The Online REPORTER
WEEKLY DISPATCHES FROM THE INTERNET FRONT
August 26 - 30 1996 Issue No 13
IBM THROWS R&D ONTO THE WEB, JAVA FOR WIN 3.1 ARRIVES
The mysterious alphaWorks project we reported on (OR issue 10) turns out to be an audacious attempt by IBM to accelerate the pace at which Internet technology, under development in the labs, is either turned into products, licensed or junked. IBMers from labs and individual skunk-works projects will submit their pet gizmos to a new Web site (www.alphaworks.ibm.com) for the world to download and evaluate. IBM is also hoping that it will improve sluggish communication within the company, bringing hot technologies to the notice of product managers within IBM. "We realised we had a dire need to figure out a better way to get these technologies out into the world," says alphaWorks manager, Andrew Morbitzer, "we want to get them out very early in the life cycle so we can quickly get the money behind the technologies". As part of the scheme, IBM has streamlined the intellectual property clearances that IBM researchers need to undertake before releasing technology. A Notes-based internal system has reduced the time for clearance (including name clearance, patent protection etc) to around three weeks in most cases, says Morbitzer - maybe six if there are complications.
The site debuts with six technologies, including the long-awaited Java system for Windows 3.1 (now named 'applet development kit for Windows 3.1', to avoid Java trademark issues). The others include: Bamba, a realtime audio and video streaming, encoding and player package which IBM reckons outperforms both RealAudio and VDONet. Another, Panoramix, sounds as if it should give Apple's Quicktime VR a run for its money. It is claimed to let Internet users construct panoramic views of landscape or rooms without the need for a special camera.
EXPLORER SECURITY LOOPHOLE BLAMED ON MACROS
By the time you read this, Microsoft should have a new version of Internet Explorer 3.0 available that fixes a potentially serious security loophole. Last Wednesday, Princeton University's Ed Felton and Birk Balfanz used the comp.risks newsgroup to announce a flaw that lets an attacker run any DOS command on a visiting browser's machine. An attacker could read, delete or modify a victim's files.
Microsoft was promising a fix by the end of the week as we went to press and the Princeton duo aren't giving away details until Microsoft has solved the problem. However, the fault centers on Explorer's ability to automatically display Word or Excel files that may contain macros. Usually Explorer displays a warning before downloading such potentially dangerous files - asking for permission. But the researchers have discovered a way by which attackers can circumvent this, and say they have verified the hole by putting together a Web page that automatically deletes a file from a visitor's machine. Internet Explorer has the ability to view Word and Excel documents, either by launching the applications themselves, or by invoking a stripped-down viewer. However the viewer cannot run macros.
Ed Felten told Online Reporter that the bug may also affect ActiveX components, but that this has yet to be verified.
Those feeling restricted by .com or .net international domains should be able to bid to run other domain registries by October (OR issue 1). Assuming some business issues are tidied up, a new ad hoc committee should be formed by early September to produce the specifications for those wishing to run a domain name registry. Applications for the first tranche will be taken until the end of November, and by early January the commitee will have selected the (up to 50-odd) winners. The Internet Society will then sign contracts with them, with the aim of getting the new registries up by the end of January. The commitee will be appointed by the Internet Assigned Numbers Authority, the president of the Internet Society and the chair of the Internet Architecture Board.
However an initial report on C/Net last week, quoting IANA chief Jon Postel on the plan, caused annoyance on the mailing list designed to thrash out the changes. Many correspondents were surprised that Postel's draft proposals were being accepted without the list being notified.
CEO of the Internet Society, Don Heath, confirmed the October timescale was on the cards, but said that this assumed that a number of business issues, such as charging and handling conflicts between organizations who apply for the same domain names, could be fixed. "There are several things that need to be sorted out, including rate structures and fees," he said. Postel is proposing that domain registries pay a fixed $2,000 per year fee plus 2% of their domain-derived revenue to the Internet Society, to help fund infrastructure.
The move is a curious departure from the regular IETF mechanism which sees draft proposals elevated to the Internet Engineering Steering Group once they have survived peer-review-by-fire on the mailing-lists. Heath said that Postel's proposals were accepted in principle by the Internet Society's board of trustees as long ago as June, with the proviso that the business issues be firmed up. The period of public debate has now essentially ended and the decisions on the final issues "will be done between Postel and people within the Internet Society", said Heath.
"The IETF/IESG process is really good for
I'Soc steams ahead with new domain scheme - apply October
If the eventual standards home of ActiveX remains a mystery, so does the timing of the meeting which is supposed to decide its fate. As previously reported, the meeting has slipped from its original mid-August time frame to... well, no-one knows. Not even, it seems, the Burton Group which is meant to be organizing the thing. The latest gossip has it that Tim Berners-Lee, director of the W3C, has decided that the Consortium is an inappropriate vehicle. That might account for the delay since the W3C is one of Microsoft's favoured options.
However a Consortium spokesperson vehemently denied that any decision had been taken, saying that anything is still possible.
AIM A STEP CLOSER TO WEB-TVS WITH COMPUSERVE DEAL
American Interactive Media Inc, the company that wants to put your television set onto the Internet for "much less than $500", has progressed with its plans to the point of signing CompuServe Corp to a multi-year agreement to become its Internet access provider.
Under the deal, buyers of American Interactive's set-top Internet access device, the price of which has now pared down to less than $400 (probably more than $400 with tax), will be offered unlimited access to the Internet and World Wide Web through CompuServe's Sprynet Internet access service. The access device includes hand-held remote control, and comes preloaded with a browser, electronic mail, a dialler and a printer driver. Users will get access to the Internet via a customised Internet "channel" that is being developed by American Interactive and CompuServe. There is no date for the launch of the new product.
Medford, New Jersey-based AIM licensed the television set-top box technology from Milton Keynes, UK company MSU Ltd
SCO SHOWS ITS NC OS - HDS TATUNG & ACER ARE INTERESTED
Santa Cruz Operation Inc's new NC/OS Network Computer operating system (OR issue 12) was being shown at the SCO Forum last week. As reported, It's a small-footprint version of Unix - and it's one that has been seen before. Previously it was sold as an environment for point-of-sale systems, but now it has Netscape Communications Corp's Navigator, a TCP/IP stack and some networking glue on top.
Crucially, it runs on standard Intel Corp processors, from an 80386 up. The operating system itself takes up 1.45MB, and with Navigator added, Santa Cruz reckons the whole thing requires no more than 8MB.
Scott McGregor, Santa Cruz's senior vice-president for product marketing, said the Navigator cache could either be held on a very small hard disk or in Flash memory. The operating system and browser can be held in ROM, he said. Santa Cruz apparently took just 45 days from concept to having the thing ready, hardly surprising as the kernel was already written and being used.
The company is currently hawking it round to any of its existing OEM customers that might be interested in building Network Computers. They apparently "went goo-goo" when they were shown it, according to vice-president for the Internet, Jeff Ait. Two are said to be ready to go with some sort of device, while around eight others are currently developing products, according to Ait. Other companies are being shown the operating system, including some in Taiwan and elsewhere in the Far East, including Tatung Co Ltd and Acer Inc, as well as some large US personal computer manufacturers, none of which Santa Cruz would reveal. One of them was said to be "very, very nervous" about word getting out that it was looking to build a Network Computer.
HDS Network Systems Inc, which claimed to be the first company anywhere with a Network Computer when it launched one back in June, is just about to start talking to Santa Cruz about possibly using the NC/OS, despite having its own Posix-compatible microkernel, which only takes up 300Kb, including Spyglass Inc's Web browser, as part of its Universal Client environment.
The NC/OS will appear in a variety of embedded systems in the near future according to McGregor - apart from point of sale systems - including handheld devices. McGregor said SunSoft Inc's Java OS can't compete at the moment, as it doesn't have any networking or systems management capabilities yet.
Things that were stripped out of Unix to make it fit in such a small space include symmetric multiprocessing support and large file management support. Santa Cruz hosted a Network Computer pavilion at the Forum last week, where numerous vendors will be showing their wares, including Sun Microsystems Inc, Apple Computer Inc, HDS, SunRiver Corp, Diba Inc, NetChannel Inc, Unisys Corp, Idea Corp, Akai Electric Co, ViewCall America Inc, Wyse Technology Inc and Maxspeed Corp.
IDT will attempt to breathe life into Genie, following buy-out
Hackensack, New Jersey-based IDT Corp said last week that it has bought the Genie Online Service from Yovelle Renaissance Corp for an undisclosed sum - all of which sounds a bit odd given that Yovelle was a vehicle formed for the purpose of buying the forgotten on-line bulletin board service from General Electric Co Inc's GE Information Services, and that IDT was said at the time to be "associated with" Yovelle.
But it appears that since the original announcement, IDT, Renaissance and General Electric have all been squabbling. Genie provides multi-player gaming, interactive chat and bulletin board services for 20,000 customers in the US, and IDT, Internet access and telephone service provider, gets rights to the Genie names and over 100Gb of content. The content will be incorporated into IDT's recently-introduced Genie Interactive service, a new on-line service optimistically designed to compete with America Online Inc and CompuServe Corp. Genie Interactive offers unlimited access to its content for a flat fee. IDT gets long-term access to the General Electric Information Services technical infrastructure to support the on-line service. Genie On-line service currently has 20 employees in its Rockville, Maryland facility and has over 60 system operators moderating discussion groups and adding to its special interest bulletin board services. The new Genie Interactive service will be run from IDT's Hackensack headquarters. IDT says that the deal, terms of which were not disclosed, amicably settles all the nastinesses between the parties.
SUN TAKES IBM MQSERIES FOR JAVA - MICROSOFT HAS FALCON
It looks like the next set of battle lines for those targeting the distributed-application market is going to be message passing. Sun Microsystems has licensed IBM's MQSeries messaging technology, used to handle messages between disparate systems over unreliable lines. At the same time Microsoft Corp's Falcon message-oriented middleware technology for Windows NT has gone into beta. Redmond is positioning Falcon as its own answer to MQSeries.
Falcon is designed to enable developers to build large-scale distributed systems with reliable communications between applications that can keep functioning even when the network goes down, using a common queueing system. Microsoft is working with Level 8 Systems Inc to make sure Falcon can integrate with "legacy" systems, a category in which it places MQSeries, as well as CICS.and Sun uses
TALIGENT WORK TO INTERNATIONALIZE JAVA
Sun Microsystems has been picking through what is left of Taligent Inc in the IBM Corp vaults, and has discovered something of value - the Taligent class libraries, which implement key components of the Unicode international character set.
It wants to incorporate them in Java so that developers can create global applications and applets in it. The class libraries mean that Java, written by programers working in American English, would automatically recognise the language differences of individual countries.
It has long been known that IBM was tinkering with Taligent, Java-ising parts of it. But IBM is not saying whether any similar deals, for other elements.
To return the compliment, IBM is licensing Sun's Joe, designed to enable businesses to deliver corporate Java applications to any system that is supported by the Java language. Joe links Sun's Neo object request broker to Java.
NETSCAPE TO BREAK UP NAVIGATOR - SELL BITS TO ISVS
In a sharp break with its existing business model Netscape is to breaking Navigator and sell individual components to software vendors. Sister publication ClieNT Server News reports that the project is part of the Netscape 4.0 'Gallileo' project. Netscape 4.0 will initially appear in monolithic form, but a 'modularised' version will appear hard on its heels.
Navigator product manager Dan Klaussen told the paper that native components would be available for each of the 16 platforms on which Navigator runs - a pretty mammoth redevelopment effort. He said the modules will be offered in ready-to-use form that drops into various development tools on the range of platforms. Moreover, the company is planning to make the modules native on each platform. So on the Macintosh, for example, Netscape has already committed itself to building an OpenDoc version. On Windows it will probably end up doing OLE-wrapped modules.
The major pieces likely to emerge as components include the browser itself, mail, news and threaded discussions. There's no pricing or accurate timing infoprmation available yet. Netscape says that the monolithic 4.0 is on track to be delivered before year-end with the components following "soon after". The modularisation effort could also help ameloriate Netscape's perceived 'bloatware' problems.
NETSCAPE BACKS IIOP://
Chris Stone may get his dearest wish yet - that his IIOP protocol becomes the basis of the Internet. The Object Management Group boss last week saw Netscape co-founder, Mark Andreessen, stand up before an audience of 1,500-2,000 vendors and users and back IIOP as the replacement for the Web's HTTP during his Object World keynote in Silicon Valley. Stone, who has been hinting for several months that an HTTP upset was what he was after, said later "it made my year" and justified the last seven he has put into OMG.
Earlier this month, Netscape of course threw its considerable weight behind the OMG's Internet InterORB Protocol, effectively giving it a Corba-dyed object strategy. Both Galileo, its next-generation browser, and Orion, its next-generation servers, are now supposed to be IIOP-based.Netscape's move is widely believed to have spooked Microsoft into suddenly and radically volunteering to put its object technologies, ActiveX, COM and DCOM, into some kind of standards body.
Andreessen last week equated the future of the Web with IIOP - since HTTP is supposedly not strong enough to carry the weight it is being asked to bear - increasing further the pressure on Microsoft to come to terms with Corba, the OMG object technology for which it has little use. Andreessen predicted that a year from now, because of Netscape, there would be 20 million IIOP-based browsers running on the desktop as well as a million IIOP servers. It is use that will popularize IIOP, according to the Gartner Group's Internet watcher David Smith, who says any next-generation Web protocol is more likely to be defined by Netscape or Microsoft than a consortium. Smith doubts IIOP will replace HTTP, though he thinks it might augment it. He thinks we'll eventually see URLs that are IIOP but most of them, he said, will be hidden from the user.
Meanwhile, some quarters now claim that Microsoft must either pour a fortune into DCOM or capitulate to Corba. The ideal - from the OMG's point of view - would be for Microsoft to immediately embark on an IIOP implementation for COM. Redmond could of course accept a half-way position that leaves OLE-COM and ActiveX controls the arbiter of the desktop and IIOP as the way to distribute apps on the Web but even that would seem to be very hard for Microsoft to countenance strategically.
Netscape's unqualified support for IIOP could also mean that the OMG might eclipse the World Wide Web Consortium (W3C), HTTP's progenitor and the standards body Microsoft may be eyeing as a place to house Activex. It may also force JavaSoft, which despite Sun's involvement in creating IIOP, has pretty much ignored it to Stone's chagrin, to finally make it central. Andreessen counseled users to demand their vendors start using IIOP and implement it themselves. The OMG acknowledges that IIOP is little known, especially among the critical ISV community, and that it has to embark on a serious educational campaign. Stone himself was gratified to observe that after the keynote he couldn't even see the OMG booth for all the bodies that flooded it - even if it was a little booth.
IBM PREPARES NC LAUNCH - WILL BRIEF ANALYSTS THIS WEEK
Word on the grapevine is that IBM Corp has called an analysts' briefing on its Network Computer plans on Friday, as we went to press. That usually means the announcement will be made the following Tuesday, which would be August 27. It gets people to sign non-disclosure agreements and that way, IBM can be certain all the details will be "leaked" to the Wall Street Journal ahead of the announcement.
The "thin client" Network Computers are still thought to be on course for delivery in November or December. They will cost between $650 and $750 without a monitor, and a shade less than $1,000 with one. As reported earlier, there will be a family of products, consumer, commercial and possibly a Personal Digital Assistant too. The AS/400 team in Rochester, Minnesota is co-ordinating the development of the commercial product, but is not officially leading the effort. It was simply that it was the first division to get a thin client ready, and is believed to have been chosen over two prototypes built by the Personal Computer Co, which means its work will likely form the basis of all IBM's Network Computer offerings. It was demonstrated to a user group last month. The AS/400 team, for want of a better name, is working with the mainframe, RS/6000 and personal computer server people to ensure each server is compatible with the thin client. The processor used in the thin clients will be a PowerPC, but officially IBM has not decided whether the 403, 603 or even the 604 will make it. As for the deal for Network Computing Devices Inc to manufacture Network Computers for IBM, Bruce Anthony, senior technical member of the AS/400 division, said the Mountain View company would not be the sole hardware supplier, and that other partners were going to be brought in. On the software front, IBM is predictably enough heading towards Netscape Communications Corp's Navigator product. The thin client will also include a Java virtual machine, and 5250 and 3270 terminal emulation.
NETSCAPE V MICROSOFT - MUCH HEAT, LITTLE LIGHT
Whether you believe Microsoft or whether you believe Netscape in the current anti-trust slanging match is largely a matter of personal preference or prejudice. Netscape's opening salvo from outside attorney Gary Reback initially looked strong; making specific allegations and naming companies that he said had been subject to Microsoft's restrictive practices. Reback says that the substance of his letter comes from companies calling him in response to the NT Workstation TCP/IP connection tussles that flared-up a few weeks back. $3 per copy discounts on Windows '95 if Netscape was made "less accessible", secret server APIs and predatory pricing, claimed to violate the anti-trust laws were all stirred into the mix.
Microsoft's response, published late last week (at www.microsoft.com/ie/
press/nscresp.htm) looked equally strong, and Reback's case was further damaged when the two companies he had named (Hitachi and AT&T) denied that they had been victims. Reback says they have been coerced and wants the Department of Justice to issue Civil Investigation demands against ISPs, OEMs and large corporate users to get to the bottom of it all. Meanwhile PC Week Online says it has tracked down seven unnamed OEMs it said were pressured into taking Explorer.
CONCEPTS, NOT KEYWORDS SAYS KNOWLEDGE DISCOVERY
Anyone who has ever surfed the Internet will invariably have wasted time with fruitless searches at some time or other. The likes of Yahoo, Digital Equipment Corp's Alta Vista or any one of their many search engine rivals source articles on a keyword basis that often retrieve too much or irrelevant information. According to Brett Moore, strategic director of Hong Kong-based Knowledge Discovery Ltd, the problem does not lie with the search engines, but with the users themselves. If the word or phrase keyed in is either too specific or random, the search is unlikely to unearth relevant information.
KDL's interactive division, KDL Interactive Ltd, reckons it has the answer to the quandary. The company launched its maiden software application, More Like This, at the end of last month. And Moore said he was confident the technology, which has taken 15 years to develop, would generate a revenue somewhere between $17m and $35m within the next 12 to 18 months. Scott Deerwester, the division's technical director, said the software categorises the World Wide Web conceptually to provide an automated search process that runs alongside existing Internet browsers.
More Like This contains somewhere between 15,000 and 16,000 different concepts. It enables a conventional search to run, but has added conceptual and wide-angled options to transform simple key-word queries into broader concept and contextual retrieval of documents outside the formal query, but related to the topic.
Key in 'Pope' and run a conceptual search and the software will add Papa, Vatican, Eritrea, Ansa and Iglou to the criteria. Ultimately you are still left with about 40,000 documents, but KDL said its aim was to bring the relevant information to the top of the pile. The software has been "crafted to be very gentle to novices." KDL said it has tried to simplify the search process: the browser is incorporated into the software, so only four 'buttons' are available to execute a search. It will run under Windows 95 and 3.1, needs about 7MB of free disk space to install and works best with 8MB or more of random access memory. It sits on top of the software and will currently run with any version of Netscape Communications Corp's Navigator and version 2 of Microsoft Corp's Internet Explorer, although version 3 will soon be compatible. Macintosh and Unix versions should be available with the release of version 2 in six to nine months' time. Deerwester said he has worked on the technology's memory-reduction process the past 15 years, and has now applied to patent his technique, which is able to compress 50GB in to 1.5MB. What is perhaps most impressive about More Like This is its ability to run with Windows 95 and 3.1, which effectively turns text-based word processing files into hypertext documents, and any word selected can be searched for via the World Wide Web. Moore said he has no way to tell how the technology will be used. "It's early days, but this time next year we hope to be established in the market." The software is available for download from:
www.morelikethis.com for a free 21-day trial. And if you like what you see, then a one-off payment of $35 will be charged.
YAHOO, ALTAVISTA AND INKTOMI LOOK TO REGIONAL EXPANSION
Regional marketing was the focus in search engine land last week as Yahoo!, Alta Vista and Inktomi Corp all announced plans to bring regionalized content to the World Wide Web. Inktomi, developer of Wired's HotBot, announced it will partner with Australia's OzEmail to develop a Web search engine, code-named Anzwers, for the Australian and New Zealand Internet markets. Inktomi says it wants to develop similar projects worldwide. Digital Equipment Corporation is also eyeing the Australian market. It intends to set up a "mirror" Alta Vista site Down Under, in partnership with Telstra/Yellow Pages, along with one in Scandinavia.
According to DEC, these mirror sites will contain all the information of Alta Vista's main search engine plus some local stuff. Because they will be set up on separate servers - closer to their expected audience - the mirror sites should be quicker for local users. DEC says the two sites will be up and running sometime in October. The long-term plan is to increase Alta Vista use from 17 million hits per day to 100 million within the next year, with 30 - 35 million from international users.
Not to be outdone, Yahoo announced Yahoo LA, which is being billed as a "comprehensive guide to Southern California". Rather than set up a separate server, Yahoo has elected to provide customized regional content on its main Website. As well as indexing 10,000 local Websites, Yahoo LA provides local news and entertainment information. Director of Yahoo Communities Ellen Siminoff says that the sites were set up to simplify things for Yahoo users who had been looking for more local information.
l America Online has announced that it will be using Personal Library Software, Inc.'s search and retrieval technology on a variety of its products. AOL plans to distribute PLS's "next generation" navigation system to access the Web.
Cadis International Inc. announced version 2.0 of its Krakatoa content management and search technology. Krakatoa uses an object class system to let you author without programming and change data in your database on the fly. Included in the new rev will be improved query functions and a buffed-up user interface. 2.0 will be available sometime in Q3.
US POSTAL SERVICE PONDERS SECURED, REGISTERED EMAIL
The Postal Service admits it has a long way to go before we will be emailing each other registered letters over the Internet, but it hopes to capitalize on its position as the nation's trusted carrier in bringing a broader family of products known as "Postal Electronic Commerce Services" online. Ken Ceglowski, Manager of Electronic Commerce Services, says that historical and legal precedents show that Electronic Postmarking might have an easier time being recognized in the courts than other initiatives.
There is still much to be done before this scheme would work. All users would have to register for both private and public authentication keys, presumably at their local post office. The US Postal Service would then maintain a registry for public/private key authentication. Billing would be comparable to current first class mail rates and could be billed either through ISPs or postal accounts. In the current prototype, mail is billed on a sliding scale, based on its payload size. Ceglowski says the Post Office is looking at existing technologies to provide transport security. He says the email reader would probably be provided free of charge.
HYBRID WEB-CD FOR DEVELOPERS
For those who are sick of waiting for a faster Internet, hybrid CD-ROMs may be the best way of boosting performance without installing an ISDN line. This week Colorado's MarketScape will announce its WebCD 1.0 development kit for creating hybrid Internet/CD-ROMs.
It allows Web designers to integrate Web and CD content through a browser interface, making it seem as though one is surfing the Web at high speed. WebCD is the first product that lets you simply point and click at a Website's URL to create a hybrid CD-ROM. MarketScape expects to cash in first on companies looking for a cheap and easy way of distributing high bandwidth material to their sales force via the Web, but they also expect it to be used for direct mail, catalogs and even for companies that don't feel comfortable posting Website information for just anyone - a kind of 50 cent firewall. The WebCD developer package for Windows 95 costs $975 per copy plus variable royalty fee for each CD. An NT version will be available by year end.
EUROPE OFFLINE:WHO'S NEXT?
There are storms ahead for Europe's online co.s reports Marsha Johnston
On paper, Europe On-Line SA was a great idea. First launched early last spring at a time when great editorial content was considered key to building an on-line services empire, Europe Online was a newborn positively draped in ermine. Flaunting internationally known publications such as Elle, Car & Driver and the Financial Times from its backers, three of Europe's largest media conglomerates - France's Matra Hachette, Germany's Burda and the UK's Pearson Plc - Europe Online was poised to challenge CompuServe Inc for supremacy in Europe's still-young on-line services market.
But when a Luxembourg court granted Europe Online protection from creditors on July 9, it was clear that content alone is no longer a king-maker, and that the traditional on-line services model that made CompuServe and America Online Inc world leaders is rapidly breaking down. For Europe's several hundred small and medium-sized Internet service providers, the CompuServe-America Online business model that includes managing a telecommunications network and computer centre, as well as producing and packaging editorial content, is particularly onerous. Little wonder, in a region where the Internet services market is still nascent and where telecoms infrastructure can be prohibitively expensive.
To make matters worse, the last year has seen every telephone company in Europe make an aggressive push into Internet service provision, for both the business and consumer segments. Deutsche Telekom AG's T-Online, for instance, added some 35,000 new subscribers in November 1995, to bring its total to 933,000, well in excess of leader CompuServe's 700,000 in Europe. Telekom said it was the biggest monthly increase since the service was launched in 1983 as a proprietary viewdata service similar to France's Minitel.
The alternative telecommunications operators springing up around Europe, such as Siris, the joint venture between France's Generale des Eaux SA and Unisource NV, have also joined the fray, making Internet access a low-margin commodity. Just a few weeks before Europe Online's near-bankruptcy, Telecom Italia got the green light from Italy's Antitrust Authority to gobble up the country's leading provider of Internet to consumers, Video On Line srl of Sardinia. Founder and owner Nicola Grauso's ambition to make Internet service in Italy as affordable as "a loaf of bread" by fire-selling it, foundered on the high costs of its worldwide network of high-speed leased lines. for its Internet business.
Europe Online's chief executive Jurgen Becker says "the food chain" of the Internet business has evolved into four segments: access, which comprises operation of the network and its so-called "points of presence" that provide local-call rate access; hosting, which is the computer centre that handles maintenance and billing for Web sites; content, which is the production and packaging of editorial services; and marketing of the service. "Access will be a telecommunications business, because the major [European] telcos are ramping up fast with their IP nets, most of which didn't exist 24 months ago. It is clear that an on-line service like Europe Online cannot win at the access-hosting end of the value chain because the telcos will just throw lots of money at it, so we will not fight them, but will partner with them," says Becker, adding that several of the six potential new shareholders he is talking to are telecommunications operators.
The squeeze is particularly brutal in the consumer end of the Internet service market which Both Europe Online and Video On Line exclusively targeted. "The amount of money you can make on the consumer side of the Internet market in Europe is very small," says Sergio Giacoletto, head of AT&T International's newly created value-added services business unit. "It is coming on very quickly, but there is still another 12 to 18 months of consolidation of existing players."
Corporate services is undoubtedly the most promising specialisation. At one of France's leaders, Grolier Interactive's Club Internet, which is owned by Matra Hachette Multimedia, the Studio, which creates Web sites for companies like Renault, is the only profitable part of the business, says 28-year-old chief executive Fabrice Sergent. The consumer side "will take another three years to break even, when we have enough of a subscriber base," Sergent says. "It's a long-term investment." In the meantime, Grolier Interactive is moving the majority of its Internet traffic to Matra's own satellite, to save money on the cost of leasing lines from France Telecom.
THE END OF THE HOME-BUILT NETWORK?
In a recent study of the European Internet market, London-based Durlacher Multimedia Ltd predicts that, as more and more companies target corporate clients, that market "will see some downward pressure on margins as companies lose money in the early stages in order to gain market share." With the current cost of leased lines in Europe, any drop in margins on services that use them would be disastrous. Per Bilse of EUnet notes that an E1 circuit, either across the Atlantic or to a bordering European country, costs $40,000 per month, while one to a more distant European country can cost $60,000 or more. In contrast, a T3 circuit coast-to-coast in the US - much greater distance, and with more than 20-fold capacity - is $80,000 a month. Thus the cost per mile per Megabit is less than 0.5% as much as in Europe. "America Online and CompuServe are building proprietary networks at a time in the European market when the migration away from a large part of their business model has begun," says Emily Green, an on-line analyst at Forrester Research, Boston. "At what point is America Online going to realise that it really needs to sell its network and get out of being a network operator? CompuServe has already been able to amortise the cost of its enormous network investment in the US, but in Europe it is having to spend new dollars, which becomes very expensive." Green expects that the on-line services market "will ultimately be like the US cable TV market, where you have the cable operator who brings the wire to your house, and the companies providing and distributing the programming are not necessarily at all the same ones operating the network." AT&T's Giacoletto believes that France's Minitel model "is a good example of what will happen. You have the access provider, but this time we will have more than one, because of deregulation, and various service providers, where you will pay for serious business-to-business and consumer information and services."
BATTLING ON BUILDING THEIR OWN.
Judging by their strategies, neither America Online nor CompuServe puts much stock in such predictions about the way the market is evolving. "We are very optimistic about the prospects for the growth of on-line services in Europe, and we will continue to expand our European network two ways: as the customer base grows, we will add more modems and, as we grow out of the UK, we will expand our geographic coverage," declares Jack Davies, president of America Online International.
Although telecommunications costs in Europe are higher, he says, "as a percentage of revenues, they are about on a par with the US." He adds that America Online's marketing costs "are far more critical, in terms of getting to a break-even, than telecommunications costs." For its part, CompuServe is revamping its European network with new technology to let more customers dial in with a local call, as part of a $200m worldwide network investment announced early in the year.
For the on-line service providers like Lyon-based Infonie, however, who lack the critical mass of CompuServe and America Online, the future is clearly different. Infonie chief executive Bruno Bonnell is impatient to move to a new business model: "I'm convinced that access will be ultimately provided only by telcos, and I hope it happens very soon. We only put in a network because the technology was not there, but as soon as possible would like to get rid of network management - when somebody proposes the right technology. Our strategy is to do 100% management of content."
Indeed, only the on-line services like Grolier's Club Internet that are lucky enough to have everything in house may be spared transition or death. Says Sergent, "If we didn't have Matra and its technology, we would be faced with the same problems the others have."
@HOME FINDS PARTNERS, STILL SEARCHING FOR BUSINES MODELS
"Who are we? Why are we here?" are two questions the company hasn't come to terms with, writes Willam Fellows
Highly highly-fancied and leveraged Mountain View, California start-up @Home Corp has announced a raft of content providers that'll use its Internet-based network infrastructure to deliver services into homes, workplaces (@Work) and schools via high-speed cable modem connections.
@Home believes that cable modems supplied by its cable service partners - to date they are Tele-Communications Inc, Comcast Corp and Cox Communications - will eventually allow customers to attach multiple client devices to its network, including PCs, television set-tops, network computers and even gaming devices such as Sony PlayStations. However whilst the likes of the Wall Street Journal, C|Net, CUC International, Knight-Ridder, New York Times, Discovery Channel Online, The Weather Channel and USA Today last week declared themselves to amongst @Home's initial slew of some 60-odd media development program partners, it's not clear who is paying whom for the privilege.
It's indicative of a wider set of questions marks that hover above the company, like what exactly is it? And how it will make money?
MAKING MONEY IS HARD TO DO
It's "model mania" out there, admits Kleiner Perkins Caufield & Byers partner Will Hearst, also @Home's founding CEO and now vice chairman in New York yesterday to talk up the company's prospects to Kagen interactive services conference. "There's no one way of figuring out how to make money in this market."
@Home says the cable providers that actually sell the $35 to $45 per month service into homes and workplaces may pay royalties to it based upon customers' network and content usage or it may collect revenue directly from the cable companies, its Internet service provider and content partners, or a combination of all of them.
Although data transfer rates of 10Mbps into the home and 128Kb or greater back to the network over co-axial cable will allow content providers to change significantly the kinds of services they must currently deliver over low-bandwidth, login-oriented dial-up or dedicated telephone connections, even @Home says it doesn't know what theses services will eventually look like. For comparison, 10Mbits, or ten million bits per second is 50 times faster than ISDN; T1 connections operate at 1.5Mbps.
However for the near-term @Home has identified some positively mediocre objectives, including provision of stock ticker feeds, instantaneous viewing of movie clips, walk-through travel guides, up-to-date sports information, video chats with celebrities, unhindered access to popular sites during peak access periods and personalised content delivery. So aren't we just talking about high-speed Internet access here? No, "we're not just a big pipe," claims @Home VP business development Charles Moldow, "we're an intelligent network," pointing to research which he claims shows that touting @Home's service simply on the basis of improved Internet access speed would deliver only a small percentage of home or business Internet users into its arms. Well how about a high-speed America Online or Compuserve? After all customers will have to use @Home's customised version of the Netscape Navigator browser, an @Home email package, @Home TCP/IP stack and search and query tools.
"We're not a closed community," it says "and we are not a content provider." Whilst @Home claims to have had discussions with AOL and other "closed" communities, we don't know what those talks have been about. In essence @Home's asking customers to buy high-speed net access from its cable partners for $35 to $45 a month. then they'll have to pay for at least some of the services they may currently receive for free on the Internet. But if the model works, it might finally provide a means for content providers to make some real money from being on the net.
EASIER TO DESCRIBE WHAT IT ISN'T
However, because the services of the future and @Home's supposed bandwidth and network technology advantages are still intangible to all except the handful of trial sites across the US, perhaps it's easier to describe what the @Home network says it isn't. It's says it's not about delivering television to PCs, it's not in the television distribution business and video on demand is just one option it'll provide. @Home also doesn't claim to know what the end-user metaphor of the future will be, even though its first paying customers will go live in the fall with browser-oriented interfaces. "The long-term future of the browser is unclear," says Moldow, who believes services will move outside the browser and the browser itself become more componentised.
If there's little @Home can say about the types of content it'll deliver long-term, there's also little that it'll say about its technology partners until September 11th when it plans to reveal all at a press conference in Mountain View.
What we do know is that @Home's private ATM-based backbone will connect to the global Internet at multiple locations; in other words through all of its Internet service provider partners, of which there are said to be many. The backbone will connect information and content providers to regional data centers via a switched data system. The regional data centers will be connected to local hubs, or cable headends, which in turn transport data to end users. @Home has already chosen Silicon Graphics Inc's WebForce Challenge servers combined with Netscape Communications Corp's Proxy software - what SGI calls its WebForce Proxy servers - for the caching servers at the cable headends. Downstream data into the home is carried over a broadband channel, the low bandwidth return path carries commands and responses upstream through the same cable. Initially the only connection requirement will be a PC or Macintosh with an Ethernet connection plus the @Home browser, email software and TCP/IP stack. A high speed modem will be installed by the cable operator. @Home's also created an @Work division to cater for intranets and business users, though it's plans in that area are more shadowy. It's focusing on the high-profile home/consumer users for maximum exposure.
THE CASH IS IN THE CACHE
For content and application providers in its media development program, @Home's created a bunch of enabling technologies for delivering services over the @Home network. Its SmartCache crown jewels allows content providers to store information on local servers, giving users immediate access to data. It also allows content providers to update cached information, something currently not possible over conventional web/Internet configurations where users must reload pages frequently. The cache also sends back information to content providers about exactly which data has been accessed.
M-Cast is @Home's own flavour of Mbone multicasting. On-Net is a content replication facility designed to avert bottlenecks. Knowledge API and Usage Data is claimed to provide demographic information about a web user to site operators without revealing an individual user's identity, allowing site operators to customise content for their visitors.
An @Home Passport of unique identifiers will allow users to access multiple sites without having to enter a password every time. Direct Connect allows content providers to hook directly to users through the @Home network rather than going through the Internet. Members of the media development program will supposedly get access to tools, technologies and proprietary research, network resources, developer conferences and web sites, newsletters and reports.
They're also being offered membership of a technical consortium @Home's trying to establish, though the company wasn't able to say what the intended purpose of the consortium is or whether it yet has any members.
COMPUSERVE SHEDS JOBS AS $29.6M LOSS REPORTED
H & R Block Inc got shot of Columbus, Ohio-based CompuServe Corp just in time, but the shareholders that bought into the company at its flotation don't feel so chirpy about it. The company made a surprisingly large $29.6m fiscal first-quarter loss, blaming a decline in the number of subscribers to its on-line service and the cost of creating its new WOW! family-oriented service and making other improvements.
It warns that it will also make a loss this quarter, but hopes earnings will improve in the second half of the fiscal year. The company is taking stern action, cutting 150 jobs, or 4% of its work force, as part of a cost-cutting program intended to save $30m on an annualised basis. It will also sell the corporate software group of its Spry Inc unit, whose Web browser is a pitiful also-ran behind those of Netscape Communications Corp and Microsoft Corp. The number of people logging off exceeded the 900,000 new subscribers to the company's on-line services, producing a "modest decline" in subscriber numbers. As of July 31, CompuServe had 3.3m subscribers worldwide, which rises to 5.2m with those of the NiftyServe, a joint-venture Japanese on-line service. The company expects increased revenue from advertizing and fees for electronic commerce. The shares dropped 12.5 cents to $13.50 ahead of the news - a nasty tumble from the $30 at which it floated in April.
MOST MIS ANSWER 'DON'T KNOW' WHEN ASKED ABOUT BROWSERS
Netscape and Microsoft may not know it, but most Fortune 1000 companies do not necessarily expect either of the two browser titans to be dominating the market by the year 2000.
In a study released for Merrill Lynch last week by Collaborative Strategies on the growth of IP networks, most respondents chose neither Navigator nor Explorer as the browser that would be on their desktop by the year 2,000. According to Collaborative Strategies principal, David Coleman, "the most popular selection was 'other'".
Collaborative interviewed MIS staff in 100 Fortune 1000 companies. They found a third of the firms were uncomfortable with the rapid pace of software evolution and many intended to continue developing on legacy platforms. Lotus Notes, for example is predicted to grow at a rapid rate over the next half-decade: 279% over the next 2 years, 74% in the two after that. Coleman says, "these companies are focused on selling widgets, not software. They want to amortize their investment". www.collaborate.com
Those feeling restricted by .com or .net international domains should be able to bid to run other domain registries by October (OR issue 1). Assuming some business issues are tidied up, a new ad hoc committee should be formed by early September to produce the specifications for those wishing to run a domain name registry. Applications for the first tranche will be taken until the end of November, and by early January the commitee will have selected the (up to 50-odd) winners. The Internet Society will then sign contracts with them, with the aim of getting the new registries up by the end of January. The commitee will be appointed by the Internet Assigned Numbers Authority, the president of the Internet Society and the chair of the Internet Architecture Board.
However an initial report on C/Net last week, quoting IANA chief Jon Postel on the plan, caused annoyance on the mailing list designed to thrash out the changes. Many correspondents were surprised that Postel's draft proposals were being accepted without the list being notified.
CEO of the Internet Society, Don Heath, confirmed the October timescale was on the
NOVELL OPENS ITS DIRECTORY
SERVICES WITH GREEN RIVER
Novell Inc has announced the open beta availability of NetWare version 4.11 - the Green River release. Among the enhancements is the inclusion of the NetWare Web Server 2.5, designed to enable NetWare to be used as the system for intranet and Internet Web sites.
It incorporates the NetBasic scripting engine, as well as support for Java applets, JavaScript, the Remote Common Gateway Interface, the Local Common Gateway Interface, access controls and logging, as well as PERL script interpreters.
Alongside NetBasic, NetBasic for the Internet has also been added, enabling Web browser users to access and execute Basic scripts across the Internet. Novell has also brought access to its NetWare Directory Services into the Internet fold, by enabling directory information to be published on Web pages; in this way, says the company, end-users can browse the directory (through user names, email addresses, URLs, etc.) for access to information about network users.
Also new with the release is full support for TCP/IP with Dynamic Host Configuration Protocol, as well as C2-level security. Finally, the company has added new NetWare Licensing Services to enable organizations to track and monitor the use of NLS-enabled licensed applications. The software is available for a "nominal shipping and handling fee"; users can register to receive it from Novell's Web site at http://netware.novell.com/river/
MICROSOFT SIGNS CRYPTOGRAPHY DEAL WITH RSA PARENT
Microsoft Corp and Security Dynamics Technologies Inc signed a number of cross-licensing agreements on security technology giving Microsoft greater access to SD's RSA subsidiary.
The pacts would enable corporate users to increase security through the addition of SecurID token authentication to the Windows NT Server network operating system and Microsoft Internet Information Server. Developers' toolkits from RSA will be available which feature Microsoft's cryptographic programming interface, CryptoAPI, enabling the addition of secure features to software products in development. RSA will receive ongoing revenue from Microsoft based on the use of patented RSA technology.
Microsoft will license CryptoAPI to RSA, including rights to incorporate CryptoAPI into RSA's BSAFE and other security toolkit products, to put CryptoAPI up on new systems, and to build on Microsoft's base set of cryptography services.
DOT Gossip
Sprint Corp reckons it's already the world's largest carrier of Internet traffic, but it has been tardy in following MCI Communications Corp and AT&T Corp into Internet access provision for consumers: yesterday it put that right with the launch of Sprint Internet Passport and chose Netscape Communications Corp's World Wide Web browser; Sprint will offer the service free to 200,000 of its existing telephone customers until it is introduced widely in the Autumn and will then charge either a flat rate of $19.95 a month for unlimited access, or $1.50 an hour with no minimum or maximum usage requirement. Microsoft Corp on the case though, and says it hopes an agreement between the two firms can be announced soon.
Some people have been using intranets for some time, and Sharp Corp says it will spend about $30m to expand access to its intranet to offices in Malaysia and other Asian countries: the project will raise the number of its overseas offices with access to the in-house computer network to 51 from 18 by the end of March; some 133 domestic offices are hooked up to the intranet, used for on-line exchange of graphics and text, greatly reducing printing and mailing costs; it also includes access to the Internet, but the technology used was not revealed.
McAfee Associates Inc is to acquire privately-held security software specialist FSA Inc for 356,000 new shares valued at $22.8m: FSA's encryption technology protects information privacy by providing transparent and secure communications across all TCP/IP networks, McAfee says, introducing Secure-1, a network security suite to integrate anti-virus and encryption as a first fruit of the acquisition.
Chrysler Corp 's internal systems department has halted a proposed shift from Unix to Microsoft Corp's Windows NT in favour of using Netscape's browser and server technology, enabling its 5,000 plus dealers to perform remote diagnostics on Chrysler cars; the agreement, which is said to involve a site licence for Navigator and $10m for server software, obviously doesn't extend to its public Web site www.chryslercorp.com , which is liberally marked "best if viewed with Internet Explorer," and it doesn't work very well at all when viewed through Navigator.
The browser wars have now divided those two giants of the US business press the Wall Street Journal and the New York Times, with the Journal tied into a deal with Microsoft Corp and the Times with Netscape Communications Corp for free subscriptions to their Web versions: since the Journal is currently available for free anyway, one might think that Netscape has got the better deal, except that the Times site is by far the weaker of the two, and last time we tried it, it was so slow as to be unusable.
And at least the Wall Street Journal had the grace to declare its interest and last Friday posted a note from the Editor insisting the bundling deal with Microsoft Corp would not influence its coverage.
Microsoft has acknowledged quite a few bugs, or 'issues' as it likes to call them, with Internet Explorer 3.0. Apart from the security issue reported on page 1, the problem with password-protected pages seems to be causing most angst, together with the 55MB disk space requirement. As we went to press Microsoft was promising an updater by the end of the week - so it should be up there by now. The full list of known issues/bugs can be found at: www.microsoft.com/iesupport/content/issues/
Demonstrating just how much it suits companies to deliver their software over the Internet, Cupertino, California based PointCast Network is to ship its eponymous retail package to more than 5,000 computer and electronics stores US-wide by early October - but where downloading it is free, on floppy it costs $20, for which you can buy about one and a half music compact disks; the retail version will include Internet connection software and complimentary 30-day phone support in an effort to justify the $20 charge.
Microsoft Corp has a memorandum of understanding to pay Fremont, California-based StarSight Telecast Inc, developer of interactive electronic television program guides, $20m for a non-exclusive global licence to its intellectual property.
Magdalena Yesil, co-founder and vice-president of marketing and technology industries at Reston, Virginia electronic cash pioneer CyberCash Inc quit and is off to Silicon Valley to head a start-up.
Microsoft Corp says more than 1m copies of Internet Explorer 3.0 were downloaded in its first week of availability.
Ncompass Labs Inc; is about to change direction. The company which has so far made its living with an ActiveX-for-Netscape plugin, will announce its next set of products in a couple of weeks and they will be intranet productivity apps, say sources.
Internet access provider NetCom On-Line Communications Services Inc, Los Angeles, California, warns it expects to incur substantial net losses for the foreseeable future due to intense competition in the on-line industry, it said: in a quarterly filing with the Securities & Exchange Commission, Netcom said it plans to continue its expansion overseas in order to raise its subscriber base; it warned it could not assure continued revenue or subscriber growth or that it will achieve and then sustain profitability or positive cash flow.
L M Ericsson Telefon AB said its Public Telecomunications division will be considerably more profitable a year from now: the unit has suffered from the effects of a wide-ranging rationalisation programme and investments in broadband
communications products, it said; order intake for the half year was up 20%, the company said, but the strong order flow may ebb slightly later in the year, Ericsson added.
Microsoft Corp has sucessfully wooed the two biggest UK Internet access providers, the UUNet Pipex arm of UUNet Technologies Inc, and Demon Internet Ltd, to bundle Explorer with their services where previously they bundled Netscape Communications Corp's Navigator: British Telecommunications Plc said earlier that it was also bundling Explorer, and 20 others in the UK and Ireland are also defecting to Microsoft, the lure being a click-on list within Windows 95 of Internet access providers that bundle Explorer 3.0.
Microsoft Corp's Police Force is falling down on the job: according to the current Cringely columnist in Infoworld, if you look closely at the screens on MSNBC when the camera pans across the newsroom you'll see that the browser the staff at the news channel use is - you guessed it - Netscape .
(c) 1996 May not be copied
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WEEKLY DISPATCHES FROM THE INTERNET FRONT
August 26 - 30 1996 Issue No 13
IBM THROWS R&D ONTO THE WEB, JAVA FOR WIN 3.1 ARRIVES
The mysterious alphaWorks project we reported on (OR issue 10) turns out to be an audacious attempt by IBM to accelerate the pace at which Internet technology, under development in the labs, is either turned into products, licensed or junked. IBMers from labs and individual skunk-works projects will submit their pet gizmos to a new Web site (www.alphaworks.ibm.com) for the world to download and evaluate. IBM is also hoping that it will improve sluggish communication within the company, bringing hot technologies to the notice of product managers within IBM. "We realised we had a dire need to figure out a better way to get these technologies out into the world," says alphaWorks manager, Andrew Morbitzer, "we want to get them out very early in the life cycle so we can quickly get the money behind the technologies". As part of the scheme, IBM has streamlined the intellectual property clearances that IBM researchers need to undertake before releasing technology. A Notes-based internal system has reduced the time for clearance (including name clearance, patent protection etc) to around three weeks in most cases, says Morbitzer - maybe six if there are complications.
The site debuts with six technologies, including the long-awaited Java system for Windows 3.1 (now named 'applet development kit for Windows 3.1', to avoid Java trademark issues). The others include: Bamba, a realtime audio and video streaming, encoding and player package which IBM reckons outperforms both RealAudio and VDONet. Another, Panoramix, sounds as if it should give Apple's Quicktime VR a run for its money. It is claimed to let Internet users construct panoramic views of landscape or rooms without the need for a special camera.
EXPLORER SECURITY LOOPHOLE BLAMED ON MACROS
By the time you read this, Microsoft should have a new version of Internet Explorer 3.0 available that fixes a potentially serious security loophole. Last Wednesday, Princeton University's Ed Felton and Birk Balfanz used the comp.risks newsgroup to announce a flaw that lets an attacker run any DOS command on a visiting browser's machine. An attacker could read, delete or modify a victim's files.
Microsoft was promising a fix by the end of the week as we went to press and the Princeton duo aren't giving away details until Microsoft has solved the problem. However, the fault centers on Explorer's ability to automatically display Word or Excel files that may contain macros. Usually Explorer displays a warning before downloading such potentially dangerous files - asking for permission. But the researchers have discovered a way by which attackers can circumvent this, and say they have verified the hole by putting together a Web page that automatically deletes a file from a visitor's machine. Internet Explorer has the ability to view Word and Excel documents, either by launching the applications themselves, or by invoking a stripped-down viewer. However the viewer cannot run macros.
Ed Felten told Online Reporter that the bug may also affect ActiveX components, but that this has yet to be verified.
Those feeling restricted by .com or .net international domains should be able to bid to run other domain registries by October (OR issue 1). Assuming some business issues are tidied up, a new ad hoc committee should be formed by early September to produce the specifications for those wishing to run a domain name registry. Applications for the first tranche will be taken until the end of November, and by early January the commitee will have selected the (up to 50-odd) winners. The Internet Society will then sign contracts with them, with the aim of getting the new registries up by the end of January. The commitee will be appointed by the Internet Assigned Numbers Authority, the president of the Internet Society and the chair of the Internet Architecture Board.
However an initial report on C/Net last week, quoting IANA chief Jon Postel on the plan, caused annoyance on the mailing list designed to thrash out the changes. Many correspondents were surprised that Postel's draft proposals were being accepted without the list being notified.
CEO of the Internet Society, Don Heath, confirmed the October timescale was on the cards, but said that this assumed that a number of business issues, such as charging and handling conflicts between organizations who apply for the same domain names, could be fixed. "There are several things that need to be sorted out, including rate structures and fees," he said. Postel is proposing that domain registries pay a fixed $2,000 per year fee plus 2% of their domain-derived revenue to the Internet Society, to help fund infrastructure.
The move is a curious departure from the regular IETF mechanism which sees draft proposals elevated to the Internet Engineering Steering Group once they have survived peer-review-by-fire on the mailing-lists. Heath said that Postel's proposals were accepted in principle by the Internet Society's board of trustees as long ago as June, with the proviso that the business issues be firmed up. The period of public debate has now essentially ended and the decisions on the final issues "will be done between Postel and people within the Internet Society", said Heath.
"The IETF/IESG process is really good for
I'Soc steams ahead with new domain scheme - apply October
If the eventual standards home of ActiveX remains a mystery, so does the timing of the meeting which is supposed to decide its fate. As previously reported, the meeting has slipped from its original mid-August time frame to... well, no-one knows. Not even, it seems, the Burton Group which is meant to be organizing the thing. The latest gossip has it that Tim Berners-Lee, director of the W3C, has decided that the Consortium is an inappropriate vehicle. That might account for the delay since the W3C is one of Microsoft's favoured options.
However a Consortium spokesperson vehemently denied that any decision had been taken, saying that anything is still possible.
AIM A STEP CLOSER TO WEB-TVS WITH COMPUSERVE DEAL
American Interactive Media Inc, the company that wants to put your television set onto the Internet for "much less than $500", has progressed with its plans to the point of signing CompuServe Corp to a multi-year agreement to become its Internet access provider.
Under the deal, buyers of American Interactive's set-top Internet access device, the price of which has now pared down to less than $400 (probably more than $400 with tax), will be offered unlimited access to the Internet and World Wide Web through CompuServe's Sprynet Internet access service. The access device includes hand-held remote control, and comes preloaded with a browser, electronic mail, a dialler and a printer driver. Users will get access to the Internet via a customised Internet "channel" that is being developed by American Interactive and CompuServe. There is no date for the launch of the new product.
Medford, New Jersey-based AIM licensed the television set-top box technology from Milton Keynes, UK company MSU Ltd
SCO SHOWS ITS NC OS - HDS TATUNG & ACER ARE INTERESTED
Santa Cruz Operation Inc's new NC/OS Network Computer operating system (OR issue 12) was being shown at the SCO Forum last week. As reported, It's a small-footprint version of Unix - and it's one that has been seen before. Previously it was sold as an environment for point-of-sale systems, but now it has Netscape Communications Corp's Navigator, a TCP/IP stack and some networking glue on top.
Crucially, it runs on standard Intel Corp processors, from an 80386 up. The operating system itself takes up 1.45MB, and with Navigator added, Santa Cruz reckons the whole thing requires no more than 8MB.
Scott McGregor, Santa Cruz's senior vice-president for product marketing, said the Navigator cache could either be held on a very small hard disk or in Flash memory. The operating system and browser can be held in ROM, he said. Santa Cruz apparently took just 45 days from concept to having the thing ready, hardly surprising as the kernel was already written and being used.
The company is currently hawking it round to any of its existing OEM customers that might be interested in building Network Computers. They apparently "went goo-goo" when they were shown it, according to vice-president for the Internet, Jeff Ait. Two are said to be ready to go with some sort of device, while around eight others are currently developing products, according to Ait. Other companies are being shown the operating system, including some in Taiwan and elsewhere in the Far East, including Tatung Co Ltd and Acer Inc, as well as some large US personal computer manufacturers, none of which Santa Cruz would reveal. One of them was said to be "very, very nervous" about word getting out that it was looking to build a Network Computer.
HDS Network Systems Inc, which claimed to be the first company anywhere with a Network Computer when it launched one back in June, is just about to start talking to Santa Cruz about possibly using the NC/OS, despite having its own Posix-compatible microkernel, which only takes up 300Kb, including Spyglass Inc's Web browser, as part of its Universal Client environment.
The NC/OS will appear in a variety of embedded systems in the near future according to McGregor - apart from point of sale systems - including handheld devices. McGregor said SunSoft Inc's Java OS can't compete at the moment, as it doesn't have any networking or systems management capabilities yet.
Things that were stripped out of Unix to make it fit in such a small space include symmetric multiprocessing support and large file management support. Santa Cruz hosted a Network Computer pavilion at the Forum last week, where numerous vendors will be showing their wares, including Sun Microsystems Inc, Apple Computer Inc, HDS, SunRiver Corp, Diba Inc, NetChannel Inc, Unisys Corp, Idea Corp, Akai Electric Co, ViewCall America Inc, Wyse Technology Inc and Maxspeed Corp.
IDT will attempt to breathe life into Genie, following buy-out
Hackensack, New Jersey-based IDT Corp said last week that it has bought the Genie Online Service from Yovelle Renaissance Corp for an undisclosed sum - all of which sounds a bit odd given that Yovelle was a vehicle formed for the purpose of buying the forgotten on-line bulletin board service from General Electric Co Inc's GE Information Services, and that IDT was said at the time to be "associated with" Yovelle.
But it appears that since the original announcement, IDT, Renaissance and General Electric have all been squabbling. Genie provides multi-player gaming, interactive chat and bulletin board services for 20,000 customers in the US, and IDT, Internet access and telephone service provider, gets rights to the Genie names and over 100Gb of content. The content will be incorporated into IDT's recently-introduced Genie Interactive service, a new on-line service optimistically designed to compete with America Online Inc and CompuServe Corp. Genie Interactive offers unlimited access to its content for a flat fee. IDT gets long-term access to the General Electric Information Services technical infrastructure to support the on-line service. Genie On-line service currently has 20 employees in its Rockville, Maryland facility and has over 60 system operators moderating discussion groups and adding to its special interest bulletin board services. The new Genie Interactive service will be run from IDT's Hackensack headquarters. IDT says that the deal, terms of which were not disclosed, amicably settles all the nastinesses between the parties.
SUN TAKES IBM MQSERIES FOR JAVA - MICROSOFT HAS FALCON
It looks like the next set of battle lines for those targeting the distributed-application market is going to be message passing. Sun Microsystems has licensed IBM's MQSeries messaging technology, used to handle messages between disparate systems over unreliable lines. At the same time Microsoft Corp's Falcon message-oriented middleware technology for Windows NT has gone into beta. Redmond is positioning Falcon as its own answer to MQSeries.
Falcon is designed to enable developers to build large-scale distributed systems with reliable communications between applications that can keep functioning even when the network goes down, using a common queueing system. Microsoft is working with Level 8 Systems Inc to make sure Falcon can integrate with "legacy" systems, a category in which it places MQSeries, as well as CICS.and Sun uses
TALIGENT WORK TO INTERNATIONALIZE JAVA
Sun Microsystems has been picking through what is left of Taligent Inc in the IBM Corp vaults, and has discovered something of value - the Taligent class libraries, which implement key components of the Unicode international character set.
It wants to incorporate them in Java so that developers can create global applications and applets in it. The class libraries mean that Java, written by programers working in American English, would automatically recognise the language differences of individual countries.
It has long been known that IBM was tinkering with Taligent, Java-ising parts of it. But IBM is not saying whether any similar deals, for other elements.
To return the compliment, IBM is licensing Sun's Joe, designed to enable businesses to deliver corporate Java applications to any system that is supported by the Java language. Joe links Sun's Neo object request broker to Java.
NETSCAPE TO BREAK UP NAVIGATOR - SELL BITS TO ISVS
In a sharp break with its existing business model Netscape is to breaking Navigator and sell individual components to software vendors. Sister publication ClieNT Server News reports that the project is part of the Netscape 4.0 'Gallileo' project. Netscape 4.0 will initially appear in monolithic form, but a 'modularised' version will appear hard on its heels.
Navigator product manager Dan Klaussen told the paper that native components would be available for each of the 16 platforms on which Navigator runs - a pretty mammoth redevelopment effort. He said the modules will be offered in ready-to-use form that drops into various development tools on the range of platforms. Moreover, the company is planning to make the modules native on each platform. So on the Macintosh, for example, Netscape has already committed itself to building an OpenDoc version. On Windows it will probably end up doing OLE-wrapped modules.
The major pieces likely to emerge as components include the browser itself, mail, news and threaded discussions. There's no pricing or accurate timing infoprmation available yet. Netscape says that the monolithic 4.0 is on track to be delivered before year-end with the components following "soon after". The modularisation effort could also help ameloriate Netscape's perceived 'bloatware' problems.
NETSCAPE BACKS IIOP://
Chris Stone may get his dearest wish yet - that his IIOP protocol becomes the basis of the Internet. The Object Management Group boss last week saw Netscape co-founder, Mark Andreessen, stand up before an audience of 1,500-2,000 vendors and users and back IIOP as the replacement for the Web's HTTP during his Object World keynote in Silicon Valley. Stone, who has been hinting for several months that an HTTP upset was what he was after, said later "it made my year" and justified the last seven he has put into OMG.
Earlier this month, Netscape of course threw its considerable weight behind the OMG's Internet InterORB Protocol, effectively giving it a Corba-dyed object strategy. Both Galileo, its next-generation browser, and Orion, its next-generation servers, are now supposed to be IIOP-based.Netscape's move is widely believed to have spooked Microsoft into suddenly and radically volunteering to put its object technologies, ActiveX, COM and DCOM, into some kind of standards body.
Andreessen last week equated the future of the Web with IIOP - since HTTP is supposedly not strong enough to carry the weight it is being asked to bear - increasing further the pressure on Microsoft to come to terms with Corba, the OMG object technology for which it has little use. Andreessen predicted that a year from now, because of Netscape, there would be 20 million IIOP-based browsers running on the desktop as well as a million IIOP servers. It is use that will popularize IIOP, according to the Gartner Group's Internet watcher David Smith, who says any next-generation Web protocol is more likely to be defined by Netscape or Microsoft than a consortium. Smith doubts IIOP will replace HTTP, though he thinks it might augment it. He thinks we'll eventually see URLs that are IIOP but most of them, he said, will be hidden from the user.
Meanwhile, some quarters now claim that Microsoft must either pour a fortune into DCOM or capitulate to Corba. The ideal - from the OMG's point of view - would be for Microsoft to immediately embark on an IIOP implementation for COM. Redmond could of course accept a half-way position that leaves OLE-COM and ActiveX controls the arbiter of the desktop and IIOP as the way to distribute apps on the Web but even that would seem to be very hard for Microsoft to countenance strategically.
Netscape's unqualified support for IIOP could also mean that the OMG might eclipse the World Wide Web Consortium (W3C), HTTP's progenitor and the standards body Microsoft may be eyeing as a place to house Activex. It may also force JavaSoft, which despite Sun's involvement in creating IIOP, has pretty much ignored it to Stone's chagrin, to finally make it central. Andreessen counseled users to demand their vendors start using IIOP and implement it themselves. The OMG acknowledges that IIOP is little known, especially among the critical ISV community, and that it has to embark on a serious educational campaign. Stone himself was gratified to observe that after the keynote he couldn't even see the OMG booth for all the bodies that flooded it - even if it was a little booth.
IBM PREPARES NC LAUNCH - WILL BRIEF ANALYSTS THIS WEEK
Word on the grapevine is that IBM Corp has called an analysts' briefing on its Network Computer plans on Friday, as we went to press. That usually means the announcement will be made the following Tuesday, which would be August 27. It gets people to sign non-disclosure agreements and that way, IBM can be certain all the details will be "leaked" to the Wall Street Journal ahead of the announcement.
The "thin client" Network Computers are still thought to be on course for delivery in November or December. They will cost between $650 and $750 without a monitor, and a shade less than $1,000 with one. As reported earlier, there will be a family of products, consumer, commercial and possibly a Personal Digital Assistant too. The AS/400 team in Rochester, Minnesota is co-ordinating the development of the commercial product, but is not officially leading the effort. It was simply that it was the first division to get a thin client ready, and is believed to have been chosen over two prototypes built by the Personal Computer Co, which means its work will likely form the basis of all IBM's Network Computer offerings. It was demonstrated to a user group last month. The AS/400 team, for want of a better name, is working with the mainframe, RS/6000 and personal computer server people to ensure each server is compatible with the thin client. The processor used in the thin clients will be a PowerPC, but officially IBM has not decided whether the 403, 603 or even the 604 will make it. As for the deal for Network Computing Devices Inc to manufacture Network Computers for IBM, Bruce Anthony, senior technical member of the AS/400 division, said the Mountain View company would not be the sole hardware supplier, and that other partners were going to be brought in. On the software front, IBM is predictably enough heading towards Netscape Communications Corp's Navigator product. The thin client will also include a Java virtual machine, and 5250 and 3270 terminal emulation.
NETSCAPE V MICROSOFT - MUCH HEAT, LITTLE LIGHT
Whether you believe Microsoft or whether you believe Netscape in the current anti-trust slanging match is largely a matter of personal preference or prejudice. Netscape's opening salvo from outside attorney Gary Reback initially looked strong; making specific allegations and naming companies that he said had been subject to Microsoft's restrictive practices. Reback says that the substance of his letter comes from companies calling him in response to the NT Workstation TCP/IP connection tussles that flared-up a few weeks back. $3 per copy discounts on Windows '95 if Netscape was made "less accessible", secret server APIs and predatory pricing, claimed to violate the anti-trust laws were all stirred into the mix.
Microsoft's response, published late last week (at www.microsoft.com/ie/
press/nscresp.htm) looked equally strong, and Reback's case was further damaged when the two companies he had named (Hitachi and AT&T) denied that they had been victims. Reback says they have been coerced and wants the Department of Justice to issue Civil Investigation demands against ISPs, OEMs and large corporate users to get to the bottom of it all. Meanwhile PC Week Online says it has tracked down seven unnamed OEMs it said were pressured into taking Explorer.
CONCEPTS, NOT KEYWORDS SAYS KNOWLEDGE DISCOVERY
Anyone who has ever surfed the Internet will invariably have wasted time with fruitless searches at some time or other. The likes of Yahoo, Digital Equipment Corp's Alta Vista or any one of their many search engine rivals source articles on a keyword basis that often retrieve too much or irrelevant information. According to Brett Moore, strategic director of Hong Kong-based Knowledge Discovery Ltd, the problem does not lie with the search engines, but with the users themselves. If the word or phrase keyed in is either too specific or random, the search is unlikely to unearth relevant information.
KDL's interactive division, KDL Interactive Ltd, reckons it has the answer to the quandary. The company launched its maiden software application, More Like This, at the end of last month. And Moore said he was confident the technology, which has taken 15 years to develop, would generate a revenue somewhere between $17m and $35m within the next 12 to 18 months. Scott Deerwester, the division's technical director, said the software categorises the World Wide Web conceptually to provide an automated search process that runs alongside existing Internet browsers.
More Like This contains somewhere between 15,000 and 16,000 different concepts. It enables a conventional search to run, but has added conceptual and wide-angled options to transform simple key-word queries into broader concept and contextual retrieval of documents outside the formal query, but related to the topic.
Key in 'Pope' and run a conceptual search and the software will add Papa, Vatican, Eritrea, Ansa and Iglou to the criteria. Ultimately you are still left with about 40,000 documents, but KDL said its aim was to bring the relevant information to the top of the pile. The software has been "crafted to be very gentle to novices." KDL said it has tried to simplify the search process: the browser is incorporated into the software, so only four 'buttons' are available to execute a search. It will run under Windows 95 and 3.1, needs about 7MB of free disk space to install and works best with 8MB or more of random access memory. It sits on top of the software and will currently run with any version of Netscape Communications Corp's Navigator and version 2 of Microsoft Corp's Internet Explorer, although version 3 will soon be compatible. Macintosh and Unix versions should be available with the release of version 2 in six to nine months' time. Deerwester said he has worked on the technology's memory-reduction process the past 15 years, and has now applied to patent his technique, which is able to compress 50GB in to 1.5MB. What is perhaps most impressive about More Like This is its ability to run with Windows 95 and 3.1, which effectively turns text-based word processing files into hypertext documents, and any word selected can be searched for via the World Wide Web. Moore said he has no way to tell how the technology will be used. "It's early days, but this time next year we hope to be established in the market." The software is available for download from:
www.morelikethis.com for a free 21-day trial. And if you like what you see, then a one-off payment of $35 will be charged.
YAHOO, ALTAVISTA AND INKTOMI LOOK TO REGIONAL EXPANSION
Regional marketing was the focus in search engine land last week as Yahoo!, Alta Vista and Inktomi Corp all announced plans to bring regionalized content to the World Wide Web. Inktomi, developer of Wired's HotBot, announced it will partner with Australia's OzEmail to develop a Web search engine, code-named Anzwers, for the Australian and New Zealand Internet markets. Inktomi says it wants to develop similar projects worldwide. Digital Equipment Corporation is also eyeing the Australian market. It intends to set up a "mirror" Alta Vista site Down Under, in partnership with Telstra/Yellow Pages, along with one in Scandinavia.
According to DEC, these mirror sites will contain all the information of Alta Vista's main search engine plus some local stuff. Because they will be set up on separate servers - closer to their expected audience - the mirror sites should be quicker for local users. DEC says the two sites will be up and running sometime in October. The long-term plan is to increase Alta Vista use from 17 million hits per day to 100 million within the next year, with 30 - 35 million from international users.
Not to be outdone, Yahoo announced Yahoo LA, which is being billed as a "comprehensive guide to Southern California". Rather than set up a separate server, Yahoo has elected to provide customized regional content on its main Website. As well as indexing 10,000 local Websites, Yahoo LA provides local news and entertainment information. Director of Yahoo Communities Ellen Siminoff says that the sites were set up to simplify things for Yahoo users who had been looking for more local information.
l America Online has announced that it will be using Personal Library Software, Inc.'s search and retrieval technology on a variety of its products. AOL plans to distribute PLS's "next generation" navigation system to access the Web.
Cadis International Inc. announced version 2.0 of its Krakatoa content management and search technology. Krakatoa uses an object class system to let you author without programming and change data in your database on the fly. Included in the new rev will be improved query functions and a buffed-up user interface. 2.0 will be available sometime in Q3.
US POSTAL SERVICE PONDERS SECURED, REGISTERED EMAIL
The Postal Service admits it has a long way to go before we will be emailing each other registered letters over the Internet, but it hopes to capitalize on its position as the nation's trusted carrier in bringing a broader family of products known as "Postal Electronic Commerce Services" online. Ken Ceglowski, Manager of Electronic Commerce Services, says that historical and legal precedents show that Electronic Postmarking might have an easier time being recognized in the courts than other initiatives.
There is still much to be done before this scheme would work. All users would have to register for both private and public authentication keys, presumably at their local post office. The US Postal Service would then maintain a registry for public/private key authentication. Billing would be comparable to current first class mail rates and could be billed either through ISPs or postal accounts. In the current prototype, mail is billed on a sliding scale, based on its payload size. Ceglowski says the Post Office is looking at existing technologies to provide transport security. He says the email reader would probably be provided free of charge.
HYBRID WEB-CD FOR DEVELOPERS
For those who are sick of waiting for a faster Internet, hybrid CD-ROMs may be the best way of boosting performance without installing an ISDN line. This week Colorado's MarketScape will announce its WebCD 1.0 development kit for creating hybrid Internet/CD-ROMs.
It allows Web designers to integrate Web and CD content through a browser interface, making it seem as though one is surfing the Web at high speed. WebCD is the first product that lets you simply point and click at a Website's URL to create a hybrid CD-ROM. MarketScape expects to cash in first on companies looking for a cheap and easy way of distributing high bandwidth material to their sales force via the Web, but they also expect it to be used for direct mail, catalogs and even for companies that don't feel comfortable posting Website information for just anyone - a kind of 50 cent firewall. The WebCD developer package for Windows 95 costs $975 per copy plus variable royalty fee for each CD. An NT version will be available by year end.
EUROPE OFFLINE:WHO'S NEXT?
There are storms ahead for Europe's online co.s reports Marsha Johnston
On paper, Europe On-Line SA was a great idea. First launched early last spring at a time when great editorial content was considered key to building an on-line services empire, Europe Online was a newborn positively draped in ermine. Flaunting internationally known publications such as Elle, Car & Driver and the Financial Times from its backers, three of Europe's largest media conglomerates - France's Matra Hachette, Germany's Burda and the UK's Pearson Plc - Europe Online was poised to challenge CompuServe Inc for supremacy in Europe's still-young on-line services market.
But when a Luxembourg court granted Europe Online protection from creditors on July 9, it was clear that content alone is no longer a king-maker, and that the traditional on-line services model that made CompuServe and America Online Inc world leaders is rapidly breaking down. For Europe's several hundred small and medium-sized Internet service providers, the CompuServe-America Online business model that includes managing a telecommunications network and computer centre, as well as producing and packaging editorial content, is particularly onerous. Little wonder, in a region where the Internet services market is still nascent and where telecoms infrastructure can be prohibitively expensive.
To make matters worse, the last year has seen every telephone company in Europe make an aggressive push into Internet service provision, for both the business and consumer segments. Deutsche Telekom AG's T-Online, for instance, added some 35,000 new subscribers in November 1995, to bring its total to 933,000, well in excess of leader CompuServe's 700,000 in Europe. Telekom said it was the biggest monthly increase since the service was launched in 1983 as a proprietary viewdata service similar to France's Minitel.
The alternative telecommunications operators springing up around Europe, such as Siris, the joint venture between France's Generale des Eaux SA and Unisource NV, have also joined the fray, making Internet access a low-margin commodity. Just a few weeks before Europe Online's near-bankruptcy, Telecom Italia got the green light from Italy's Antitrust Authority to gobble up the country's leading provider of Internet to consumers, Video On Line srl of Sardinia. Founder and owner Nicola Grauso's ambition to make Internet service in Italy as affordable as "a loaf of bread" by fire-selling it, foundered on the high costs of its worldwide network of high-speed leased lines. for its Internet business.
Europe Online's chief executive Jurgen Becker says "the food chain" of the Internet business has evolved into four segments: access, which comprises operation of the network and its so-called "points of presence" that provide local-call rate access; hosting, which is the computer centre that handles maintenance and billing for Web sites; content, which is the production and packaging of editorial services; and marketing of the service. "Access will be a telecommunications business, because the major [European] telcos are ramping up fast with their IP nets, most of which didn't exist 24 months ago. It is clear that an on-line service like Europe Online cannot win at the access-hosting end of the value chain because the telcos will just throw lots of money at it, so we will not fight them, but will partner with them," says Becker, adding that several of the six potential new shareholders he is talking to are telecommunications operators.
The squeeze is particularly brutal in the consumer end of the Internet service market which Both Europe Online and Video On Line exclusively targeted. "The amount of money you can make on the consumer side of the Internet market in Europe is very small," says Sergio Giacoletto, head of AT&T International's newly created value-added services business unit. "It is coming on very quickly, but there is still another 12 to 18 months of consolidation of existing players."
Corporate services is undoubtedly the most promising specialisation. At one of France's leaders, Grolier Interactive's Club Internet, which is owned by Matra Hachette Multimedia, the Studio, which creates Web sites for companies like Renault, is the only profitable part of the business, says 28-year-old chief executive Fabrice Sergent. The consumer side "will take another three years to break even, when we have enough of a subscriber base," Sergent says. "It's a long-term investment." In the meantime, Grolier Interactive is moving the majority of its Internet traffic to Matra's own satellite, to save money on the cost of leasing lines from France Telecom.
THE END OF THE HOME-BUILT NETWORK?
In a recent study of the European Internet market, London-based Durlacher Multimedia Ltd predicts that, as more and more companies target corporate clients, that market "will see some downward pressure on margins as companies lose money in the early stages in order to gain market share." With the current cost of leased lines in Europe, any drop in margins on services that use them would be disastrous. Per Bilse of EUnet notes that an E1 circuit, either across the Atlantic or to a bordering European country, costs $40,000 per month, while one to a more distant European country can cost $60,000 or more. In contrast, a T3 circuit coast-to-coast in the US - much greater distance, and with more than 20-fold capacity - is $80,000 a month. Thus the cost per mile per Megabit is less than 0.5% as much as in Europe. "America Online and CompuServe are building proprietary networks at a time in the European market when the migration away from a large part of their business model has begun," says Emily Green, an on-line analyst at Forrester Research, Boston. "At what point is America Online going to realise that it really needs to sell its network and get out of being a network operator? CompuServe has already been able to amortise the cost of its enormous network investment in the US, but in Europe it is having to spend new dollars, which becomes very expensive." Green expects that the on-line services market "will ultimately be like the US cable TV market, where you have the cable operator who brings the wire to your house, and the companies providing and distributing the programming are not necessarily at all the same ones operating the network." AT&T's Giacoletto believes that France's Minitel model "is a good example of what will happen. You have the access provider, but this time we will have more than one, because of deregulation, and various service providers, where you will pay for serious business-to-business and consumer information and services."
BATTLING ON BUILDING THEIR OWN.
Judging by their strategies, neither America Online nor CompuServe puts much stock in such predictions about the way the market is evolving. "We are very optimistic about the prospects for the growth of on-line services in Europe, and we will continue to expand our European network two ways: as the customer base grows, we will add more modems and, as we grow out of the UK, we will expand our geographic coverage," declares Jack Davies, president of America Online International.
Although telecommunications costs in Europe are higher, he says, "as a percentage of revenues, they are about on a par with the US." He adds that America Online's marketing costs "are far more critical, in terms of getting to a break-even, than telecommunications costs." For its part, CompuServe is revamping its European network with new technology to let more customers dial in with a local call, as part of a $200m worldwide network investment announced early in the year.
For the on-line service providers like Lyon-based Infonie, however, who lack the critical mass of CompuServe and America Online, the future is clearly different. Infonie chief executive Bruno Bonnell is impatient to move to a new business model: "I'm convinced that access will be ultimately provided only by telcos, and I hope it happens very soon. We only put in a network because the technology was not there, but as soon as possible would like to get rid of network management - when somebody proposes the right technology. Our strategy is to do 100% management of content."
Indeed, only the on-line services like Grolier's Club Internet that are lucky enough to have everything in house may be spared transition or death. Says Sergent, "If we didn't have Matra and its technology, we would be faced with the same problems the others have."
@HOME FINDS PARTNERS, STILL SEARCHING FOR BUSINES MODELS
"Who are we? Why are we here?" are two questions the company hasn't come to terms with, writes Willam Fellows
Highly highly-fancied and leveraged Mountain View, California start-up @Home Corp has announced a raft of content providers that'll use its Internet-based network infrastructure to deliver services into homes, workplaces (@Work) and schools via high-speed cable modem connections.
@Home believes that cable modems supplied by its cable service partners - to date they are Tele-Communications Inc, Comcast Corp and Cox Communications - will eventually allow customers to attach multiple client devices to its network, including PCs, television set-tops, network computers and even gaming devices such as Sony PlayStations. However whilst the likes of the Wall Street Journal, C|Net, CUC International, Knight-Ridder, New York Times, Discovery Channel Online, The Weather Channel and USA Today last week declared themselves to amongst @Home's initial slew of some 60-odd media development program partners, it's not clear who is paying whom for the privilege.
It's indicative of a wider set of questions marks that hover above the company, like what exactly is it? And how it will make money?
MAKING MONEY IS HARD TO DO
It's "model mania" out there, admits Kleiner Perkins Caufield & Byers partner Will Hearst, also @Home's founding CEO and now vice chairman in New York yesterday to talk up the company's prospects to Kagen interactive services conference. "There's no one way of figuring out how to make money in this market."
@Home says the cable providers that actually sell the $35 to $45 per month service into homes and workplaces may pay royalties to it based upon customers' network and content usage or it may collect revenue directly from the cable companies, its Internet service provider and content partners, or a combination of all of them.
Although data transfer rates of 10Mbps into the home and 128Kb or greater back to the network over co-axial cable will allow content providers to change significantly the kinds of services they must currently deliver over low-bandwidth, login-oriented dial-up or dedicated telephone connections, even @Home says it doesn't know what theses services will eventually look like. For comparison, 10Mbits, or ten million bits per second is 50 times faster than ISDN; T1 connections operate at 1.5Mbps.
However for the near-term @Home has identified some positively mediocre objectives, including provision of stock ticker feeds, instantaneous viewing of movie clips, walk-through travel guides, up-to-date sports information, video chats with celebrities, unhindered access to popular sites during peak access periods and personalised content delivery. So aren't we just talking about high-speed Internet access here? No, "we're not just a big pipe," claims @Home VP business development Charles Moldow, "we're an intelligent network," pointing to research which he claims shows that touting @Home's service simply on the basis of improved Internet access speed would deliver only a small percentage of home or business Internet users into its arms. Well how about a high-speed America Online or Compuserve? After all customers will have to use @Home's customised version of the Netscape Navigator browser, an @Home email package, @Home TCP/IP stack and search and query tools.
"We're not a closed community," it says "and we are not a content provider." Whilst @Home claims to have had discussions with AOL and other "closed" communities, we don't know what those talks have been about. In essence @Home's asking customers to buy high-speed net access from its cable partners for $35 to $45 a month. then they'll have to pay for at least some of the services they may currently receive for free on the Internet. But if the model works, it might finally provide a means for content providers to make some real money from being on the net.
EASIER TO DESCRIBE WHAT IT ISN'T
However, because the services of the future and @Home's supposed bandwidth and network technology advantages are still intangible to all except the handful of trial sites across the US, perhaps it's easier to describe what the @Home network says it isn't. It's says it's not about delivering television to PCs, it's not in the television distribution business and video on demand is just one option it'll provide. @Home also doesn't claim to know what the end-user metaphor of the future will be, even though its first paying customers will go live in the fall with browser-oriented interfaces. "The long-term future of the browser is unclear," says Moldow, who believes services will move outside the browser and the browser itself become more componentised.
If there's little @Home can say about the types of content it'll deliver long-term, there's also little that it'll say about its technology partners until September 11th when it plans to reveal all at a press conference in Mountain View.
What we do know is that @Home's private ATM-based backbone will connect to the global Internet at multiple locations; in other words through all of its Internet service provider partners, of which there are said to be many. The backbone will connect information and content providers to regional data centers via a switched data system. The regional data centers will be connected to local hubs, or cable headends, which in turn transport data to end users. @Home has already chosen Silicon Graphics Inc's WebForce Challenge servers combined with Netscape Communications Corp's Proxy software - what SGI calls its WebForce Proxy servers - for the caching servers at the cable headends. Downstream data into the home is carried over a broadband channel, the low bandwidth return path carries commands and responses upstream through the same cable. Initially the only connection requirement will be a PC or Macintosh with an Ethernet connection plus the @Home browser, email software and TCP/IP stack. A high speed modem will be installed by the cable operator. @Home's also created an @Work division to cater for intranets and business users, though it's plans in that area are more shadowy. It's focusing on the high-profile home/consumer users for maximum exposure.
THE CASH IS IN THE CACHE
For content and application providers in its media development program, @Home's created a bunch of enabling technologies for delivering services over the @Home network. Its SmartCache crown jewels allows content providers to store information on local servers, giving users immediate access to data. It also allows content providers to update cached information, something currently not possible over conventional web/Internet configurations where users must reload pages frequently. The cache also sends back information to content providers about exactly which data has been accessed.
M-Cast is @Home's own flavour of Mbone multicasting. On-Net is a content replication facility designed to avert bottlenecks. Knowledge API and Usage Data is claimed to provide demographic information about a web user to site operators without revealing an individual user's identity, allowing site operators to customise content for their visitors.
An @Home Passport of unique identifiers will allow users to access multiple sites without having to enter a password every time. Direct Connect allows content providers to hook directly to users through the @Home network rather than going through the Internet. Members of the media development program will supposedly get access to tools, technologies and proprietary research, network resources, developer conferences and web sites, newsletters and reports.
They're also being offered membership of a technical consortium @Home's trying to establish, though the company wasn't able to say what the intended purpose of the consortium is or whether it yet has any members.
COMPUSERVE SHEDS JOBS AS $29.6M LOSS REPORTED
H & R Block Inc got shot of Columbus, Ohio-based CompuServe Corp just in time, but the shareholders that bought into the company at its flotation don't feel so chirpy about it. The company made a surprisingly large $29.6m fiscal first-quarter loss, blaming a decline in the number of subscribers to its on-line service and the cost of creating its new WOW! family-oriented service and making other improvements.
It warns that it will also make a loss this quarter, but hopes earnings will improve in the second half of the fiscal year. The company is taking stern action, cutting 150 jobs, or 4% of its work force, as part of a cost-cutting program intended to save $30m on an annualised basis. It will also sell the corporate software group of its Spry Inc unit, whose Web browser is a pitiful also-ran behind those of Netscape Communications Corp and Microsoft Corp. The number of people logging off exceeded the 900,000 new subscribers to the company's on-line services, producing a "modest decline" in subscriber numbers. As of July 31, CompuServe had 3.3m subscribers worldwide, which rises to 5.2m with those of the NiftyServe, a joint-venture Japanese on-line service. The company expects increased revenue from advertizing and fees for electronic commerce. The shares dropped 12.5 cents to $13.50 ahead of the news - a nasty tumble from the $30 at which it floated in April.
MOST MIS ANSWER 'DON'T KNOW' WHEN ASKED ABOUT BROWSERS
Netscape and Microsoft may not know it, but most Fortune 1000 companies do not necessarily expect either of the two browser titans to be dominating the market by the year 2000.
In a study released for Merrill Lynch last week by Collaborative Strategies on the growth of IP networks, most respondents chose neither Navigator nor Explorer as the browser that would be on their desktop by the year 2,000. According to Collaborative Strategies principal, David Coleman, "the most popular selection was 'other'".
Collaborative interviewed MIS staff in 100 Fortune 1000 companies. They found a third of the firms were uncomfortable with the rapid pace of software evolution and many intended to continue developing on legacy platforms. Lotus Notes, for example is predicted to grow at a rapid rate over the next half-decade: 279% over the next 2 years, 74% in the two after that. Coleman says, "these companies are focused on selling widgets, not software. They want to amortize their investment". www.collaborate.com
Those feeling restricted by .com or .net international domains should be able to bid to run other domain registries by October (OR issue 1). Assuming some business issues are tidied up, a new ad hoc committee should be formed by early September to produce the specifications for those wishing to run a domain name registry. Applications for the first tranche will be taken until the end of November, and by early January the commitee will have selected the (up to 50-odd) winners. The Internet Society will then sign contracts with them, with the aim of getting the new registries up by the end of January. The commitee will be appointed by the Internet Assigned Numbers Authority, the president of the Internet Society and the chair of the Internet Architecture Board.
However an initial report on C/Net last week, quoting IANA chief Jon Postel on the plan, caused annoyance on the mailing list designed to thrash out the changes. Many correspondents were surprised that Postel's draft proposals were being accepted without the list being notified.
CEO of the Internet Society, Don Heath, confirmed the October timescale was on the
NOVELL OPENS ITS DIRECTORY
SERVICES WITH GREEN RIVER
Novell Inc has announced the open beta availability of NetWare version 4.11 - the Green River release. Among the enhancements is the inclusion of the NetWare Web Server 2.5, designed to enable NetWare to be used as the system for intranet and Internet Web sites.
It incorporates the NetBasic scripting engine, as well as support for Java applets, JavaScript, the Remote Common Gateway Interface, the Local Common Gateway Interface, access controls and logging, as well as PERL script interpreters.
Alongside NetBasic, NetBasic for the Internet has also been added, enabling Web browser users to access and execute Basic scripts across the Internet. Novell has also brought access to its NetWare Directory Services into the Internet fold, by enabling directory information to be published on Web pages; in this way, says the company, end-users can browse the directory (through user names, email addresses, URLs, etc.) for access to information about network users.
Also new with the release is full support for TCP/IP with Dynamic Host Configuration Protocol, as well as C2-level security. Finally, the company has added new NetWare Licensing Services to enable organizations to track and monitor the use of NLS-enabled licensed applications. The software is available for a "nominal shipping and handling fee"; users can register to receive it from Novell's Web site at http://netware.novell.com/river/
MICROSOFT SIGNS CRYPTOGRAPHY DEAL WITH RSA PARENT
Microsoft Corp and Security Dynamics Technologies Inc signed a number of cross-licensing agreements on security technology giving Microsoft greater access to SD's RSA subsidiary.
The pacts would enable corporate users to increase security through the addition of SecurID token authentication to the Windows NT Server network operating system and Microsoft Internet Information Server. Developers' toolkits from RSA will be available which feature Microsoft's cryptographic programming interface, CryptoAPI, enabling the addition of secure features to software products in development. RSA will receive ongoing revenue from Microsoft based on the use of patented RSA technology.
Microsoft will license CryptoAPI to RSA, including rights to incorporate CryptoAPI into RSA's BSAFE and other security toolkit products, to put CryptoAPI up on new systems, and to build on Microsoft's base set of cryptography services.
DOT Gossip
Sprint Corp reckons it's already the world's largest carrier of Internet traffic, but it has been tardy in following MCI Communications Corp and AT&T Corp into Internet access provision for consumers: yesterday it put that right with the launch of Sprint Internet Passport and chose Netscape Communications Corp's World Wide Web browser; Sprint will offer the service free to 200,000 of its existing telephone customers until it is introduced widely in the Autumn and will then charge either a flat rate of $19.95 a month for unlimited access, or $1.50 an hour with no minimum or maximum usage requirement. Microsoft Corp on the case though, and says it hopes an agreement between the two firms can be announced soon.
Some people have been using intranets for some time, and Sharp Corp says it will spend about $30m to expand access to its intranet to offices in Malaysia and other Asian countries: the project will raise the number of its overseas offices with access to the in-house computer network to 51 from 18 by the end of March; some 133 domestic offices are hooked up to the intranet, used for on-line exchange of graphics and text, greatly reducing printing and mailing costs; it also includes access to the Internet, but the technology used was not revealed.
McAfee Associates Inc is to acquire privately-held security software specialist FSA Inc for 356,000 new shares valued at $22.8m: FSA's encryption technology protects information privacy by providing transparent and secure communications across all TCP/IP networks, McAfee says, introducing Secure-1, a network security suite to integrate anti-virus and encryption as a first fruit of the acquisition.
Chrysler Corp 's internal systems department has halted a proposed shift from Unix to Microsoft Corp's Windows NT in favour of using Netscape's browser and server technology, enabling its 5,000 plus dealers to perform remote diagnostics on Chrysler cars; the agreement, which is said to involve a site licence for Navigator and $10m for server software, obviously doesn't extend to its public Web site www.chryslercorp.com , which is liberally marked "best if viewed with Internet Explorer," and it doesn't work very well at all when viewed through Navigator.
The browser wars have now divided those two giants of the US business press the Wall Street Journal and the New York Times, with the Journal tied into a deal with Microsoft Corp and the Times with Netscape Communications Corp for free subscriptions to their Web versions: since the Journal is currently available for free anyway, one might think that Netscape has got the better deal, except that the Times site is by far the weaker of the two, and last time we tried it, it was so slow as to be unusable.
And at least the Wall Street Journal had the grace to declare its interest and last Friday posted a note from the Editor insisting the bundling deal with Microsoft Corp would not influence its coverage.
Microsoft has acknowledged quite a few bugs, or 'issues' as it likes to call them, with Internet Explorer 3.0. Apart from the security issue reported on page 1, the problem with password-protected pages seems to be causing most angst, together with the 55MB disk space requirement. As we went to press Microsoft was promising an updater by the end of the week - so it should be up there by now. The full list of known issues/bugs can be found at: www.microsoft.com/iesupport/content/issues/
Demonstrating just how much it suits companies to deliver their software over the Internet, Cupertino, California based PointCast Network is to ship its eponymous retail package to more than 5,000 computer and electronics stores US-wide by early October - but where downloading it is free, on floppy it costs $20, for which you can buy about one and a half music compact disks; the retail version will include Internet connection software and complimentary 30-day phone support in an effort to justify the $20 charge.
Microsoft Corp has a memorandum of understanding to pay Fremont, California-based StarSight Telecast Inc, developer of interactive electronic television program guides, $20m for a non-exclusive global licence to its intellectual property.
Magdalena Yesil, co-founder and vice-president of marketing and technology industries at Reston, Virginia electronic cash pioneer CyberCash Inc quit and is off to Silicon Valley to head a start-up.
Microsoft Corp says more than 1m copies of Internet Explorer 3.0 were downloaded in its first week of availability.
Ncompass Labs Inc; is about to change direction. The company which has so far made its living with an ActiveX-for-Netscape plugin, will announce its next set of products in a couple of weeks and they will be intranet productivity apps, say sources.
Internet access provider NetCom On-Line Communications Services Inc, Los Angeles, California, warns it expects to incur substantial net losses for the foreseeable future due to intense competition in the on-line industry, it said: in a quarterly filing with the Securities & Exchange Commission, Netcom said it plans to continue its expansion overseas in order to raise its subscriber base; it warned it could not assure continued revenue or subscriber growth or that it will achieve and then sustain profitability or positive cash flow.
L M Ericsson Telefon AB said its Public Telecomunications division will be considerably more profitable a year from now: the unit has suffered from the effects of a wide-ranging rationalisation programme and investments in broadband
communications products, it said; order intake for the half year was up 20%, the company said, but the strong order flow may ebb slightly later in the year, Ericsson added.
Microsoft Corp has sucessfully wooed the two biggest UK Internet access providers, the UUNet Pipex arm of UUNet Technologies Inc, and Demon Internet Ltd, to bundle Explorer with their services where previously they bundled Netscape Communications Corp's Navigator: British Telecommunications Plc said earlier that it was also bundling Explorer, and 20 others in the UK and Ireland are also defecting to Microsoft, the lure being a click-on list within Windows 95 of Internet access providers that bundle Explorer 3.0.
Microsoft Corp's Police Force is falling down on the job: according to the current Cringely columnist in Infoworld, if you look closely at the screens on MSNBC when the camera pans across the newsroom you'll see that the browser the staff at the news channel use is - you guessed it - Netscape .
(c) 1996 May not be copied
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