating systems and this, according to Senior Vice President of Technology Mark Andreesen, "will take a lot of breakthroughs".
Still, the consumer market represents a huge volume of sales - at least 500 million according to Netscape - and it has the advantage of being one place where Microsoft is not already entrenched. Furthermore, Netscape may be able to capitalize on some antipathy toward Redmond. As Jupiter Communications analyst Adam Schoenfeld points out, "most of the people involved in non-PC devices are there because Microsoft basically kicked them up and down the vineyard in PCs and PC devices". According to
BLOCK KEEPS COMPUSERVE
News of re-structuring and falling subscribers has halted the spin-out of Compuserve. H&R Block Inc of Kansas City, now believes prospects for the online bisiness as a free-standing company are so poor that it has abandoned its plan to spin off the 80% it still owns after the spring flotation by handing out shares to its shareholders, and will now hold on to them. The shares were floated at $30 in April and are now down at $12.50.
Block is hanging on because of CompuServe's recent and projected losses and market uncertainties regarding the on-line industry but is left in the worst of all possible worlds because, with CompuServe shares trading, it can't decently hide just how badly the company is doing in its own figures. It says it is still comitted to separating the sharehodings, but gives no date
WORLDCOM'S SHARE-PRICE
TUMBLES AS BELLS CIRCLE
No sooner had WorldCom Inc announced that it planned to acquire MFS Communications Inc in a share exchange originally valued at $14,000m than the price was rapidly trimmed to $11,500m as WorldCom's share price went into a decline. Meanwhile, the top brass at the soon-to-be five Baby Bells rushed to feed the numbers into their spreadsheets and try to decide whether to spoil the party by bidding for WorldCom now, or wait until completion and gobble the whole lot up.
Their cash flow is such that even the smallest could afford the one big chance left to get into the long-distance and international business at a stroke. That prospect has - at least temporarily - given WorldCom a market capitalization that means the combination would outrank MCI Communications Corp in valuation, even though the latter is vastly bigger at $15,250m, a year compared with $5,400m for the WorldCom-MFS combination. WorldCom, Jackson, Mississippi is the combination of LDDS Communications Corp with the WilTel business of Williams Cos: the combination created a US-wide network of fibre-optic cable, most of it laid in disused pipelines.
WorldCom also has an international telephony dimension by virtue of its acquisition of satellite operator IDB Communications Corp. MFS - formerly Metropolitan Fibre Systems - of Omaha, Nebraska is a builder and operator of Metropolitan Area Networks, and to link these together for its customers has had to lease capacity - from the likes of WorldCom. It has begun building networks in Europe where it is permitted to do so - currently the UK, Germany and France. It also has one of the biggest Internet access providers in the shape of UUNet
Technologies Inc, so the combination creates a one-stop shop for local, long-distance, international and Internet access =services. WorldCom is clearly the more attractive of the two for a Baby Bell, and in recognition of this, the partners have moved to make it more expensive for outsiders to muscle in by setting a $350m break-up fee, while WorldCom has put in place a poison pill that can be activated if a hostile bidder picks up 15%. The combined company - to be known as MFS WorldCom - will have a 25,000-mile end-to-end fibre network connecting all the major metropolitan areas of the US. Since the company will own its own local and long-distance facilities, it will not be bound by the regulatory restrictions facing the Bells - which have to prove that their local markets are open to competition before they can offer long-distance services - but will instead qualify for preferential treatment under the Federal Communications Commission's new Interconnection rules. WorldCom will pay 2.1 new shares for each MFS out, at $55.39 a share, a premium of 58% to the MFS price at announcement time, although it was soon trimmed to $47 by the fall in WorldCom's shares. WorldCom warns of three years of earnings per share dilution from the acquisition, which may make holders think twice about approving it rather than selling to a Bell.
MICROSOFT BACK-PEDALS ACTIVEX STANDARDISATION
Microsoft appears to be in the full-flush of damage control brought on by what Microsoft EVP Steve Ballmer last week called a "naive" move to thrust ActiveX into an independent standards body, reports sister paper ClieNT Server News .
According to what Ballmer said in a press Q&A following his keynote Thursday at the Windows NT Intranet Solutions show in San Francisco, Microsoft is redefining what ActiveX is so the core of Redmond's precious COM, DCOM and possibly some bits of OLE object technologies remain outside the standards body's province.
For the five months it has existed, ActiveX has been nothing more than an ambiguous marketing term whose published definitions have all conflicted making it easier for Microsoft to declare it anything it wants to. According to an overhead Ballmer threw up last week, ActiveX is limited to controls, scripting, document objects and accessibility. These are the pieces that would be consigned to the prospective standards body, he said, barring outright revolt of the people who attend the ActiveX summit that's meant to adjourn at some still-unannounced time and place late in September, having been bumped from August. Of course, it should probably be pointed out that Microsoft controls the invitation list though competitors are expecting to attend
To be fair, Ballmer did appear to leave some room for negotiating what would go into the standardization process. As to why Microsoft remains mute on the time and place of the one-day summit which was originally supposed to decide on whether ActiveX would go into a new or existing standardards organization and how that transition would be made, Ballmer said, "It's kind of a tricky thing. There's more political complexity than we anticipated. So we're taking our time." Ballmer's statements appear to support the widely-held conclusion that Microsoft's sudden standards body proposal was hasty and ill-considered as to its ramifications. Its enemies at least have maintained that it would backpedal off it as soon as it could - hence the myriad excuses for the delay.
VENTURE CAPITAL TARGETS MANHATTAN'S INTERNET START-UPS
Chase Manhattan Corp has teamed up with insatiable Softbank Corp of Tokyo, and each will invest $25m in a new venture capital fund which will focus on Internet-related companies specifically based in New York. The common perception is that all the interesting Internet-related technical developments are taking place on the US' West coast, but there are an estimated 700 multimedia and Internet companies in Manhattan's so-called Silicon Alley - the small patch of downtown between the Flatiron building and the SoHo area. Many are starved of seed capital.
The development, is called Flatiron Partners, and so far, Chase's venture capital arm, Chase Capital Partners, and the Japanese magazine and software publisher are the only investors in the fund. The fund will not confine itself to New York if something really hot (apart from pollution) comes in from Jersey - or even further afield on the East Coast, but the emphasis will remain on new-media and Internet-related companies in the creative heart of Manhattan.
The partners have tapped Jerry Colonna, a former partner in the CMG Ventures Fund that financed World Wide Web search company Lycos Inc before it went public earlier this year, and Fred Wilson, a former partner in the Euclid Partners New York venture fund to run the new operation. And each partner also says it may also directly invest up to another $50m in companies financed by Flatiron. No-one is talking officially, but the fund has reportedly already invested $4m in Yoyodyne Entertainment Inc, a company based in Irvington, New York and formed to develop sweepstakes and promotional games for the World Wide Web. The potential of the new fund is underlined by the fact that about half the recent seed capital deals have been Internet-related, but most have been in California.
l Meanwhile Venture capitalists Kleiner Perkins Caufield & Byers was receiving over 100 calls a day on their fund last week - mostly from interested start-ups looking to cash in. The .$100 million Java fund (OR issue 12) is backed by industry heavyweights like Sun Microsystems, Netscape and IBM. It will invest in 20-30 companies over the next 10 years.
Kleiner Perkins Associate Michael Palmer says that the fund will consider plans
from companies whose products are "Java related in the broadest sense" and will choose those that represent a unique and strong market opportunity. He adds that the creation of the fund certainly sends a message to the industry that venture capitalists are interested in Java. Calico Technology, Marimba and Active Software have already been funded.
VERISIGN AND JAVASOFT JEEVES REFUGEES FORM START-UP
The brain-drain at JavaSoft continues. Last week members of its Jeeves server project defected to launch their own Internet startup company, innovatively code-named Internet Startup. The company has over $1 million in VC money behind it, thanks to Menlo Park's Bessemer Venture Partners. David Cowan, a general partner with Bessemer will be the new company's CEO. Cowan also happens to sit on the board of digital authentication company, VeriSign, Inc.
The week-old startup is not yet ready to announce products, but according to its VP of Marketing, Chris Zuleeg, Bessemer identified what will become an obvious and compelling customer need six months down the line and recruited the ex JavaSoft employees to develop a solution. VeriSign is best known for providing authentication technology like SET compliant digital certificates and Jeeves is Sun's Java-powered Internet server, so it seems likely that Internet Startup will be providing some kind of server side authentication software, though Zuleeg says that the final product will include both client and server software.
The product, he adds, will make it easier for networked applications to become ubiquitous. Sun's Jeeves technology, which is currently available free of charge at www.sun.com, makes use of servlets - server side applets - to write cross platform database plug-ins in Java. Whatever Internet Startup ends up shipping, it is expected to be in beta 9 months from now. Internet Startup expects to be giving away its software at first, and charging once it has market share.
BSKYB PLANS SATELLITE INTERNET
High-speed Internet access will be one of the services to be provided to subscribers to digital television services in the UK and Germany. British Sky Broadcasting Plc reckons that only about 15% of UK homes have personal computers, so it is ordering up a television set-top box decoder with the power of a personal computer - and will have to subsidise it heavily. No word on the processor - or even whether a specific processor has been chosen, but according to Electronic Times, specifications sent to those tendering to build the boxes include integration of a 100Mbps IEEE1394 serial bus interface and a fast modem link. The interface will support everything from home audio systems to printers, and will provide a fast link to personal computers. BSkyB also plans to offer home banking, home shopping and other interactive services. The satellite broadcaster is also demanding advanced MPEG functions such as handling mosaics of eight windows on-screen, so that you can follow up to eight individual cars in a Grand Prix - while people actually at the event can't see anything through all the cameras. And in Germany, Bertelsmann AG says that its Mediabox digital television decoder will also support Internet access. The Mediabox was developed jointly by Bertelsmann and Canal Plus SA, in competition with Bavarian mogul Leo Kirch's D-Box.
AUTONOMY INTENDS TO TURN ISPS INTO 'KENNELS'
Cambridge Neurodynamics spin-off Autonomy, Inc. has transplanted itself from England to Palo Alto California and has released the first parts of its Autonomy suite of applications in beta code. The software alledgedly uses neural network technology to "learn" what kind of information users are seeking and then, using any Internet browser, goes out to retrieve it from Web sites and email folders.
Though it is interesting to see the small cartoon dog snuffle its way around the Net, this kind of client-side searching requires that users stay connected to the Internet for long periods of time, while the software does its snooping.
Autonomy is considering two possible ways around this, both of which it plans to roll out in the next quarter. The company is working on deals with ISPs to allow Autonomy's intelligent agents to continue searching the Web while disconnected from their host user - a process it calls 'kenneling'.
Service providers would license kenneling technology from autonomy as a draw to their subscribers. Autonomy CEO Drew Harman says that Autonomy's technology could also be used as a sort of replacement for traditional search technology on Web sites, a process he calls concept indexing. However concept is far more complicated than traditional keyword indexing and therefore requires more computational power. But why not do concept indexing on the contents of an entire search engine like Yahoo or Lycos?
Harman says that this is not feasible right now: "You'd have to have some pretty monstrous machines to do a concept index of the World Wide Web." Autonomy will be available online in October and in retail outlets by January.
JAVA DECOMPILER GETS PULLED
Freelance software engineer Hanpeter van Vliet is reconsidering whether his Mocha Java decompiler is suitable for public consumption following some nasty letters from US software vendors.
After posting the software for free on his Website, the Dutch programmer says that he was contacted by lawyers from of a number of companies expressing their concern that the decompiler, which converts Java bytecode into source code, could be used to copy and reuse proprietary Java applets. He says that the threat of a liability suit caused him to pull Mocha off of his Website and seek legal counsel.
Van Vliet asserts that the point of Mocha was never to create a way of ripping off Java code. He adds that pulling Mocha out of circulation is not likely to stop anyone from decompiling Java bytecode. Any competent programmer with enough free time and nefarious intent could develop such an application on his own. To see whether the Internet community wants Mocha to stay or be eradicated van Vliet is polling visitors to his site on the issue. So far, the vote is 10 to one in favor of bringing Mocha back. With or without Mocha, van Vliet will continue posting software on his Website. Next week he conveniently plans to release what he calls an obfuscator, named Crema, on his Website. Crema will prevent decompilers like Mocha from working.
http://web.inter.nl.net/users/H.P.van.Vliet/mocha.htm
NETSCAPE GRABS OS/2, MAC
Microsoft may have Internet Explorer bundled with Windows, but Netscape appears to be making a concerted attempt to get its browser bundled with everything else. Last week it announced deals with Apple and IBM that will see Navigator bundled with Mac and OpenDoc respectively. Netscape will develop an OpenDoc component version of its browser that will become the default browser within Apple's rather nice Cyberdog Internet suite. The Netscape module will replace CyberDog's existing browser. But there is no indication that there will be Netscape modules covering News, mail and FTP - which Cyberdog already has. Apple says that the Netscape browser will eventually be incorporated into the operating system. Netscape Navigator for Cyberdog will allow users to embed browsing capabilities in other OpenDoc-compatible applications. Apple says that an OpenDoc-supported word processor will able to incorporate live links to Web sites that would provide continuously updated information. Just how useful that is remains to be seen.
On the OS/2 side, Netscape will develop a version of Navigator 2.02 and have it in beta by September and available by year end "shortly after the launch of OS/2 Warp 4." All copies of Warp 4.0 will get a copy of the OS/2 Navigator. More interesting is the joint development of Navigator 4.0 for OS/2 which is vaguely scheduled for some time next year. Neither IBM nor Netscape are saying anything about it, other than it will be modular, as will all the Navigator 4.0 offerings. Whether it too uses OpenDoc will test IBM's commitment to the technology.
LOTUS PROMISES WEB APPLICATION COMPONENTS
Alongside its Domino Web application server, Lotus Development Corp will also try to proliferate Notes across the Internet by offering Web-enabled versions of its current OCX- and ActiveX-based Lotus Components application building blocks from next year. The idea is that Web developers will use the Components - current examples include Chart, Comment, Draw/Diagram, File Viewer, Project Scheduler, Spreadsheet and Component Template Builder - within Web applications. Users will activate a Lotus component with their browsers to access and run the application. Lotus says a brokerage house could use the Components to create an Internet application which queries investment portfolios. When posted to the Web site customers would be able query their portfolios and use the Spreadsheet and Chart components to analyze and display their data. Meantime Lotus says it's now shipping ActiveX versions of the six core Components (not Web-enabled) in a starter pack at $50 per client seat. Later this year it will offer Lotus Components Product Warehouse, a Notes 4 application allowing for distribution of Lotus Components and license monitoring within an organization. The next version of Lotus Word Pro, which will ship as a part of SmartSuite 97 in the fourth quarter, will include a container for Lotus Components.
MITSUBISHI AND SONY BOTH INTRO TV-BROWSER COMBOS
Last week Japanese consumer electronics heavyweights Mitsubishi Consumer Electronics and Sony Electronics Inc. both announced devices that let users browse the Internet using their televisions. Mitsubishi's DiamondWeb television is the more ambitious of the two. DiamondWeb will be an integrated big-screen television/Internet appliance incorporating Motorola's MPDC801 PowerPC chip and Microware's OS-9 operating system. Mitsubishi says it will announce who is providing the browser software next week. Because the graphics processor on DiamondWeb will be feeding signal directly to the set's cathode ray tube, Mitsubishi figures it will turn out better performance than Sony's effort.
Mitsubishi is still evaluating the possibility of providing a plug-in box like Sony's to its legacy customers. Sony's box, called Sony WebTV, is being manufactured under license from WebTV Networks, which also just happens to be the ISP for the initiative. It is expected to ship by September at a cost of $349. Pricing and availability of DiamondWeb have not been announced.
MICROSOFT DID THREATEN US, VENDORS TELL WEEKLY
It might just be that everyone is too nervous of Microsoft Corp to go on the record. Several personal computer manufacturers told US PC Week that Microsoft Corp did use various pressure tactics to persuade them to emphasise Internet Explorer over Netscape Communications Corp's Navigator, the paper says. Two told it that Microsoft has threatened to re-evaluate Windows 95 licensing fees if competing products, such as Navigator, are bundled on their systems, and one alleged Microsoft is also withholding participation in marketing programes with vendors that bundle both Navigator and Explorer, instead of just the latter. Another said Microsoft tried to raise its Windows 95 fee when the vendor requested that Microsoft remove Explorer 3.0 from the OS.
PSINET LAUNCHES WEB-
HOSTING SERVICE
Herndon, Virginia-based Internet service provider PSINet Inc has launched its PSIWeb Web hosting service to help companies offer improved response times to their Web site visitors. PSINet puts the companies' Web pages on its own Internet optimized backbone rather than having firms store them on their own servers.
The benefit is that Web surfers get faster access to pages, thus helping prevent criticisms of poor Web performance, the company said. "If you can't ever get onto a company's Web site, it creates a bad impression of the company," said Dorothy Briggs, PSINet marketing director. "Company Web sites need to be of the same quality as other forms of media." PSIWeb offers four levels of service: the basic service starts at £200 and gives the firm pages on a shared server. The top service provides companies with their own server and a guaranteed bandwidth.
AOL REJECTS GERMAN CHILD PORNOGRAPHY CHARGE
America Online Inc's German joint venture AOL Bertelsmann Online last week denied responsibility for distributing child pornography. Reacting to an investigation opened by Hamburg prosecutors, the company said in a statement: "AOL Bertelsmann Online completely rejects the accusation of spreading child pornography." All online services came under close scrutiny following media reports that some subscribers were using their electronic mail facilities to transmit illegal hard-core porn graphics. With 100,000 German subscribers, AOL was inevitably caught in the firing line being part of one of the largest online service providers in Europe, the fastest growing in Germany, and the number one provider in the US. The venture between America Online and German media conglomerate Bertelsmann AG blamed "black sheep" subscribers for sending pornographic pictures by electronic mail.
SANTA CRUZ OPERATION TO BUNDLE ORACLE WEBSERVER
Santa Cruz Operation Inc is to begin reselling Oracle WebServer 2.0 for OpenServer in an Internet product bundle when Oracle Corp's product is finally up under OpenServer early next month.
It will also offer WebServer 2.0 for UnixWare 2.1 to OEM customers and large corporates before packaging that in a bundle towards the year-end. WebServer will actually be one of Santa Cruz's so-called layered products for its Internet family of products. These sit on top of either OpenServer or another, its FastStart Internet bundle. FastStart is a bundle of an enhanced version of OpenServer, PPP protocol software, Netscape Communications Corp's Web Commerce and Proxy servers, an Internet Protocol to Internet Protocol gateway, Navigator browser and some of Santa Cruz's Vision family of products, as well as security and other software
The firm will also announce FastStart Internet Bundle 2.0 last week, which will include some updated Netscape software, among other enhancements. The agreement will continue when WebServer 3.0 becomes available in the autumn. Oracle Corp is also in the process of implementing its WebServer 2.0 for HP-UX, Windows NT and Solaris on iAPX-86.
UUNET HAS ONLINE COMMERCE
UUNet Technologies Inc's UUNet Pipex has launched The Bureau, for secure Internet commerce here and now, it claims, although it cannot name the four merchants signed up yet, and it hasn't bought fast enough computers yet either. The UK's National Westminster Bank Plc will act as the clearing house for all online debit and credit card transactions, currently set up for MasterCard and Visa only, but will encompass other payment methods in future.
Merchants are responsible for their own front end Web pages, The Bureau deals with all the back-end business, including real-time payment authorisation and collection of monies; customers register once with The Bureau, then buy from any merchant using an online shopping basket; entry level for Pipex dial customers is a one-off £500 set up fee; the main service for larger merchants costs £5,000 set up, £5,000 a year, plus a 5% transaction fee, UUNet Pipex said.
THE NAVIO PLAN - TO ESCAPE WHERE MICROSOFT CAN'T FOLLOW
Netscape has created a Navio Communications Inc subsidiary to develop internet software for the consumer market - anything from cars to games consoles - aimed at non-PC users, but based on stripped-down versions of its Navigator Web browser software. The aim is to go "where the PC can't and is not likely to go," said Netscape co founder Jim Clark, who is also chairman of both companies. And where the PC can't and won't go, Netscape's obviously hoping Microsoft Corp can't either and won't try to follow.
As to the type of products, details were sketchy, with Navio insisting it was just a company announcement. None of the partners was even present. Navio chief executive Wei Yen identified three areas in which the products - due "sometime next year" - will be used. The first is television-centric environments, such as game consoles, set-top boxes, and Digital Video Disk (DVD) systems. The second is communications devices, including Personal Digital Assistants (PDAs), cellular and other telephones. Yen said this category may subsume into one device before long. And lastly, the information terminal, by which Yen meant network computers, kiosks and other home appliances.
He said the first batch of all three categories of products is likely to released around the same time next year. The Navio software will be based on Navigator technology and will run on devices with embedded, real-time operating systems or no operating systems at all, supporting all the standards that Navigator supports.
DYNAMICALLY DOWNLOADABLE
Navio software will be modular and dynamically downloadable. Netscape is readying a modular version of Galileo (OR issue 13), the next version of Navigator, version 4.0. The full version is due at the end of the year, with the modular version early next year. The Navio modular software is at least "connected" with the modular Navigator work, according to the company. In other words, if a specific Navigator module is already there, it won't be re-written for Navio. The Navio browsers, as it's still calling them, will reformat output for televisions and devices such as phones that only have space for a few lines of text. The Navigator team will provide the knowledge as far as Java, security and objects. The software will be extensible via plug-ins.
Clark chose his old Silicon Graphics Inc colleague Yen to be Navio president and chief executive. Yen left his post as SGI senior VP products and technologies in March this year.
The make-up of the new company, based a few blocks down the street from Netscape in Sunnyvale, California, was not disclosed, other than that Netscape has a "major equity position." Marc Andreessen, Netscape's co-founder and chief technology officer, reckons the market for the Navio software is at least 500 million users in five years' time. If all the PCs - about 240 million at the moment - phones, consoles, pagers, cars, televisions and practically everything else that moves and everything that doesn't are included, then that number is clearly conservative, and pretty meaningless. But Netscape is fast out of the blocks in signing up all the games console companies that matter, together with IBM and Oracle, as well as some others that it declined to talk about, even though deals are not thought to be exclusive.
Yen claimed, "The Internet will be important as electricity to consumer devices in the next century," and Andreessen predicted an Internet device "on every desk and in every backpack," eventually. Andreessen said because of the extra advertising opportunities, the potential for giving consumer Internet devices away for free was even greater than with cellular phones, which are already given away in many markets, and are also ideal Internet devices. He wondered whether some sort of consumer Internet access device might be bundled on the front of a magazine, or even come with a pizza box.
As for the reason for a subsidiary, he likened the setting up of Navio to that of the Actra Business Systems LLC joint venture with GE Information Services unit of General Electric, in that Netscape will address opportunities with separate management teams, even though the technology might be shared. Navio is set up in such a way "to have no impact on Netscape's bottom line," according to Clark, which presumably means the parent will not split out the numbers.
Clark said having his name at the top of the company usually meant a public offering at some point in the future, before adding that "employees like to have that to look forward to." It remains to be seen whether this move will enable Netscape/Navio to create a large enough market on the non-PC front fast enough to balance the threat of Microsoft gobbling up its dominant, but declining PC browser market share. But, together with Netscape's continuing good showing on the web server front, it might just be enough. - By Nick Patience
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WEEKLY DISPATCHES FROM THE INTERNET FRONT
September 2 - 6 Issue No 14
DEC SPINS OUT ALTAVISTA
Digital Equipment Corporation announced last week that it had filed with the Securities and Exchange commission to put 20 percent of its AltaVista Internet software business up for public offering.
DEC officials say that under the structure of the IPO they would also roll their entire Internet Software division into AltaVista. They say that the number of shares to be released has not yet been determined, but the filing reports that $50 million would be the maximum proceeds - not bad for one fifth of a division that has lost money since day one.
Despite the obvious implication, DEC denies that the scheme is an attempt to scrape together some cash after four years in the red. It say that it's got $2 billion in the bank and that the point of the IPO is to allow the subsidiary to focus on Internet software while giving it some working capital.
UK ISP BODY LOSES POLITICAL HEAD AS CIX AIMS GLOBAL
As politicians become increasingly interested in the regulation of the Internet, service providers are still a long way from gaining a unified voice. Late last week, Peter Dawe the political officer of the the UK Internet Service Provider Association tendered his resignation as the country's providers fell out over the best way to respond to efforts by the police to crack down on pornographic newsgroups. Dawes was heading a UK-driven effort to muster support for a pan-European ISP organisation, which now seems likely to founder.
At the same time, however, the mainly-US Commercial Internet eXchange (CIX) is actively moving ahead with its plans to become an international voice for the Internet trade. CIX VP and board member Glenn Kowack said "it can be taken as a given" that CIX's board will go ahead with proposals to begin active recruitment in Europe and Pacific Rim and is in the process of organising representation in the two areas. CIX's role will be to try to educate and steer law-makers before they decide that Internet regulation is necessary. "Often the old, tired regulatory directions simply won't work" he said. CIX is actively pursuing relationships with the International Telecommunications Union, the World Trade Office (set up as a result of GATT 2) and the World Intellectual Property Office. It is also targeting the European Community Commission. CIX is aware that trying to impose a single ISP voice across continents won't work says Kowack. "Rather than trying to drive a structure down into various companies, we have put out a call to our members to start regional bodies", he says. "It could be that there will be a CIX European Chapter, for example" he added. Over the last year and a half CIX has gradually been transforming itself from a simple organiser of interconnections between ISPs into a lobbying group.
Dawe's resignation shows how difficult it is for ISPs to reach consensus in even one country. Faced with calls from the police to
NETSCAPE GARNERS LUKE-WARM SUPPORT FOR 'NAVIO' EFFORT
Last Monday Netscape Communications Inc. trotted out company bigwigs Jim Clark and Mark Andreesen to announce the formation of a new subsidiary, Navio Communications Inc, which is supposed to extend Netscape's Navigator technology to the lucrative consumer electronics market. In addition to Netscape's controlling interest, the company is financed by seven other interests, but nobody is saying who these investors are. Netscape did announce that six companies - Nintendo, Sony, Sega, NEC, IBM and Oracle - were "backing" the initiative, but was ambiguous as to what "backing" actually meant. When contacted, Sony, Nintendo and Oracle were quick to downplay their commitment to Navio. Sony's response was typical, with a spokesman saying "our engineers have been involved in preliminary discussions regarding technology issues of mutual interest" and asserting that Sony has no product plans at this time. NEC at least admitted that it hoped to use Navio technology in its upcoming network TV - when that would be, well NEC wouldn't comment.
So it seems that nobody but Netscape is willing to admit any commitment to Navio beyond a pat on the back for sticking it to Microsoft, yet Navio officials predict revenues by the first quarter of 1997. Netscape admits that the consumer electronics market is more complicated than Netscape's traditional battlefield. Navio's product will have to be customized for a large number of individual devices and operating systems and this, according to Senior Vice President of Technology Mark Andreesen, "will take a lot of breakthroughs".
Still, the consumer market represents a huge volume of sales - at least 500 million according to Netscape - and it has the advantage of being one place where Microsoft is not already entrenched. Furthermore, Netscape may be able to capitalize on some antipathy toward Redmond. As Jupiter Communications analyst Adam Schoenfeld points out, "most of the people involved in non-PC devices are there because Microsoft basically kicked them up and down the vineyard in PCs and PC devices". According to
BLOCK KEEPS COMPUSERVE
News of re-structuring and falling subscribers has halted the spin-out of Compuserve. H&R Block Inc of Kansas City, now believes prospects for the online bisiness as a free-standing company are so poor that it has abandoned its plan to spin off the 80% it still owns after the spring flotation by handing out shares to its shareholders, and will now hold on to them. The shares were floated at $30 in April and are now down at $12.50.
Block is hanging on because of CompuServe's recent and projected losses and market uncertainties regarding the on-line industry but is left in the worst of all possible worlds because, with CompuServe shares trading, it can't decently hide just how badly the company is doing in its own figures. It says it is still comitted to separating the sharehodings, but gives no date
WORLDCOM'S SHARE-PRICE
TUMBLES AS BELLS CIRCLE
No sooner had WorldCom Inc announced that it planned to acquire MFS Communications Inc in a share exchange originally valued at $14,000m than the price was rapidly trimmed to $11,500m as WorldCom's share price went into a decline. Meanwhile, the top brass at the soon-to-be five Baby Bells rushed to feed the numbers into their spreadsheets and try to decide whether to spoil the party by bidding for WorldCom now, or wait until completion and gobble the whole lot up.
Their cash flow is such that even the smallest could afford the one big chance left to get into the long-distance and international business at a stroke. That prospect has - at least temporarily - given WorldCom a market capitalization that means the combination would outrank MCI Communications Corp in valuation, even though the latter is vastly bigger at $15,250m, a year compared with $5,400m for the WorldCom-MFS combination. WorldCom, Jackson, Mississippi is the combination of LDDS Communications Corp with the WilTel business of Williams Cos: the combination created a US-wide network of fibre-optic cable, most of it laid in disused pipelines.
WorldCom also has an international telephony dimension by virtue of its acquisition of satellite operator IDB Communications Corp. MFS - formerly Metropolitan Fibre Systems - of Omaha, Nebraska is a builder and operator of Metropolitan Area Networks, and to link these together for its customers has had to lease capacity - from the likes of WorldCom. It has begun building networks in Europe where it is permitted to do so - currently the UK, Germany and France. It also has one of the biggest Internet access providers in the shape of UUNet
Technologies Inc, so the combination creates a one-stop shop for local, long-distance, international and Internet access =services. WorldCom is clearly the more attractive of the two for a Baby Bell, and in recognition of this, the partners have moved to make it more expensive for outsiders to muscle in by setting a $350m break-up fee, while WorldCom has put in place a poison pill that can be activated if a hostile bidder picks up 15%. The combined company - to be known as MFS WorldCom - will have a 25,000-mile end-to-end fibre network connecting all the major metropolitan areas of the US. Since the company will own its own local and long-distance facilities, it will not be bound by the regulatory restrictions facing the Bells - which have to prove that their local markets are open to competition before they can offer long-distance services - but will instead qualify for preferential treatment under the Federal Communications Commission's new Interconnection rules. WorldCom will pay 2.1 new shares for each MFS out, at $55.39 a share, a premium of 58% to the MFS price at announcement time, although it was soon trimmed to $47 by the fall in WorldCom's shares. WorldCom warns of three years of earnings per share dilution from the acquisition, which may make holders think twice about approving it rather than selling to a Bell.
MICROSOFT BACK-PEDALS ACTIVEX STANDARDISATION
Microsoft appears to be in the full-flush of damage control brought on by what Microsoft EVP Steve Ballmer last week called a "naive" move to thrust ActiveX into an independent standards body, reports sister paper ClieNT Server News .
According to what Ballmer said in a press Q&A following his keynote Thursday at the Windows NT Intranet Solutions show in San Francisco, Microsoft is redefining what ActiveX is so the core of Redmond's precious COM, DCOM and possibly some bits of OLE object technologies remain outside the standards body's province.
For the five months it has existed, ActiveX has been nothing more than an ambiguous marketing term whose published definitions have all conflicted making it easier for Microsoft to declare it anything it wants to. According to an overhead Ballmer threw up last week, ActiveX is limited to controls, scripting, document objects and accessibility. These are the pieces that would be consigned to the prospective standards body, he said, barring outright revolt of the people who attend the ActiveX summit that's meant to adjourn at some still-unannounced time and place late in September, having been bumped from August. Of course, it should probably be pointed out that Microsoft controls the invitation list though competitors are expecting to attend
To be fair, Ballmer did appear to leave some room for negotiating what would go into the standardization process. As to why Microsoft remains mute on the time and place of the one-day summit which was originally supposed to decide on whether ActiveX would go into a new or existing standardards organization and how that transition would be made, Ballmer said, "It's kind of a tricky thing. There's more political complexity than we anticipated. So we're taking our time." Ballmer's statements appear to support the widely-held conclusion that Microsoft's sudden standards body proposal was hasty and ill-considered as to its ramifications. Its enemies at least have maintained that it would backpedal off it as soon as it could - hence the myriad excuses for the delay.
VENTURE CAPITAL TARGETS MANHATTAN'S INTERNET START-UPS
Chase Manhattan Corp has teamed up with insatiable Softbank Corp of Tokyo, and each will invest $25m in a new venture capital fund which will focus on Internet-related companies specifically based in New York. The common perception is that all the interesting Internet-related technical developments are taking place on the US' West coast, but there are an estimated 700 multimedia and Internet companies in Manhattan's so-called Silicon Alley - the small patch of downtown between the Flatiron building and the SoHo area. Many are starved of seed capital.
The development, is called Flatiron Partners, and so far, Chase's venture capital arm, Chase Capital Partners, and the Japanese magazine and software publisher are the only investors in the fund. The fund will not confine itself to New York if something really hot (apart from pollution) comes in from Jersey - or even further afield on the East Coast, but the emphasis will remain on new-media and Internet-related companies in the creative heart of Manhattan.
The partners have tapped Jerry Colonna, a former partner in the CMG Ventures Fund that financed World Wide Web search company Lycos Inc before it went public earlier this year, and Fred Wilson, a former partner in the Euclid Partners New York venture fund to run the new operation. And each partner also says it may also directly invest up to another $50m in companies financed by Flatiron. No-one is talking officially, but the fund has reportedly already invested $4m in Yoyodyne Entertainment Inc, a company based in Irvington, New York and formed to develop sweepstakes and promotional games for the World Wide Web. The potential of the new fund is underlined by the fact that about half the recent seed capital deals have been Internet-related, but most have been in California.
l Meanwhile Venture capitalists Kleiner Perkins Caufield & Byers was receiving over 100 calls a day on their fund last week - mostly from interested start-ups looking to cash in. The .$100 million Java fund (OR issue 12) is backed by industry heavyweights like Sun Microsystems, Netscape and IBM. It will invest in 20-30 companies over the next 10 years.
Kleiner Perkins Associate Michael Palmer says that the fund will consider plans
from companies whose products are "Java related in the broadest sense" and will choose those that represent a unique and strong market opportunity. He adds that the creation of the fund certainly sends a message to the industry that venture capitalists are interested in Java. Calico Technology, Marimba and Active Software have already been funded.
VERISIGN AND JAVASOFT JEEVES REFUGEES FORM START-UP
The brain-drain at JavaSoft continues. Last week members of its Jeeves server project defected to launch their own Internet startup company, innovatively code-named Internet Startup. The company has over $1 million in VC money behind it, thanks to Menlo Park's Bessemer Venture Partners. David Cowan, a general partner with Bessemer will be the new company's CEO. Cowan also happens to sit on the board of digital authentication company, VeriSign, Inc.
The week-old startup is not yet ready to announce products, but according to its VP of Marketing, Chris Zuleeg, Bessemer identified what will become an obvious and compelling customer need six months down the line and recruited the ex JavaSoft employees to develop a solution. VeriSign is best known for providing authentication technology like SET compliant digital certificates and Jeeves is Sun's Java-powered Internet server, so it seems likely that Internet Startup will be providing some kind of server side authentication software, though Zuleeg says that the final product will include both client and server software.
The product, he adds, will make it easier for networked applications to become ubiquitous. Sun's Jeeves technology, which is currently available free of charge at www.sun.com, makes use of servlets - server side applets - to write cross platform database plug-ins in Java. Whatever Internet Startup ends up shipping, it is expected to be in beta 9 months from now. Internet Startup expects to be giving away its software at first, and charging once it has market share.
BSKYB PLANS SATELLITE INTERNET
High-speed Internet access will be one of the services to be provided to subscribers to digital television services in the UK and Germany. British Sky Broadcasting Plc reckons that only about 15% of UK homes have personal computers, so it is ordering up a television set-top box decoder with the power of a personal computer - and will have to subsidise it heavily. No word on the processor - or even whether a specific processor has been chosen, but according to Electronic Times, specifications sent to those tendering to build the boxes include integration of a 100Mbps IEEE1394 serial bus interface and a fast modem link. The interface will support everything from home audio systems to printers, and will provide a fast link to personal computers. BSkyB also plans to offer home banking, home shopping and other interactive services. The satellite broadcaster is also demanding advanced MPEG functions such as handling mosaics of eight windows on-screen, so that you can follow up to eight individual cars in a Grand Prix - while people actually at the event can't see anything through all the cameras. And in Germany, Bertelsmann AG says that its Mediabox digital television decoder will also support Internet access. The Mediabox was developed jointly by Bertelsmann and Canal Plus SA, in competition with Bavarian mogul Leo Kirch's D-Box.
AUTONOMY INTENDS TO TURN ISPS INTO 'KENNELS'
Cambridge Neurodynamics spin-off Autonomy, Inc. has transplanted itself from England to Palo Alto California and has released the first parts of its Autonomy suite of applications in beta code. The software alledgedly uses neural network technology to "learn" what kind of information users are seeking and then, using any Internet browser, goes out to retrieve it from Web sites and email folders.
Though it is interesting to see the small cartoon dog snuffle its way around the Net, this kind of client-side searching requires that users stay connected to the Internet for long periods of time, while the software does its snooping.
Autonomy is considering two possible ways around this, both of which it plans to roll out in the next quarter. The company is working on deals with ISPs to allow Autonomy's intelligent agents to continue searching the Web while disconnected from their host user - a process it calls 'kenneling'.
Service providers would license kenneling technology from autonomy as a draw to their subscribers. Autonomy CEO Drew Harman says that Autonomy's technology could also be used as a sort of replacement for traditional search technology on Web sites, a process he calls concept indexing. However concept is far more complicated than traditional keyword indexing and therefore requires more computational power. But why not do concept indexing on the contents of an entire search engine like Yahoo or Lycos?
Harman says that this is not feasible right now: "You'd have to have some pretty monstrous machines to do a concept index of the World Wide Web." Autonomy will be available online in October and in retail outlets by January.
JAVA DECOMPILER GETS PULLED
Freelance software engineer Hanpeter van Vliet is reconsidering whether his Mocha Java decompiler is suitable for public consumption following some nasty letters from US software vendors.
After posting the software for free on his Website, the Dutch programmer says that he was contacted by lawyers from of a number of companies expressing their concern that the decompiler, which converts Java bytecode into source code, could be used to copy and reuse proprietary Java applets. He says that the threat of a liability suit caused him to pull Mocha off of his Website and seek legal counsel.
Van Vliet asserts that the point of Mocha was never to create a way of ripping off Java code. He adds that pulling Mocha out of circulation is not likely to stop anyone from decompiling Java bytecode. Any competent programmer with enough free time and nefarious intent could develop such an application on his own. To see whether the Internet community wants Mocha to stay or be eradicated van Vliet is polling visitors to his site on the issue. So far, the vote is 10 to one in favor of bringing Mocha back. With or without Mocha, van Vliet will continue posting software on his Website. Next week he conveniently plans to release what he calls an obfuscator, named Crema, on his Website. Crema will prevent decompilers like Mocha from working.
http://web.inter.nl.net/users/H.P.van.Vliet/mocha.htm
NETSCAPE GRABS OS/2, MAC
Microsoft may have Internet Explorer bundled with Windows, but Netscape appears to be making a concerted attempt to get its browser bundled with everything else. Last week it announced deals with Apple and IBM that will see Navigator bundled with Mac and OpenDoc respectively. Netscape will develop an OpenDoc component version of its browser that will become the default browser within Apple's rather nice Cyberdog Internet suite. The Netscape module will replace CyberDog's existing browser. But there is no indication that there will be Netscape modules covering News, mail and FTP - which Cyberdog already has. Apple says that the Netscape browser will eventually be incorporated into the operating system. Netscape Navigator for Cyberdog will allow users to embed browsing capabilities in other OpenDoc-compatible applications. Apple says that an OpenDoc-supported word processor will able to incorporate live links to Web sites that would provide continuously updated information. Just how useful that is remains to be seen.
On the OS/2 side, Netscape will develop a version of Navigator 2.02 and have it in beta by September and available by year end "shortly after the launch of OS/2 Warp 4." All copies of Warp 4.0 will get a copy of the OS/2 Navigator. More interesting is the joint development of Navigator 4.0 for OS/2 which is vaguely scheduled for some time next year. Neither IBM nor Netscape are saying anything about it, other than it will be modular, as will all the Navigator 4.0 offerings. Whether it too uses OpenDoc will test IBM's commitment to the technology.
LOTUS PROMISES WEB APPLICATION COMPONENTS
Alongside its Domino Web application server, Lotus Development Corp will also try to proliferate Notes across the Internet by offering Web-enabled versions of its current OCX- and ActiveX-based Lotus Components application building blocks from next year. The idea is that Web developers will use the Components - current examples include Chart, Comment, Draw/Diagram, File Viewer, Project Scheduler, Spreadsheet and Component Template Builder - within Web applications. Users will activate a Lotus component with their browsers to access and run the application. Lotus says a brokerage house could use the Components to create an Internet application which queries investment portfolios. When posted to the Web site customers would be able query their portfolios and use the Spreadsheet and Chart components to analyze and display their data. Meantime Lotus says it's now shipping ActiveX versions of the six core Components (not Web-enabled) in a starter pack at $50 per client seat. Later this year it will offer Lotus Components Product Warehouse, a Notes 4 application allowing for distribution of Lotus Components and license monitoring within an organization. The next version of Lotus Word Pro, which will ship as a part of SmartSuite 97 in the fourth quarter, will include a container for Lotus Components.
MITSUBISHI AND SONY BOTH INTRO TV-BROWSER COMBOS
Last week Japanese consumer electronics heavyweights Mitsubishi Consumer Electronics and Sony Electronics Inc. both announced devices that let users browse the Internet using their televisions. Mitsubishi's DiamondWeb television is the more ambitious of the two. DiamondWeb will be an integrated big-screen television/Internet appliance incorporating Motorola's MPDC801 PowerPC chip and Microware's OS-9 operating system. Mitsubishi says it will announce who is providing the browser software next week. Because the graphics processor on DiamondWeb will be feeding signal directly to the set's cathode ray tube, Mitsubishi figures it will turn out better performance than Sony's effort.
Mitsubishi is still evaluating the possibility of providing a plug-in box like Sony's to its legacy customers. Sony's box, called Sony WebTV, is being manufactured under license from WebTV Networks, which also just happens to be the ISP for the initiative. It is expected to ship by September at a cost of $349. Pricing and availability of DiamondWeb have not been announced.
MICROSOFT DID THREATEN US, VENDORS TELL WEEKLY
It might just be that everyone is too nervous of Microsoft Corp to go on the record. Several personal computer manufacturers told US PC Week that Microsoft Corp did use various pressure tactics to persuade them to emphasise Internet Explorer over Netscape Communications Corp's Navigator, the paper says. Two told it that Microsoft has threatened to re-evaluate Windows 95 licensing fees if competing products, such as Navigator, are bundled on their systems, and one alleged Microsoft is also withholding participation in marketing programes with vendors that bundle both Navigator and Explorer, instead of just the latter. Another said Microsoft tried to raise its Windows 95 fee when the vendor requested that Microsoft remove Explorer 3.0 from the OS.
PSINET LAUNCHES WEB-
HOSTING SERVICE
Herndon, Virginia-based Internet service provider PSINet Inc has launched its PSIWeb Web hosting service to help companies offer improved response times to their Web site visitors. PSINet puts the companies' Web pages on its own Internet optimized backbone rather than having firms store them on their own servers.
The benefit is that Web surfers get faster access to pages, thus helping prevent criticisms of poor Web performance, the company said. "If you can't ever get onto a company's Web site, it creates a bad impression of the company," said Dorothy Briggs, PSINet marketing director. "Company Web sites need to be of the same quality as other forms of media." PSIWeb offers four levels of service: the basic service starts at £200 and gives the firm pages on a shared server. The top service provides companies with their own server and a guaranteed bandwidth.
AOL REJECTS GERMAN CHILD PORNOGRAPHY CHARGE
America Online Inc's German joint venture AOL Bertelsmann Online last week denied responsibility for distributing child pornography. Reacting to an investigation opened by Hamburg prosecutors, the company said in a statement: "AOL Bertelsmann Online completely rejects the accusation of spreading child pornography." All online services came under close scrutiny following media reports that some subscribers were using their electronic mail facilities to transmit illegal hard-core porn graphics. With 100,000 German subscribers, AOL was inevitably caught in the firing line being part of one of the largest online service providers in Europe, the fastest growing in Germany, and the number one provider in the US. The venture between America Online and German media conglomerate Bertelsmann AG blamed "black sheep" subscribers for sending pornographic pictures by electronic mail.
SANTA CRUZ OPERATION TO BUNDLE ORACLE WEBSERVER
Santa Cruz Operation Inc is to begin reselling Oracle WebServer 2.0 for OpenServer in an Internet product bundle when Oracle Corp's product is finally up under OpenServer early next month.
It will also offer WebServer 2.0 for UnixWare 2.1 to OEM customers and large corporates before packaging that in a bundle towards the year-end. WebServer will actually be one of Santa Cruz's so-called layered products for its Internet family of products. These sit on top of either OpenServer or another, its FastStart Internet bundle. FastStart is a bundle of an enhanced version of OpenServer, PPP protocol software, Netscape Communications Corp's Web Commerce and Proxy servers, an Internet Protocol to Internet Protocol gateway, Navigator browser and some of Santa Cruz's Vision family of products, as well as security and other software
The firm will also announce FastStart Internet Bundle 2.0 last week, which will include some updated Netscape software, among other enhancements. The agreement will continue when WebServer 3.0 becomes available in the autumn. Oracle Corp is also in the process of implementing its WebServer 2.0 for HP-UX, Windows NT and Solaris on iAPX-86.
UUNET HAS ONLINE COMMERCE
UUNet Technologies Inc's UUNet Pipex has launched The Bureau, for secure Internet commerce here and now, it claims, although it cannot name the four merchants signed up yet, and it hasn't bought fast enough computers yet either. The UK's National Westminster Bank Plc will act as the clearing house for all online debit and credit card transactions, currently set up for MasterCard and Visa only, but will encompass other payment methods in future.
Merchants are responsible for their own front end Web pages, The Bureau deals with all the back-end business, including real-time payment authorisation and collection of monies; customers register once with The Bureau, then buy from any merchant using an online shopping basket; entry level for Pipex dial customers is a one-off £500 set up fee; the main service for larger merchants costs £5,000 set up, £5,000 a year, plus a 5% transaction fee, UUNet Pipex said.
THE NAVIO PLAN - TO ESCAPE WHERE MICROSOFT CAN'T FOLLOW
Netscape has created a Navio Communications Inc subsidiary to develop internet software for the consumer market - anything from cars to games consoles - aimed at non-PC users, but based on stripped-down versions of its Navigator Web browser software. The aim is to go "where the PC can't and is not likely to go," said Netscape co founder Jim Clark, who is also chairman of both companies. And where the PC can't and won't go, Netscape's obviously hoping Microsoft Corp can't either and won't try to follow.
As to the type of products, details were sketchy, with Navio insisting it was just a company announcement. None of the partners was even present. Navio chief executive Wei Yen identified three areas in which the products - due "sometime next year" - will be used. The first is television-centric environments, such as game consoles, set-top boxes, and Digital Video Disk (DVD) systems. The second is communications devices, including Personal Digital Assistants (PDAs), cellular and other telephones. Yen said this category may subsume into one device before long. And lastly, the information terminal, by which Yen meant network computers, kiosks and other home appliances.
He said the first batch of all three categories of products is likely to released around the same time next year. The Navio software will be based on Navigator technology and will run on devices with embedded, real-time operating systems or no operating systems at all, supporting all the standards that Navigator supports.
DYNAMICALLY DOWNLOADABLE
Navio software will be modular and dynamically downloadable. Netscape is readying a modular version of Galileo (OR issue 13), the next version of Navigator, version 4.0. The full version is due at the end of the year, with the modular version early next year. The Navio modular software is at least "connected" with the modular Navigator work, according to the company. In other words, if a specific Navigator module is already there, it won't be re-written for Navio. The Navio browsers, as it's still calling them, will reformat output for televisions and devices such as phones that only have space for a few lines of text. The Navigator team will provide the knowledge as far as Java, security and objects. The software will be extensible via plug-ins.
Clark chose his old Silicon Graphics Inc colleague Yen to be Navio president and chief executive. Yen left his post as SGI senior VP products and technologies in March this year.
The make-up of the new company, based a few blocks down the street from Netscape in Sunnyvale, California, was not disclosed, other than that Netscape has a "major equity position." Marc Andreessen, Netscape's co-founder and chief technology officer, reckons the market for the Navio software is at least 500 million users in five years' time. If all the PCs - about 240 million at the moment - phones, consoles, pagers, cars, televisions and practically everything else that moves and everything that doesn't are included, then that number is clearly conservative, and pretty meaningless. But Netscape is fast out of the blocks in signing up all the games console companies that matter, together with IBM and Oracle, as well as some others that it declined to talk about, even though deals are not thought to be exclusive.
Yen claimed, "The Internet will be important as electricity to consumer devices in the next century," and Andreessen predicted an Internet device "on every desk and in every backpack," eventually. Andreessen said because of the extra advertising opportunities, the potential for giving consumer Internet devices away for free was even greater than with cellular phones, which are already given away in many markets, and are also ideal Internet devices. He wondered whether some sort of consumer Internet access device might be bundled on the front of a magazine, or even come with a pizza box.
As for the reason for a subsidiary, he likened the setting up of Navio to that of the Actra Business Systems LLC joint venture with GE Information Services unit of General Electric, in that Netscape will address opportunities with separate management teams, even though the technology might be shared. Navio is set up in such a way "to have no impact on Netscape's bottom line," according to Clark, which presumably means the parent will not split out the numbers.
Clark said having his name at the top of the company usually meant a public offering at some point in the future, before adding that "employees like to have that to look forward to." It remains to be seen whether this move will enable Netscape/Navio to create a large enough market on the non-PC front fast enough to balance the threat of Microsoft gobbling up its dominant, but declining PC browser market share. But, together with Netscape's continuing good showing on the web server front, it might just be enough. - By Nick Patience
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