Case Study
Netscape Communications, Inc.
prepared and submitted by
Gerwin Schalk, MS
gschalk@usa.net, http://www.gerv.org
in group with
Bill Marvin, MS, MIM
bill71120@aol.com
Introduction to eBusiness
Dr. Jack Wilson
Rensselaer Polytechnic Institute
Albany, NY
September 2000
Contents
1 Introduction
1
2 Background and History
2
3 The Company
3.1 People . . . . . . . . . .
3.1.1 Jim Clark . . . .
3.1.2 Marc Andreesen .
3.1.3 James Barksdale
3.2 Company Culture . . . .
3.3 Financial Background . .
3.4 Organization . . . . . .
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
4
4
4
4
5
5
6
6
4 The
4.1
4.2
4.3
4.4
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
8
. 8
. 9
. 9
. 10
Market
Market Segments
Products . . . . .
Groupware . . . .
Channels . . . . .
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
5 Business Environment
11
5.1 Alliances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
5.2 Competitors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
6 Conclusions
6.1 Impact on Business Practises . . .
6.2 Impact on Internet/People . . . . .
6.3 Netscape - a Successful Company ?
6.4 The Future ? . . . . . . . . . . . .
6.4.1 iPlanet . . . . . . . . . . . .
6.4.2 Netscape Portal . . . . . . .
6.4.3 The Mozilla Project . . . .
Appendix
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
.
13
13
14
14
14
14
15
15
16
i
Chapter 1
Introduction
This paper analyzes various aspects of Netscape, Inc. For certain, this company
takes a unique position in the IT business. Not only did Netscape identify a mass
market by itself, it also pioneered and successfully exploited it. Even though the
company was in a highly advantageous position from the start, it could only be
successful by radically avoiding or changing standard business practises.
Netscape was a pioneer in defining and fostering what we now call the ”Information Age.” With technical skills and speed, they changed the way software was
created and distributed, and the way people gather information. They revolutionized how people, organizations, and communities work, think and compete, and
these changes will continue to be sustained, even after the merger with AOL.
In chapter 2, we will discuss the historical background before Netscape was
founded and analyze the reasons for its early stellar success. In chapter 3, we will
talk about the company itself, its culture, people, and background, to shed light on
the financial and human resources the company was based upon. We will discuss
the markets that Netscape was in, Netscape’s products and distribution channels,
in chapter 4. In addition, we will give an overview on alliances and competitors in
chapter 5.
Chapter 6 summarizes the impact of Netscape, Inc., on the market, and on
business practises, since their way of conducting business has become a scheme for
new internet startups throughout the 1990s.
1
Chapter 2
Background and History
The technology and initial infrastructur for the internet evolved out of an effort in
the late 1960’s by the Advanced Research Projects Agency that was part of the
U.S. Department of Defense, which attempted to create a fault–tolerant distributed
network that could be used for communication in a war scenario.
In the early 1990’s, the world–wide–web (i.e., WWW) was not more than a bold
vision. However, most necessary technologies were already in place:
• a system of world–wide unique IP addresses
• TCP/IP as a routable transport protocol
• many application–layer protocols, e.g., SMTP (RFC 821)
• basic services, e.g., file transfer, electronic mail, remote logon
• the pre–cursor to HTML (SGML, ISO 8879:1986)
• already a lot of (see figure 6.1) inter–connected servers
Around 1990, there has already been a mass market for personal computers –
IBM had introduced the first PC in 1981 – and most offices were equipped with computers. However, MS-DOS and (a little later) Windows 3.1, the operating systems
with the dominant market share at that time, were technically badly equipped to
handle network oriented applications. Their graphical capabilities were limited and
networking support was not part of the operating system. However, other operating
systems with much better technical characteristics but a much smaller market share
were present (e.g., Unix, Amiga-OS, OS/2).
In addition, in the most likely place to host networked computers – universities –
most computers ran some flavor of UNIX. Therefore, most people that accessed the
internet and its applications were students or faculty typing in cryptic commands
on UNIX terminals.
2
CHAPTER 2. BACKGROUND AND HISTORY
3
This situation changed, when Tim Berners–Lee, then with the European Particle
Physics Laboratory (i.e., CERN) in Geneva, Switzerland, proposed a global hypertext project in 1989. He wrote the first WWW server, ”httpd,” and the first client,
”WorldWideWeb,” and made them available within CERN in December 1990, and
on the internet at large in the summer of 1991.
This provided the basis for a – yet to come (these programs were largely unknown) – internet killer application for the mass market; a situation, which’s potential the founders of Netscape, Inc., correctly identified.
From that moment on, the web and the internet grew as one, often at exponential
rates. Within five years, the number of Internet users jumped from 600,000 to 40 million. At one point, it was doubling every 53 days. Table 6.1 documents this unprecedented rapid growth of the web and the internet in the first couple of years, whereas
table 6.2 and figure 6.1 list the number of internet hosts from 1981 to 1999. Sources:
http://www.mit.edu/people/mkgray/net and http://nw.com/zone/WWW, respectively.
Chapter 3
The Company
Netscape’s fortune was – at least initially – driven by brilliant people. Without any
doubt, one can state that there would not have been a Netscape, Inc., without the
visionary Jim Clark, the technically ingenious and creative Marc Andreesen, or the
inspiring management talent James Barksdale.
3.1
3.1.1
People
Jim Clark
Jim Clark received a Master of Science degree in Physics at Louisiana State University in 1971. He received a Ph.D. in Computer Science in 1974 from the University of
Utah and an honorary degree, Doctor of Science, in June 1995, from the University
of Utah. He was Assistant Professor at University of California from 1974-78 and
Associate Professor at Stanford University from 1979 to 1982. Clark founded Silicon
Graphics in 1981 and served as Chairman of the Board. In 1988, he convinced the
company to embrace ”multi–media” technology, integrating audio and video into
the company’s product line. Clark left Silicon Graphics in March 1994.
3.1.2
Marc Andreesen
In 1993, Marc Andreesen was an undergraduate student at the University of Illinois
at Urbana-Champaign, working on a project for the National Center for Supercomputing Applications (i.e., NCSA), when he led a team that developed the graphic
interface browser called Mosaic. The first pre–Beta version of Mosaic was released
in February 1993. Version 1.0 of Mosaic was released in September 1993. Marc
Andreesen left NCSA in March 1994 and moved to Silicon Valley.
4
CHAPTER 3. THE COMPANY
3.1.3
5
James Barksdale
James Barksdale received a B.S. in business administration from the University of
Mississippi. He was CIO for Federal Express from 1979-1983, Executive VP and
COO from 1983 to 1992, President and COO for McCaw Cellular Communications
from 1992 to 1994, CEO for AT&T Wireless Services from 1994 to 1995. He joined
Netscape, Inc., in 1995 as president and CEO and steered the company through the
merger with AOL in 1999.
Jim Clarc on James Barksdale: ”Barksdale is a real unique manager. He’s a
very highly competent executive. And good CEOs are people who can either put in
place the processes that begin to work almost in spite of them, and I’ve known CEOs
like that... But then there’s another style of CEO that has sheer leadership and
charisma and insight and makes quick decisions and leads through sort of a different
thing. That’s Barksdale. For my personal style, I find it very agreeable. He’s an
easy person to know and an extraordinarily good leader. He’s a very approachable
person. People feel like, wow, he’s got this real personal style. People just love it.
It’s a very unique thing.”
3.2
Company Culture
Behind Netscape’s formal, visible structure lied a well–developed set of values that
can certainly be called a key source of strength and an engine for innovation and
growth.
One key value was the strong adherence to openness, cross–platform products,
and independence of specific desktop operating systems. Jim Clark stated ”We
always adopt protocols that remain in the public domain. We have no proprietary
protocols. This is different from, say, Lotus Notes and Microsoft Network, which
are based on proprietary systems.”
A second key value lied in the companie’s embracement of speedy, continuous,
and major innovation. Clark declared, ”The old model of developing new–product
cycles every three to four years just doesn’t cut it anymore... Today, you have to
work in ’internet time’ to survive.”
The aura of speed permeated every aspect of the company culture – Netscape
sacrificed almost anything for speed. If necessary, they acquired entire teams by purchasing the whole company, as they did with Collabra. Decisions were sometimes
made in short ad–hoc meetings in hall–ways. Tom Paquin, Director of Engineering
on the client side, commented: ”We move fast. You have to take a lot of responsibility upon yourself. The world is reinvented every few minutes. Forecasts are
wrong; you cannot predict the speed with which things will happen on the internet.
To try to put it in a word, it’s invigorating. If I had one more word, it might be
encompassing.”
CHAPTER 3. THE COMPANY
3.3
6
Financial Background
In April 1994, Jim Clark and Marc Andreessen started Netscape Communications
Corporation, with the former investing $4 million as seed capital in the venture. In
May, the company issued 3,350,000 shares of common stock, Clark and Andreessen
each purchasing 720,000 shares, then valued at 1/20 cents per share. In September
1994, the venture capital firm Kleiner Perkins Caulfield & Byers provided a second
round of financing.
Netscape used its initial infusions of capital to develop its first product, released
in the last quarter of 1994. By spring 1995, the company needed new sources of cash.
After less than twelve months in operation, 11% of Netscape’s stock was acquired
for approximately $17.5 million by a consortium of five companies.
During the first two quarters of 1995, the company and its products became
increasingly well–known. On June 23, 1995, Netscape was filing for an Initial Public
Offering (i.e., IPO). Through its underwriter, Morgan Stanley, Netscape planned to
offer 3,500,000 shares of common stock, having initially estimated a value somewhere
between $12 and $14 per share. On August 9, 1995, the day of the IPO, 5 million
shares were offered at $28 per share.
Netscape quoted a net loss of over $4 million on total assets of over $42 million.
Despite never having declared a profit in its short operating history, the stock was
immediately the subject of intense speculation. Multiple factors contributed to the
sudden rise in Netscape’s share price – opening at $71, trading as high as $74.75,
and ultimately falling to $58.25 on the first day. Clark’s shares were valued at more
than $500 million, Barksdale’s at more than $240 million, and Andreessen’s at more
than $50 million.
3.4
Organization
Initially, Netscape’s major organizational focus was on creating an environment
that fostered pace–setting software development. Its software work, guided by Andreessen and managed by Richard Schell (Senior Vice President of Engineering), was
often highly individualistic in nature and required the creative talents of a highly
select group of people. Netscape organized its work in teams, with Engineering
Directors and Product Managers guiding project work from the engineering and
marketing perspectives, respectively. Projects were generally grouped by type of
application, by product and by platform.
Netscape followed a structured product development approach, developing two
versions of each product concurrently, although this added significant complexity. In
any case, the advantage of parallel development was speed. Cross–functional product teams from Marketing and Engineering meet once a week. Each version was
effectively ”work–in–progress” to which new features were constantly being added,
depending on feedback from the market and on the competition. This combination
CHAPTER 3. THE COMPANY
7
of speed, multiple overlapping efforts and competition, created substantial management challenges.
Netscape’s expansion and the growing complexity of its product line were putting
increasing pressure on its existing management operations. After the IPO in August 1995, Netscape needed to integrate an ever–expanding cohort of professional
managers, including a growing number of executives reporting to the top layers of
management.
Engineering and Marketing had the main functions in the firm, then there were
Directors, Senior Product Managers and Product Managers. Netscape also had a
Developer Relations Group and an International Group responsible for local product
customization.
The global nature of the internet and the growing internationalization of Netscape’s geographically dispersed businesses further complicated the organizational
challenges facing the company, as Netscape operated a number of sites oversees that
undertook a wide range of activities.
Netscape also faced the task of appropriately absorbing outside structures into
its organization, when they used their financial resources from the sky–rocketing
stock price to acquire other companies and intellectual property.
Chapter 4
The Market
4.1
Market Segments
Early on in its history, personal computer users were the staples of Netscape’s business. The browser technology, on which Netscape had temporary dominance over,
was a boon to PC technology and usability. The company quickly saw other markets,
however, and the limitless potential for them. Netscape products were soon helping
the online user securely purchase various goods and services and communicate with
others through e-mail.
If the individual temporarily was Netscape’s bread-and-butter, the business customer represented the promise of its future. Jim Clark saw this from the beginning,
noting that both usage of the world wide web and network access would increase
exponentially in the years to follow.
In its short history, Netscape had engaged with many companies in the broad field
of internet commerce. Early on, its partners included the corporate heavyweights of
the telecommunication, computer, financial services, and publishing business sectors.
Because this was not a core competency of the company, yet a critical ingredient
for future growth in the industry, Netscape sought strategic alliances in order to
leverage its market position. This was not unusual for the industry. In fact, most
analysts saw it as a strategic necessity for success in the arena in which Netscape
was playing.
From the start, Netscape saw all aspects of different types of connectivity as
tremendous opportunities. It saw the increasing need for information not only between companies, but even within an organization. The company foresaw great
future promise in the Intranet, a company web, which had all of the features of
the internet, yet singularly focused on the intra–communication needs of an organization. A firewall shielded the intranet from the ’external’ internet. The intranet
enabled information to be dispersed to every member of the organization, even across
hardware platforms.
In its view of the market, Netscape sought to improve on its market position,
8
CHAPTER 4. THE MARKET
9
and kept this thought front and center when developing new products. Its idea was
to develop integrated single-source products that were planned with the user of the
future in mind, and solve the anticipated technical problems of the future. They
were to appeal to as large an audience as possible, and hit the market as quickly as
possible. From the company’s first product (Navigator, that is) launch in late 1994,
Netscape had sought to develop products in a manner in which it had a comparative
advantage.
Specifically, it wanted to market to as broad a base as possible products that
were innovative in thought, yet simplistic enough so that the average person could
manage with and not be confused by them. They needed to be coupled with a fully
responsive service support system, be protocol compliant, and have a high usability
quotient. Moreover, it wanted these products to enter the market dynamically, and
again, as quickly as possible.
4.2
Products
From its breakthrough Navigator browser, Netscape sought to improve on its browser
product line, introducing several subsequent Navigator editions. With each upgrade,
the company added on an increased number of technical features. For instance,
one upgrade (Navigator 3.0) brought with it fully integrated video, audio, 3D, and
telecommunications capability on the internet. All the while, the company sought
to diversify into other areas including servers and groupware.
From this point, Netscape saw the great need for integrated applications, and
set out to supply to its customers products that were complete, with all the requisite technology and maximum connectivity, yet user-friendly. In short order, it
introduced several products, which fed off both the web and the company’s other
marketing launches. One of these more complex product introductions created an
internet shopping mall, while another gave Netscape the ability to use their collaborative interests to build a virtual community. Still another breakthrough product
catered to the small business owner who was looking to get a presence on the web
and create a second storefront for his/her business.
4.3
Groupware
Netscape also branched out into groupware. Groupware, as its name suggests, allows
a group of people (typically in a company setting) to work together on a common
task in an ordered fashion. The classic example, and most familiar to the masses,
is Lotus Notes. Netscape’s venture into the groupware market was a watershed in
that it marked the company’s first overt attack on a competitor of mammoth size.
IBM owned Lotus Notes and was the nation’s leader in groupware sales.
CHAPTER 4. THE MARKET
10
When Netscape introduced its first integrated client/server software to include
groupware in late 1996, it included several of the key elements, which stood as
requisite features of that groupware. The company had accepted integration as
a necessity for success in the industry, recognized intranets as a largely untapped
business market, and incorporated groupware and all its salient features in stepping
up to compete with companies many times its size.
4.4
Channels
How did Netscape market its products, and how successful was its channeling? Of
course, Netscape blazed the trail for the internet as a tool for marketing its products.
In this, the company was a groundbreaker and the method highly successful. Not
only could it reduce time to market and cut down on product development time by
getting web users to effectively test its products, but Netscape also found the web
to be a prime distribution vehicle. In fact, the internet helped the young company’s
acceptance with the public, and forever established the internet as a method of
distribution to be incorporated in other company’s channel strategies in the future.
Of course, even in this online environment, other more real, tactile channels were
needed. Netscape had a strong premise sales force, which was supplemented by a
telephone sales division. This was where a client could talk to a ”real person” and
also to where internet leads were directed. The company realized this channel as
the final ”point of sale” in many instances, and increased its staffing accordingly.
Even though the role of the sales persons is clearly defined here, not lost is the fact
that many of these customers were introduced originally to the products through
the internet, either directly through reference, or indirectly through random surfing
or viral marketing.
Supplementing these two channels were indirect channels such as OEMs and systems integrators, and international sales and localization. Netscape moved quickly
and effectively to localize its product to different regions of the globe. Netscape
products were released in many languages, and backed up by support and service,
designed to ensure that cultural sensitivities and language standards were being
met.
Chapter 5
Business Environment
5.1
Alliances
As we look back at the ”lay of the land” in Netscape’s business segment, it is quite
apparent that future success in its business environment was to be predicated on size
(i.e., customer base), speed, marketing (both strategic and tactical) and strategic
alliances. It was imperative for Netscape to keep this knowledge ”top of mind” as
it forged into the future. Though by nature a company that accentuated its offense,
it had to think defensively when juxtaposed with a potential virgin competitor like
it was a few short years earlier entering the market to engage in battle.
With that in mind, strategic alliances, based on what was happening in the industry (and - more importantly - what would be happening in the industry) became
a critical factor. Such an alliance - a combination of industry assessment, Netscape’s
position within the field, and technological forecasting - took into consideration, by
definition, the company’s competition. In November of 1998, a blockbuster of an alliance was formed, which significantly changed the face of Netscape and is currently
shaping the industry as a whole.
America Online announced at that time that it was purchasing Netscape. Included in the statement was the announcement of a strategic partnership with Sun
Microsystems, a major hardware and associated service provider. This alliance was
a preemptive shot at Microsoft, a mega-competitor to at least two of the three companies, and a behemoth of a company, which was (and still is) the subject of a
federal anti-trust lawsuit.
If bottom-up marketing is doing what you do best, then this alliance provided a
classic example of how each of the three companies leveraged their core competencies
and capitalized on their comparative advantages in the industry. AOL had the
large customer base. Netscape had the innovative internet technology, and Sun
had the hardware, support service, and loyalty of its customer base. Why was
and is this recipe successful? AOL received through Netscape access to advanced
technology that a company of Netscape’s size never would have had the capital
11
CHAPTER 5. BUSINESS ENVIRONMENT
12
to market correctly. With this coalition formed, Netscape continued on, yet its
corporate definition changed dramatically. It was now a role player in a larger
organization, rather than a self-contained unconventional business upstart, which
succeeded beyond everyone’s wildest expectations.
5.2
Competitors
Leading up to the big merger, Netscape was not looking for alliances. In fact,
the company relished its position as an independent Silicon Valley success story.
Though it did not seek opportunity from the type of alliance, which it eventually
entered, Netscape was quite vigilant for competitive threats which potentially stood
to undermine its business. The four prime competitors Netscape guarded against
were itself (against its own indolence), groupware vendors bundling other products
and services, web-based software and operating system vendors and the biggest
competitor, Microsoft Corporation.
Naturally, Netscape concentrated most of its efforts versus Microsoft. In the
beginning when Netscape was a fledgling company, Microsoft ignored the internet,
and thought it not to be the future choice of the masses. Bill Gates changed his
tune on that score quickly, however, upon seeing individuals and businesses flock to
the web in the mid 1990’s. In time, Microsoft entered the internet arena with its
well-publicized considerable resources. In fact, within a few months of Netscape’s
IPO, Microsoft had decided to voraciously pursue an aggressive Internet strategy.
In a program it called ”embrace and extend,” Microsoft embraced accepted Internet
standards, while extending their reaches so as to include features available exclusively to them. This strategy was intended to - once again - tie consumers to (at
least partly) proprietary standards. The Microsoft threat was enormous, given its
limitless capital resources, and was only squelched with the AOL merger.
Chapter 6
Conclusions
Netscape Communications, Inc., was a child of a newly–born generation of internet
companies that solely relied on the internet in every aspect of their existence.
Being founded in 1994 and acquired by AOL in late 1998, the company was
around as a stand-alone entity for not more than five years. Yet, however, their impact on many aspects of computing in general and on business models was tremendous. Some of the practises they introduced where only valid at their particular
time, but many have changed the industry permanently.
6.1
Impact on Business Practises
Netscape radically changed or violated many standard business practises. Among
its actions were:
• Founding a company without a business plan
• Going public without having a documented history of earnings
• Giving customer base growth priority over developing a business revenue model
• Giving away the product for free
• Making speed one of the key elements in the company culture
• Trying to hype their own products and publicity to spark investor’s interest
• Using assets from the over–inflated stock price to acquire other businesses or
intellectual capital
As mentioned, some of these actions were only valid at the particular time they
were practised, e.g., founding a company without a business plan has again become
as important as it was in ’traditional’ business, which the first wave of failing .com’s
clearly demonstrates.
13
CHAPTER 6. CONCLUSIONS
6.2
14
Impact on Internet/People
It is very difficult to think about an internet without Netscape’s influence. Certainly,
a world-wide-web would be existing, although possibly its development might have
been a little slower. In any case, Netscape pioneered the early days of the internet
and strongly contributed to its rapid growth.
Therefore, Netscape played an important role in the transition from single computers in the PC era to the millions of inter-connected computers, or ”appliances,”
in the information age.
Today, people, groups, and even enterprises, can gather every possible information on the internet (although there are caveats about the reliability of the various
sources), an approach radically different from the ”snail-mail” approach they would
have used just five years ago.
In that sense, Netscape’s impact on the internet in general or on single people
has been tremendous.
6.3
Netscape - a Successful Company ?
Although certainly mainly a matter of definition of ”successful,” from many perspectives Netscape can be classified as being a triumphant winner.
Netscape started out from (well, almost) nothing and grew its company and
shareholder value. Netscape established what the internet is today and fostered the
transition into the information age.
Finally, the AOL-Netscape-Sun alliance seems to be an extremely capable and
powerful player in a global market of eBusiness and eCommerce. What more does
the definition ”successful” need ?
6.4
6.4.1
The Future ?
iPlanet
As part of the AOL–Netscape–Sun alliance, Netscape still lives on as a powerhouse
in internet–software, even though they are now a division within AOL. From the
business perspective, iPlanet has everything that a successful enterprise eBusiness
service provider might need: the financial backing and the distribution channels or
business connections from its ’parents’ AOL, Netscape, and Sun, and an apparently
broad and cutting–edge technology product line that makes them an end–to–end
business services provider. In that sense, it is much better equipped than Netscape
itself was.
From the technical perspective, iPlanet sets on the open–standard model, as supposed to a model of proprietary standards that Microsoft embraces. Microsoft uses
CHAPTER 6. CONCLUSIONS
15
proprietary standards to, after they killed competitors in a market, gain long-term
control over it. Since eBusiness is a large playing field, where so many different components have to interact, it seems likely that it will be difficult to take over the whole
market and enforce proprietary standards. As a result, the open-standards model
certainly has a good chance of being the better model in an eBusiness environment.
In any case, iPlanet will be a major player in the eBusiness software and services
provider market.
6.4.2
Netscape Portal
Netscape’s Netcenter as a vertical portal for internet services has been one of
Netscape’s key assets in the merger with AOL, which was more than justified considering Metcalf’s law and Netcenter’s couple million subscribers. Although it is
difficult to determine, which role portals will play in the future, Netcenter, which is
at the moment being streamlined with the AOL customer base and content services,
will certainly play an important role besides the other portal powerhouses.
6.4.3
The Mozilla Project
In the process of the AOL merger, the Netscape browser has thought not to bear
significant value and has thereafter been spun off into an open-source project (i.e.,
ironically, Mozilla). At the time of writing, this group has released Netscape 6
Preview Release 2, barely more than a beta version. Although this browser will incorporate and support all current standards and will – from the technical standpoint
– easily compete with its biggest rival, Microsoft’s Internet Explorer, the missing
commercial market, together with the fact that Microsoft bundles Internet Explorer
with each copy of one of their operating systems, does not seem to let the future
shine bright for this project.
Appendix
Date
Hosts
% chg
1-Jul-88
33,000
1-Jan-89
80,000
142%
1-Jul-89
130,000
63%
1-Jan-90
203,200
56%
1-Jul-90
276,400
36%
1-Jan-91
376,000
20%
1-Jul-91
569,373
51%
1-Jan-92
727,000
28%
1-Jul-92 1,067,588
47%
1-Jan-93 1,410,243
32%
1-Jul-93 1,923,304
36%
1-Jan-94 2,227,730
16%
1-Jul-94 3,225,177
45%
1-Jan-95 4,851,843
50%
1-Jul-95 6,641,541
37%
1-Jan-96 9,472,224
43%
1-Jul-96 12,880,699
36%
Domains % chg
900
2,600
189%
3,900
50%
6,100
56%
8,200
34%
11,200
20%
16,000
43%
17,000
6%
16,300
-4%
21,000
29%
26,000
24%
30,000
15%
46,000
53%
71,000
54%
120,000
69%
240,000
100%
488,000
103%
Web Sites % chg
50
150
200%
720
380%
3,140
336%
11,400
263%
28,200
147%
100,000
255%
230,000
130%
Table 6.1: Table of early internet and web growth figures
16
APPENDIX
17
Date Internet Hosts Date Internet Hosts
08/81
213 10/90
313,000
05/82
235 01/91
376,000
08/83
562 07/91
535,000
10/84
1,024 10/91
617,000
10/85
1,961 01/92
727,000
02/86
2,308 04/92
890,000
11/86
5,089 07/92
992,000
12/87
28,174 10/92
1,136,000
07/88
33,000 01/93
1,313,000
10/88
56,000 04/93
1,486,000
01/89
80,000 07/93
1,776,000
07/89
130,000 10/93
2,056,000
10/89
159,000 01/94
2,217,000
Date Internet Hosts
07/94
3,212,000
10/94
3,864,000
01/95
4,852,000
07/95
6,642,000
01/96
9,472,000
07/96
12,881,000
01/97
16,146,000
07/97
19,540,000
01/98
29,670,000
07/98
36,739,000
01/99
43,230,000
Table 6.2: Table of internet host numbers
Internet Host Count 1981-1999
50,000,000
45,000,000
35,000,000
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
Aug-98
Aug-97
Aug-95
Figure 6.1: Figure of internet host numbers
Aug-96
Aug-93
Aug-94
Aug-92
Aug-90
Aug-91
Aug-88
Aug-89
Aug-87
Aug-85
Aug-86
Aug-83
Aug-84
Aug-81
0
Aug-82
Number of Internet Hosts
40,000,000