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In, Around and Online- Issue 2.35 - Week Ending 9/1/95 Copyright (C) 1995 Robert Seidman (robert@clark.net). All rights reserved. May be reproduced in any medium for non-commercial purposes. IN THIS ISSUE ============= One Year of "In, Around and Online" No Newsletter Next Week! Salute - AOL's 10th Anniversary MSN Performance Update USA TODAY Update What's the Deal With Pathfinder on MSN? Dave Pool's One Man Crusade Against Microsoft HotWired Lines Up Backers Miscellany Stock Watch Disclaimer Subscription Information ONE YEAR OF "IN, AROUND AND ONLINE" =================================== This issue marks the 52nd consecutive edition of "In, Around and Online." I wish I could thank everyone personally, because this is one of the most rewarding experiences I've had. There are many of you who have made contributions -- from CEO's to Webmeisters -- those offering comments, asking for stock quotes or sending me tips. It's been a blast. At times, it is difficult finding time to write "In, Around and Online." I lead a double life. Frankly, I'm not sure it will continue for another full year. Nonetheless, I wouldn't have traded the past twelve months for anything. Six months ago I joined IBM and I'd like to thank my management there. They allow me to write the newsletter and go out of their way encouraging me to continue. I especially want to thank my co-workers (at IBM and for the first 6 months of the newsletter, FYI Online) for putting up with my early-morning crankiness, which resulted from burning the midnight oil on newsletter pursuits. Okay, so maybe I was a little cranky before I started writing the newsletter... NO NEWSLETTER NEXT WEEK! ======================== Grassroots Internet zines like this one have a history of "here today, gone tomorrow". I'm proud that I've published every week consecutively for one year. In honor of this achievement, I'm taking next week off. :-) Next week I'll be traveling to France and Israel on business. Since this is my first trip abroad, I'm also planning on packing the camera and bermuda shorts for a few days of sightseeing. I won't have much access to e-mail, so please keep this in mind if you plan to write me. Now, Speaking of anniversaries... A SALUTE TO AMERICA ONLINE'S FIRST 10 YEARS =========================================== A Long, Long Time Ago.. In the spring of 1985, a management group rose from the ashes of Control Video,( a company that had planned to provide video games via modem just as the Atari video game market was bottoming out) to form Quantum Computer Services. In September of the same year, Quantum Computer Services launched their first service, "Q-Link", which was an online service for the Commodore 64 computer. In September, 1985, Q-Link was more than just an "online service". It was the first online service aimed at the mainstream consumer providing an easy to use graphical interface. Then, MS-Windows was just a glimmer in Bill G's. eyes -- a shadow of what it would one day become, the PC's of the day didn't have the fast processors and require mega-mega RAM. Quantum had done something truly distinctive. While their competition were text based services (CompuServe and The Source) Q-Link, delivered a "multimedia" interface complete with sound (music), graphics (albeit cheesy, but hey, it was 1985), and games. The first time I logged onto Q-Link in June of 1987, though already online for many years, I saw that with a modem-equipped computer and an intuitive interface, a piece of the future could be had in the present. Admittedly I'm no longer much of a "chatmeister", but I'll never forget the first time I went into Q-Link's "People Connection". I sat in awe for over an hour merely "lurking". Modems were about communications -- but there is a vast difference between "computers communicating via modem" and "people communicating via computer". What I saw was a tool that made it so easy to communicate that anyone could do it. I believed that sort of tool was powerful. I knew for sure on that June night over 8 years ago, that someday online services would reach the critical mass they're experiencing today. The only surprise at all is that it has taken this long, and the proliferation of MS-Windows as the operating system of choice, to bring online to the masses. Most of you know that Q-Link grew up to be America Online. While America Online is more powerful, has more to offer and is, in general, better than it ever has been, the core group, led by Steve Case has never wavered from its original intent. Make a service that is easy and fun to use. For me, and a lot of other former "Q-Link" folks, the America Online of today is not vastly different from the Q-Link of yesterday. "In our first five years (1985-90), we were in bootstrap mode, creating private label services for Commodore (Q-Link), Apple (AppleLink Personal Edition), Tandy (PC-Link), and IBM (Promenade)," America Online's Steve Case explained to me in a recent e-mail. "In our second five years (1990-95), we launched America Online as an independent brand, and established it as the #1 1 online service," Case added. In 1992, the company went public with an IPO and became America Online, Inc. Aggressive pricing, bundling and direct mail came next. Finally, original services such as PC-LINK and Q-LINK were abandoned so that all focus could be put on the single America Online Brand. The marketing strategy has paid off in spades. Case is pleased with the Company's progress to date, but notes that "there's still a long road ahead in terms of realizing the full potential of this medium." "In the next five years (1995-2000), I am hopeful that we'll really hit our stride, and play a defining role in developing and shaping this interactive medium as it reaches out and attracts a mainstream audience," Case said. Indeed he should be optimistic. In spite of many technical problems associated with skyrocketing growth, AOL has 10 years of experience operating an online service _the right way_. Though far from perfect, America Online has perfected "not being perfect" better than any of their competition. Despite AOL membership's embarrassing Internet moments and heat from seasoned netters, America Online has done more than any other company to bring online to the masses. They developed a proven marketing strategy and if imitation really is the sincerest form of flattery, then AOL should be flush from flattery from their competition, specifically Prodigy, CompuServe and newer services such as The Microsoft Network. America Online will either evolve into something new and better or go the way of the dinosaur. While the Web is great, the Web is controlled by no single entity. As a result, efforts to standardize the foundation of the Web are scattered. America Online is a controlled environment, and they have a strategic advantage: a clear vision. They want to be the biggest and best online service in the world. If they stick to the principles that have made them the number one online service in America, they should help lead the way into the next century by leveraging the state-of-the-art multimedia technology. My hats off to everyone at America Online for a fine 10 years. The next 10 will be interesting to watch. Let's just hope they bring better quality America Online commercials. DR. DAVE SAYS ============= Dr. Dave is my technical adviser. He doesn't say much, but when he does I listen. Friday afternoon, I received this message from Dave: --- From: Dr. Dave To: robert@clark.net Subject: Hot Java for WIN95 Date: Fri, 1 Sep 1995 17:06:53 -0400 http://www.netex.net/w95/windows95/new/hotjava-alpha3-win32-x86.exe Got it, tried it, ditched netscape. Blows netscape into yesterdays low tech. Have a fun weekend. --- I couldn't get to the program via the URL Dr. Dave supplied, but was able to get it direct from Sun at: http://java.sun.com/installation-alpha3-win32-x86.html Note: You'll need to use Win 95's 32-bit winsock.dll for this to work -- if you've installed Win 95, it's probably there already. While the HotJava browser is impressive, I'm not as taken with it as Dr. Dave for several reasons. Sooner or later I'll get around to writing about them. Besides, Netscape has already licensed the HotJava technology from Sun and hopes to incorporate it by next year. MSN PERFORMANCE UPDATE ====================== While the performance problems persist, MSN's General Manager Russell Siegelman has clarified some of the points I raised last week, especially with regard to caching graphics. "Your column isn't entirely accurate," Siegelman wrote me. "We do cache graphics, but not all. For example we cache bitmaps and icons from the content tree (the category windows that you use to traverse the hierarchy of services). This cache is persistent across sessions (ie. across logging off and on again ). "A lot of the content you view is done by a tool called Media View. This tool does cache graphics and text within a title (say within MSN News or MSN Today) on a per session per title basis. So, for example, if you are using MSN News, and you download page 1, then go to page 2, then 1 is cached and is quickly to retrieve it when you go back to page 1. If you close MSN News, or you log out, then you need to download page 1 again. This is NOT true of the category tree, as above (it is persistently cached across sessions). "Later this fall/winter a lot of our MediaView content will be moving to the Blackbird tool. With Blackbird, there is persistent caching across sessions. It is not clear if we will make caching improvements with Media View," Siegelman noted. So, essentially until Blackbird flies, the methods used by Web browsers and proprietary services such as America Online will offer superior performance to MSN since they perpetually cache. In previous issues, I've noted that when using the "Internet and MSN" combo via UUNET, the access to items on the net was very fast and reflected a 28.8 Kbps connection, but that usage of the proprietary MSN software seemingly operated no faster than MSN via a 14.4 Kbps connection. This led me to ask Siegelman if they were back throttling high access speeds to the "online" portion of the Microsoft Network. "We are not throttling," said Seigelman, adding that while they've had "slightly slower" connections via their data center on an intermittent basis, they are working very hard to ensure good performance on all connections. USA TODAY UPDATE ================ Last week, I reported that USA TODAY launched a service on MSN (via Web links) and that they've abandoned their exclusive approach of a "closed Web service" which they first launched in April, 1995. In other words, anyone with Web access can access all of the USA TODAY content, not just MSN subscribers or folks who originally signed-up for the web-based subscription USA TODAY service. Evidently I scooped USA TODAY's own PR folks. This week, they put out an announcement stating that they were in fact now open to the web, and that the full USA TODAY content could be accessed for FREE... for a limited time. As I noted last week, when you access USA TODAY via MSN, you go to USA TODAY's Web pages. When you access USA TODAY via the Web using a browser, you go to USA TODAY's Web pages. In other words, the same content is accessed by either route. This is an interesting "content acquisition" strategy for MSN. Since USA TODAY took the time to make an announcement that they'd launched a service on MSN, I was perhaps expecting different content than the "freebie" Web links. However, it was another deal that made me wonder about MSN's content acquisition strategy... USA TODAY can be found on the Web at: http://www.usatoday.com WHAT'S THE DEAL WITH PATHFINDER ON MSN? ======================================= Time Inc. didn't put out a press release announcing that they were launching the PATHFINDER service on MSN. However, the Pathfinder service isn't positioned from the customer perspective any differently than the USA TODAY service. If you look in the "News" category on MSN, there are choices like "MSN News," "up to the Minute News from Reuters," "Weather", "USA TODAY", and PATHFINDER. Just like USA TODAY, PATHFINDER on MSN is a series of icons that points to various pages on PATHFINDER. I spoke to Stephen Baldwin, a PATHFINDER Editorial Department member, about this arrangement. "We got mail from the MSN Webmaster asking if they could put up some links to our content," said Baldwin, adding that they approved the link request. Sure, why not, everyone wants links. Hell, MSN is CHARGING web services for links to their sites, so why NOT take the freebie. The problem here is that the way that PATHFINDER is positioned on MSN, it appears to MSN subscribers as though it were an MSN content partner. I wrote to Walter Isaacson, Editor of New Media at Time Inc. to find out if PATHFINDER has a revenue sharing arrangement with MSN. Mr. Isaacson has not yet responded (though given the time of year he might be on vacation.) While I can see why PATHFINDER might want to take the links and increase their exposure, the way it looks on MSN is that PATHFINDER is one of MSN's premier news providers. If USA TODAY is in a revenue sharing arrangement with MSN, then PATHFINDER certainly ought to get a slice of that action. From an MSN standpoint, this is an interesting move -- they're lacking in-depth content, so pointing to content that's already out there and positioning it as if it were a part of the MSN service seems pretty smart. Pathfinder is available on the Web at: http://www.pathfinder.com DAVE POOL'S ONE MAN CRUSADE AGAINST MICROSOFT ============================================= Several weeks ago, I received e-mail from David Pool, a CompuServe Executive Vice-President. Pool was the top dog at the company formerly known as Spry. Last March, CompuServe shelled out a cool $100 million to acquire Spry, best known for their "Internet-In-A-Box" software. In the process, Pool probably became a millionaire. These days, Pool heads up the "CompuServe Internet Division" which is also referred to as "Compuserve Seattle." A few weeks ago, Pool contacted me to discuss the fact that Win 95 will overwrite any existing winsock.dll in the \Windows directory when it installs. If you have an existing Internet setup that points to a winsock.dll in the \Windows directory, once you install Win 95, that setup is trashed. It's true. It happens and it happens whether you choose to install MSN or Win 95's networking protocols or not. The solution is to take a backup of your old winsock.dll (if you have one) and replace it with the winsock.dll put in by the Win '95 directory. But wait, there's more. If you want to maintain your own connection, be very aware of a winsock.dll in your \windows\sysbckup directory because there's an identical Win 95 winsock.dll in there, too, which will overwrite your preferred winsock.dll even after your replace it. I confess that I was remiss in not reporting this. Making the above changes doesn't seem like a big deal to me -- in fact, it seems like a day in the life of a typical Windows user. However, I am not a typical Windows user and NOBODY should have to go through that just to fix what was already there. Fortunately, Dave Pool didn't stop his efforts. He kept hammering on reporters until some of them listened. This week, the Wall Street Journal's Jared Sandberg covered these issues . CNN picked it up. And I got about 57 pieces of mail on the subject within 3 hours. For me, the problem described above was never "a problem." I use Netmanage's Chameleon 4.5. Netmanage does something very nice that all software makers should do. They put all of their files in THEIR OWN DIRECTORY. So, even though Win '95 added a winsock.dll to the "\windows directory", my configuration was still intact. If this problem sounds vaguely familiar it's because several months ago, right here in this newsletter, I wrote about another company that was overwriting existing winsock.dll files thus screwing up existing Internet connections. That company was none other than CompuServe with their Netlauncher (also knows as the CompuServe Internet Dialer) created by Pool's division. But this really isn't a case of the pot calling the kettle black. Pool has expressed disgust at what Win 95 does, and he's right on the mark. At least the CompuServe's Netlauncher warned the user through a prompt about the replacement and let the user decide if the winsock.dll in the /windows directory would be over-written. With Win 95 there is no warning, no prompt, no nothing. And again, overwrites any winsock.dll in the \Windows directory EVEN IF YOU DON'T INSTALL MSN or Microsoft's networking protocols. Bob Williams, Marketing VP for Netmanage isn't as concerned as Pool, because after all, his software isn't affected by activity in the \windows directory. But perhaps he should get more concerned. When I installed Win 95, I specifically chose NOT to have their networking protocols installed in favor of the Token Ring set-up that was already in place with the Netmanage software. So, what happened? Win 95 went into my autoexec.bat and config.sys files and remarked out all the statements that loaded drivers for my Netmanage setup. It looked like this: rem - By Windows 95 Network - C:\NETMANAG\NETBIND Remember, I specifically asked NOT TO INSTALL their network protocols. This is "SpiteWare" and it is so pointless. Pool, however, believes there is a point. He feels Microsoft is hoping everyone will just give up and use Microsoft's software and services. It isn't difficult to see where he may draw that conclusion. While other online service executives are decrying the bundling of MSN's access software, Pool is instead intent on making the Justice Department aware of the Win 95 practices outlined above. Pool is also upset that he hasn't received the Win 95 APIs so that he can customize his software to the Win 95 stack. Microsoft claims to have supplied Pool with everything he needs, but Pool alleges that this is not true. I've said before that I don't think Pool will be happy until Microsoft is broken up into separate companies. Next on his agenda -- Microsoft's Blackbird tool for developing software applications for the Microsoft Network. Blackbird is not yet commercially available, but he believes Microsoft is already writing their own applications with it. Pool worries about a day where Microsoft applications like Word and Excel have built-in hooks to the Microsoft Network. He wants the Justice Department to keep their eyes on that as well. While Pool is certainly looking out for his own best interests, his work may benefit others. In any case, he won't stop talking until somebody listens. Pool believes the Justice Department is listening now. Whatever his interests, I'm extremely intolerant of this sort of SpiteWare and wish Pool success in his personal war against these annoying Microsoft practices. HOTWIRED LINES UP ALLIANCES ============================= I received several letters questioning the significance of HotWired's recent announcement that it had lined up major investors including, WPP Group plc, parent of J. Walter Thompson and Ogilvy & Mather, and affiliates of Sega Enterprises, Ltd., Germany's media conglomerate Burda, and Pacific Telesis. These investors combined for about a 15% stake in HotWired Ventures LLC. While raising capital clearly was one factor, according to HotWired CEO, Andrew Anker, the alliances were about "more than money." "We sought alliances that would strengthen our position as an interactive media company," said Anker. The race to secure advertising dollars on the Web is heating up. "[The Web is not just] about a bunch of kids putting up a Web site, this is big media," he noted. "We needed strategic alliances that help us compete." When Anker asks himself who his competition is, he comes up with huge media conglomerates like Time-Warner (PATHFINDER). "We don't own a cable company in Elmira, NY," (referring to recent cable trials by a Time-Warner cable service) noted Anker. Anker pointed out that an alliance with Pacific Telesis would possibly allow them to participate in tests of high speed delivery of the HotWired service. WPP has a lot of marketing and PR clout, and Berda could assist HotWired in European and Asian expansion. Keep a watch on HotWired. According to Anker, a lot of new content, including things like the "Rough Guides" travel guides will be coming up over the next few months. HotWired can be found at http://www.hotwired.com Miscellany ========== THIS IS CNN. James Earl Jones I'm not, but you won't need to use the force to check out CNN. Just fire up your Web browser and point it to: http://www.cnn.com -- A NEW REPORT from SIMBA predicts online revenues to reach $24.1 billion in 1999, up from $13.8 billion in 1994. Today, the consumer market represents only a fraction of the sales cited in the SIMBA report. Online brokerage information services accounted for 45.9% of sales, but the consumer sector is growing at a far more rapid pace than the business services (40.7% growth vs. 15.3%). The report predicts that by 1999 there will be 26 million consumer online subscribers worldwide, compared to the 6.6 million counted in '94. -- STILL NOT BIG ENOUGH? Is the Internet by itself an effective enough marketing tool to drive big revenues? Over month and a half ago, the Wall Street Journal fired up its Money and Investing Update at http://update.wsj.com. This week, the Journal announced that over 65,000 have registered for the site. Not bad, but when you consider that the service is free now, it makes me wonder. Once the "Interactive Edition" consists of the full contents of the Wall Street Journal, they'll begin charging subscription fees. It will be interesting to find out how many users they get then. For now, it seems a disk in the mail is worth more than a free page on the Web. America Online typically signs up 65,000 new users (and gets their credit card numbers) in less than 10 days. -- SEARS TO REVIEW PRODIGY options. According to Reuters, Sears, Roebuck and Co. will complete its review of options involving their 50% interest in Prodigy. "When we have that (review) process done by the end of the year, we'll decide how we want to play and if we want to remain a partner in the company," Sears Chairman and CEO Arthur Martinez told Reuters. While Prodigy is now turning a profit for the first time in 11 years, according to Martinez, the profits are not significant. Prodigy is a 50-50 venture between Sears and IBM. Sears original investment in Prodigy was based on financial reasons and it is questionable whether the investment will pay off. "It is not clear, frankly, that we bring anything (strategically) to it," Martinez said. -- SPEAKING OF PRODIGY - Prodigy recently won the 1995 Dvorak award for "Outstanding Commercial Online Information Service." at the 4th annual John C. Dvorak awards last month in Tampa (in conjunction with One BBS CON). Accepting the award for Prodigy was Steve Larsen who played an instrumental role in launching the Web and Chat services that helped Prodigy get out of the red ink (even if only marginally). According to insiders, Larsen plans to take advantage of recent Prodigy reorganization and leave the Prodigy fold for greener online pastures. -- STILL MORE PRODIGY - Newsweek Interactive (one Prodigy Service that I rave about) has begun offering links directly to the Web from its magazine content. This is the way it ought to be. --- OUR FRIENDS at CMP's Interactive Age ceased paper production in favor of Web production and e-mail deliveries. Now you can buy the cow by e-mail instead of getting the milk for free on the Web. Interactive Age announced in their last stand alone paper version that they would begin offering the Interactive Age Daily by e-mail for $90/yr., $50 for 6 months, or $30 for 3 months. Prediction: they'll drop this approach in 6 months entirely or in favor of advertising subsidized version. Services which provide a similar news for less money already exist. Chuck Martin, publisher of Interactive Age, has not responded to my requests for comment. --- NEWSPAPERS ONLINE aren't saving many trees. Access Atlanta which launched about a year and a half ago on Prodigy has just announced they've reached the 20,000 subscriber threshold. Unless the operation only consists of a few people, this has to be a real money loser. Same goes for TimesLink (also on Prodigy). They made a similar announcement earlier this summer. They must be biting their nails over at Interchange where the Minneapolis Star-Tribune and Washington Post's Digital Ink are hosted. And they said content was king in this medium. Free content, perhaps. -- EAT DRINK AND BE MERRY. Check out Conde Nast's Epicurious site on the Web at: http://www.epicurious.com. Conde Nast continues their trend of grouping Web sites by topic rather than magazine. Epicurious is billed as being "For People That Eat". That ought to have pretty wide appeal. Eating, drinking, playing with your food and more. I tried it, I liked it. -- ROCK AND ROLL IS HERE TO STAY on the Web, courtesy of the Rock and Roll Hall of Fame and Museum. Celebrate the grand opening at: http://www.rockhall.com/ . -- AOL insiders (and outsiders) have told me that the Los Angeles Times report citing a 5,000 capacity for AOL during the Michael Jackson simulchat were wrong. Many wrote in, including one CompuServe employee to say that AOL's capacity during the event was not 5,000 but 16,000. Insiders at AOL claim that they were filled to capacity at the beginning of the event. -- And for the first time in a year, I won't see you next week. But I'll be back with the next issue of "In, Around and Online" sometime around 2 weeks from now... Stock Watch =========== This Last 52 52 Week's Week's Week Week Company Ticker Close Close High Low ------- ------ ------ ------ ------- ------- America Online AMER $66.50 $71.38 $74.50 $14.94 Apple AAPL $56.00 $42.94 $50.94 $32.50 AT&T T $56.00 $55.00 $56.63 $47.25 Bolt,Beranek & Newman BBN $33.13 $34.88 $39.38 $12.63 FTP Software FTPS $22.75 $25.13 $35.50 $19.00 General Elec. GE $58.75 $58.63 $60.50 $45.38 H&R Block HRB $38.88 $37.00 $47.63 $33.00 IBM IBM $102.75 $111.38 $114.63 $66.63 MCI MCIC $24.63 $23.44 $25.88 $17.25 Mecklermedia Corp. MECK $42.00 $40.75 $48.75 $ 4.25 Microsoft MSFT $89.75 $97.25 $110.25 $53.88 Netcom NETC $37.38 $32.75 $41.63 $16.75 Netscape Comm. Corp NSCP $48.75 $52.62 $75.00 $45.75 NetManage NETM $19.63 $20.00 $22.50 $ 8.88 News Corp. NWS $22.75 $23.75 $25.13 $14.38 Performance Syst. Intl PSIX $18.00 $21.62 $25.50 $12.00 Sears S $33.25 $34.75 $35.75 $21.50 Spyglass Inc. SPYG $42.75 $44.00 $54.00 $26.50 UUNET Technologies UUNT $45.13 $48.25 $51.75 $21.75 Disclaimer ========== I began writing this newsletter in September 1994, at the time I was working for a technology company that is now owned by MCI. In March, I began working for International Business Machines Corporation. As of July, my management has agreed to allow me to do some work on the newsletter during business hours (probably about 6-8 hours a week). I speak for myself and not for IBM. Subscribing and Unsubscribing ============================= To subscribe to this newsletter by e-mail: Send an e-mail message to: LISTSERV@PEACH.EASE.LSOFT.COM In the BODY of the message type: SUBSCRIBE ONLINE-L FIRSTNAME LASTNAME Example: Subscribe Online-L Robert Seidman If you wish to remove yourself from the list please DO NOT reply to this message -- send an e-mail message to: LISTSERV@PEACH.EASE.LSOFT.COM with the text SIGNOFF ONLINE-L in the body of the message. An HTML version of "In, Around and Online" is available on the Web at: http://www.clark.net/pub/robert/ .