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In, Around and Online, Issue 2.34 - Week Ending 8/25/95 Copyright (C) 1995 Robert Seidman (robert@clark.net). All rights reserved. May be reproduced in any medium for non-commercial purposes. Author's Note: I'm experimenting with a longer format this week and am interested in your feedback. Love it or hate it, let me know. I may not be able to reply to everyone, but I will read every message that comes my way. In This Issue... ================ -Note To AOL Subscribers -Another Day, Another LISTSERV -What Happens Now? -MSN: Okay, So It's Here -Bill G. Trashes Steve C. -Sports Subscription Services -AOL Delays Internet Service -Miscellany -Stock Watch -Disclaimer -Subscription Information Note to AOL Subscribers: This message will exceed AOL's 25Kb mail buffer and they've changed the way they handle large e-mail messages. Instead of splitting the mail into two pieces, they present you with the first 25K only. You can then download the entire document which will exist as an attachment to the e-mail message you're reading. The good news here is that you can now send file attachments back and forth between AOL and the Internet. The bad news is that you first have to load up the 25K document AND download the document to see the whole thing. Reports coming in last week indicated that the file looked a lot better if it was imported into a text editor or Word Processor. Carriage return codes were left in the document when downloaded, but reportedly, that's an AOL bug which will be fixed, if it isn't already. I'm glad that files can now be transmitted from AOL to the Net and from the Net to AOL, but many will find the new feature annoying. The only acceptable solution is for AOL to increase the size of their mail buffer. In the future, I'm sure that will happen. The above comments apply to the Windows version of AOL -- I am not sure if they hold true for the Mac version. Another Day, Another LISTSERV ============================= Win 95 Day (August 24th) brought two momentous events. The least publicized was the move of the In, Around and Online mailing list from Clark Internet Services to L-Soft International, the worldwide distributor of LISTSERV mailing list software. The reason for the move is simple -- I experienced some difficulties as evidenced by a swell in the number of people missing issues -- a number which exceeded 100 last week and that's just the number of readers who contacted me. My thanks to ClarkNet for providing me, at no charge, with LISTSERV on their facilities since November '94 and to former L-Soft employee, Jim Jones, who was instrumental in getting the list established on ClarkNet. The new home is: listserv@peach.ease.lsoft.com . Everything else remains the same... What Happens Now? ================= We've been talking about all the "future" services for months, and with the official launch of MSN most of them have now debuted. With no fanfare at all, Interchange launched in June. Since the combination of Delphi and Internet MCI barely qualify as a "venture", MCI also included FYI Online (my old company and in more ways than not, the genesis of this newsletter) and MCI Mail. Even with these elements the MCI venture still doesn't add up to even a Prodigy with regard to # of users and revenue. The online businesses is moving so quickly there's little time for analysis. I'm still figuring it out, too. In many ways, the environment is similar the early days of TV. Lots of folks see the power in the new medium, but the masses haven't caught on. However, the growth over the last two years has turned a lot of attention on "interactive media", especially in the online and Internet arenas. Modems aren't a new tool, they've been around for many years. Starting from the time it began almost 10 years ago as Quantum Computer Services, it took America Online 8 years to reach a base of about 300,000 users. In the last two years, they've added over 2.7 million. Though perhaps not as dramatic as AOL's growth rate, other services also have experienced record growth. Netcom announced this week that it had climbed to 200,000 users and that it had released a new version of its "NetCruiser" point and click software for surfing the net. A recent report (On the Internet: User Demographics and Trends) from Wilton, Connecticut based SIMBA estimated that end the end of the 2nd quarter of 1995, there were only 282,000 direct dial access accounts being paid for by individual consumers. If that's the case, Netcom is currently the America Online of the Internet Service Provider (ISP) market. The numbers from the SIMBA report might sound shocking at first, but consider that there are only hundreds (not thousands) of local ISPs. ClarkNet is the biggest local ISP in the Baltimore-Washington area, but they have less than 5,000 accounts. Further, the SIMBA estimate focused on consumers who went out of pocket for an Internet service and may not take into account Internet access supplied to individuals by their employers. Even if you take the SIMBA estimate and double it, today, the stand alone ISP market is much smaller than the online services market. Those who have predicted the demise of the commercial online services may have spoken too soon. The new SIMBA report mentioned above predicts that commercial online services will have 27 million subscribers by the end of the decade (roughly %284 growth in less than 5 years). Such predictions must seem like welcome words to fledgling new commercial services and struggling old-timers like Prodigy. While the environment in today's online/Internet marketplace may seem like the early days of television, in many other ways it mirrors the post divestiture long distance telecommunications market. The break-up of AT&T led to the creation of many long distance telecommunications companies. When the dust settled, there were 3 major companies (AT&T, MCI and Sprint), a handful of smaller (though successful) players and a lot of companies who are much smaller than the big 3 in scope and in size. Many of you may remember the feeding frenzy and merger mania that occurred as the big 3 of the long distance market settled into place. I believe we'll begin to see the same thing happen in the commercial online/Internet market where both major and minor players buy, merge with, partner with or crush their competition. We've seen some of this already as evidenced by News Corp/MCI, and network affiliations like the one between AT&T and BBN and the one between Microsoft and UUNET. The dust won't settle for a while yet -- it's going to be great fun to watch! MSN: Okay, So It's Here ======================= * Speed Issues Persist * August 24th has passed and the Microsoft Network is officially launched. MSN announced early this month that they would freeze subscriptions at 500,000 to evaluate performance and other issues before opening the service back up. For many, it will be difficult to determine whether performance issues reside with MSN or in Win '95 itself. Those of you running Win 95 on a 486 processor with 8 megabytes of RAM or less, may be wondering why they opened the service up beyond the number of subscribers lined up via the Beta test. Win 95 is great, but even on a 486 DX2-66 with 8MB of memory, it is no speed demon. Exchange, Microsoft's replacement for MS Mail and the E-Mail client used for MSN, opens VERY slow with only 8MB of memory on the 486-66. My boss complained how awful it was, and I didn't believe him. I mean, it wasn't lightening quick with 16 Megabytes, but, it wasn't awful. So, I pulled 8 MB out of my system to take it down to an 8MB system. Conclusion: Windows '95 likes memory one wholeheckuvalot. The same could be said about Windows 3.1 -- more memory was always better. In fairness, though some of the speed aspects have absolutely nothing to do with MSN. Opening the Exchange client without being on MSN doesn't change the fact that it loads slowly with only 8 MB of RAM. My experience with the software shows that the 32 bit applications included in Win '95 (MSN included) run slower than 16 bit applications. Because of this, people with medium to low-end systems may find MSN frustratingly slow. Microsoft says Win '95 can run in 4MB, but even they recommend 8MB on the box, and they clearly state a requirement of an 8MB minimum for MSN and Exchange. I don't think people on the medium to low-end systems will want to use MSN if they only have 8MB of RAM. If they do, they have the patience of Job or they're willing to give up multi-tasking to devote their system exclusively to MSN/Exchange when they're online. Will MSN be compelling enough to make people want to go out and buy more memory? Perhaps not, but the reality is that sooner or later, 16 MB of RAM will be the requirement to run all the cool multimedia applications, etc. Until everyone has 16MB of RAM, I look for MSN general manager Russ Siegelman to do a little bit of finger pointing at the operating system when it comes to performance issues. But there are places which are definitely MSN related where speed could be greatly improved. The most obvious is their "MSN Today" screen, which launches along with the "Main Menu" as soon as you sign on. If you sign on to MSN more than once per day, you may find the "MSN Today" banner annoying. They have several graphics on that page, and the graphics are not cached to your hard drive thus requiring the artwork to re-download each time you log on (or have some desire to select MSN Today from the main menu). Seems to me they could vastly improve perceived performance by caching the banner graphics locally with updates only when items change. The same could be said for many other forms/documents on MSN. Here, the World Wide Web outshines MSN in its ability to cache graphics and update as changes to forms are made. * FINALLY, A LITTLE MORE CONTENT * Microsoft Network has put up more content on their system adding news, weather, and several other service including USA TODAY, and PATHFINDER (which are just icon "short cuts" to their Web pages) and NBC. Look for Microsoft to add much more content in the weeks and months ahead. The announcements made by USA TODAY this week were somewhat confusing. My apologies for jumping topics slightly, but some of the reports on the USA TODAY announcements in the press were incorrect. I'll try to clarify this, but some of it still doesn't make much sense. In April, USA TODAY announced a subscription service. The model was a bit unusual. The services ran off the Web, but ONLY with a special connection (via the CompuServe network). Up to now, people with direct web access could get to USA TODAY's home page, but mostly the page served as a marketing tool. Some links to the USA TODAY content were available, but most were not. The page's purpose was to show what type of information you could get if you signed up for the subscription service. At the time I remarked that it seemed really dumb for them to have a Web based service that wasn't accessible via the public Internet. I'm happy to see that they've now opened it up. In USA Today's announcement they noted that the subscription service no longer requires special software, (but they'll still provide that for folks without Internet access for $12.50/month for 3 hours and $2.50/hour for each additional hour -- no bargain here, folks). I went to the USA TODAY pages from MSN and which let me hit all the links from their web pages. Next, I signed off MSN and accessed the home page via my regular provider using Netscape and it worked identically. Now everyone with web access can get to all the material including AOL and Prodigy subscribers. The confusion seems to come from the statement that the service will be available at no additional charge for a limited (though undisclosed) time. As it migrates to an additional fee based service on MSN, it is unclear whether additional content will be made available to MSN subscribers exclusively. I'll keep you posted. Back to MSN... * IT'S NOT ALL BORING * While I have chided MSN for being "boring", there is hope. Microsoft knows how to use multimedia technology as proven by the success of Bookshelf and Encarta (both available in slightly stripped down versions via MSN) as well as special interests titles such as Complete Baseball. Some of what I like best about the interface of these CD-ROMs has been incorporated into MSN services. For example, if you go to MSN News (which is structured in an attempt to give the look and feel of a real newspaper) and you select "News Browser", then "sports", then "front page" and then (phew), "RIPKEN: Does Your Work Ethic Compare to Cal's?", you'll be presented with a neat form. The form includes a picture of Cal and some options to bring up "balloon" style information on Cal (such as remaining games to break Lou Gehrig's streak, bio, etc.). It also lets you to enter personal information to calculate the number of consecutive years you'd have to work (or go to school) to be like Cal. Though fun to look it and play with, it's a bit cumbersome to get there and loaded with mouse click madness. G MSN has employed shortcut keys called GO Words which work identically to the similarly named function on CompuServe, America Online's KEYWORDS and Prodigy's JUMP feature. This option is available under the "Edit" menu. The good news is that MSN does include a robust "Find" feature, under the "Tools" menu. They'll need to work to make GO words more intuitive and could do so by putting them somewhere where I can learn what they are. But the Ripken chart is fun and a clean example of making basic content more compelling by GETTING THE USER INVOLVED with the content. Remember, this is an interactive medium. Despite the many MSN positives (with more to come as the service matures) the major minuses persist. The navigational monotony of "drilling down" to find what you want and the sluggish speed will likely frustrate subscribers. Like many other MSN users, I keep wondering if I'll need a Pentium to get the performance that I want. Bill G. Trashes Steve C. and my Final Whine on Bundling ======================================================= "Have you ever gotten a magazine with an AOL front-end (software disk) in there? Look in your garbage can sometime and see if you can't find three or four in there," a gloating Bill Gates remarked in an interview summarized in Friday's Wall Street Journal. Many of you might not have gotten far enough into the above referenced article to read that particular gem. Speaking for myself, I had trouble getting past the first part of Gates' comment in response to whether he felt the government was being unfair. "That's too strong. But this thing about MSN, I hope people know it's a laugh when they hear that one," said Gates. When asked why, Gates offered: "MSN is not bundled with Windows 95. We haven't restricted our competitors in that business from doing anything. They've announced deals with Compaq, deals with Packard Bell. Have you ever gotten a magazine with an AOL front-end (software disk) in there? Look in your garbage can sometime and see if you can't find three or four in there." I guess I was so busy laughing that I choked when I got to "MSN is not bundled with Windows '95". Billy G. is playing the semantics game. The SERVICE is NOT bundled with Win '95, but the software definitely is. U.S. Attorney General Janet Reno announced this week that the Justice Department IS continuing their anti-trust investigation matter regarding the bundling of MSN software with Windows '95. My stance remains firm: If Microsoft has the same success with Win 95 they had with Win 3.1, their dominant position as the the world's primary operating system DOES give them an unfair advantage in the online arena if they continue to bundle the MSN software. The irony is that all providers are counting on the success of Win '95 to drive new business. Clearly, Win '95 and MSN have already done good things for the industry most notably: - Drive down the base price of online services - Ensure that the other online services will strive to develop better products and services - Attract even more media attention on the online world which will motivate more people to get wired. "We are big supporters of Windows 95," is what Scott Kurnit told me. Kurnit is the CEO of the newly formed (and yet to be named) News Corp/MCI information services joint venture. "It will make computing easier which will be a big plus for our business." "However," added Kurnit, "irrespective of what the Justice Department decides, citizens shouldn't let the company that controls the heart of the computer also control its eyes and ears." New Corp/MCI have used the launch of Windows '95, including the MSN issues to create a site on the Web called "Breaking Windows Wide Open", which includes commentary, analysis and reviews of Win '95. The site is available at http://www.delphi.com . As a side note, Newscorp/MCI's Kurnit offers the following when asked when new service offerings from the venture will be launched: "My reply is WE HAVE... At the moment of the formation of the venture we offered (prize) money to the net community to interact with us by helping name the service/s we are offering," Kurnit said, adding, "then we come back just 2 weeks later with best site on the net about Win 95." Next week, I hope to find out when Newscorp/MCI plans to launch services that will put "minutes, minutes, minutes" on the MCI "network, network, network," and what they plan to do to stimulate usage of the internetMCI, MCI Mail, and FYI Online services. Sports Subscription Services ============================ Starwave Corp. said this week it will launch a paid subscription service to users of ESPNET SportsZone http://ESPNET.SportsZone.com) on the Web, beginning on August 28th. The service will continue to offer basic sports news and information, scores and chat free of charge. The subscription- based service will include special areas and more in-depth content, including special coverage of events (U.S. Open tennis), multimedia (audio and video clips, and as photos), in-depth commentary and analysis from over 30 writers and AP news and photos. The timing and the pricing of ESPNet's announcement appear to be a direct response to the small Florida based start-up, SportsLine USA. Last week, SportsLine USA announced the SportsLine WWW subscription service (http://www.sportsline.com) would be available for $4.95/mo. or $39.95 a year. ESPNet came out with identical pricing. SportsLine USA is backed by the high-tech venture capital firm Kleiner, Perkins, Caulfield & Byers and high visibility sports figures like Joe Namath and Mike Schmidt. SportsLine has also lined up the backing of the NFL Players and popular sports authorities like NBC's Bob Costas. SportsLine claims that no service available today, including ESPNet can match the comprehensive data. Can these efforts succeed as subscription based services? ESPN is a popular brand name and their recent success on the Web has led to high dollar advertising revenue from the likes of Gatorade. Some analysts have chided ESPNet for wanting it both ways (advertising and subscription revenue). While most subscription based services haven't met with great success, I believe ESPNet and SportsLine can succeed. ESPNnet has actually played this very smart. They've kept the content that most people want to see FREE. Sports scores and schedules remain free, and the scores are the big attraction. Sports fans seeking more coverage may find it worth the $4.95 per month or $39.95/yr. for more in depth coverage. There are a lot of sports junkies out there, so I think ESPNet stands a better chance of success than anyone else playing the subscription game right now. Since the sports scores are free, the masses will still come, the advertisers will still be happy, and ESPNet may surprise a lot of people with the number of paid subscribers they sign up. The paid subscriber base will be far less than the number of people accessing for free, but for ESPNet, because of the advertising revenue generated from the free areas, I think the model can work. AOL Delays GNN Internet Service =============================== Previously announced to launch on August 24th, it didn't make it. AOL claims that they didn't want to be overshadowed by the Microsoft hoopla. AOL Services Company president, Ted Leonsis says AOL is seeking their "own day in the sun". I don't buy it. They knew the hoopla would be there. Far more likely is that there are still some problems with the software and configuration set-up. AOL had started the testing of the Booklink software under the name MegaWeb prior to acquiring GNN. Now AOL wants to brand the service as GNN and I think there is a problem if they want the accounts to have the GNN domain name (@gnn.com). That domain already existed for GNN and I suspect they tinkered with switching from megaweb.com to gnn.com. All I can tell you is that for about a week, I received mail for robert@gnn.com (not me) on my robert@megaweb.com account. There hasn't been a new Beta version in over 2 weeks. The service is easy to use and the Web browser works fairly nicely. But the Newsgroup implementation is slow and frustrating. Also, because the software shares some code with the Windows 2.5 AOL client, users can't connect to AOL via TCP/IP from the GNN/MegaWeb service. Miscellany ========== AOL EASTER EGG? Somebody at AOL has a great sense of humor. Users of the Windows 2.5 client can find an hysterical Easter Egg (if it's still there) by going to Keyword: ROADTRIP. Road Trip is a great way to take your friends on a tour of AOL or take one of the AOL "escorted" tours of the system. But, starting from the bottom left of the screen if you click on the second very bright start, you'll get a surprise from the Van door. Don't look, Ethel... -- COMPUSERVE REVENUES ROSE 45.9% (to $186.5 million) during parent H&R Block's fiscal first quarter. Block CEO Richard Brown cited the exceptional revenue growth in the company press release but warned that new initiatives at CompuServe (including lowering the rates) will hurt earnings in fiscal 1996. CompuServe claims that their world wide numbers rose from 3 million last quarter to 3.4 million at the end of July. Remember though, CompuServe counts at least 850,000 Nifty-Serve accounts. While CompuServe does get royalty payments from these accounts, they do not get $9.95/acct. CompuServe membership in the U.S. lags behind America Online to the tune of about 1 million customers. That's a tune Steve Case and AOL enjoy dancing to. -- LAST WEEK, I commented on comments made by Time Inc.'s new media guru Walter Isaacson. Isaacson wrote to explain that when he threw out the "7 million hits" reference for the number of hits the PATHFINDER site gets weekly, he was speaking to a group who were in attendance at a conference about the Web. Isaacson said he figured the audience he was speaking to would know how to interpret the numbers. I'd quote him directly, but during the great LISTSERV '95 switch, I managed to delete Isaacson's response. I think he has to be more responsible in throwing a number like that out when members of the press are in attendance. C|NET (http://www.cnet.com) CEO Halsey Minor agrees. "Since we read this statistic we have been wondering what in the world they were talking about. The problem is reporting this kind of inaccurate, meaningless data forces everyone else to swim upstream with advertisers when we try to give meaningful data, like the number of pages served or the number of ads served. Obviously, some people want to throw out the biggest number they can get their hands on even if it obfuscates the relevance of "good" site data," said Halsey. "...Lack of clarity and quality in online metrics only makes it harder for advertisers to enter the market," added Halsey. " The more online content involves real money, the better the industry needs to get about providing relevant data." -- GERMAN PUBLISHER Axel Springer Verlag AG plans to take a 10% stake in Europe Online, according to German magazine Der Spiegel. British media group Pearson Plc is rumored to be pulling out of the venture to make room for Axel Springer. Europe Online, using the Interchange interface was originally to have launched by now, but is now claiming launch in the 4th quarter in Germany, France and Britain. Without instant messages and chat I don't see how it can succeed in the consumer market. Perhaps those are the reasons for the delay? -- WPP INVESTS IN HOTWIRED -- According to a report in the Wall Street Journal, advertising conglomerate WPP Group of Britain has agreed to become a minority investor in HotWired. No details were disclosed, but the Journal quoted two officials who said WPP planned a 5% stake. Why is HotWired shopping for investors? I hope to tell you next week. -- DISNEY ANNOUNCES ONLINE PLANS -- You knew Eisner wasn't going to pass up cyberspace, it was only a question of when they'd get there. This week, Disney picked Jake Winebaum of its magazine publishing operation to head up Disney's Online initiatives. "Essentially Disney has decided we want to be in the online business," Winebaum said in an interview with Reuters, "The time is right. We have the right strategy, let's form the organization to do it." Indeed, leveraging its Disney and ABC resources, Disney is a content powerhouse. The problem with content is that with the exception of specialized content (a la business services) not many want to pay much if anything for it. Mostly, people want FREE content. Disney is probably still kicking itself for making the Disney Channel a paid premium service. It isn't clear whether this will be a content service only existing online either on the web and/or one or more of the big commercial services. If they plan a full-fledged service, complete with their own front end, this could bring new meaning to the phrase "Talk about your Mickey Mouse Services!" Stay tuned... -- Stock Watch =========== This Last 52 52 Week's Week's Week Week Company Ticker Close Close High Low ------- ------ ------ ------ ------- ------- America Online AMER $66.75 $71.38 $74.50 $14.94 Apple AAPL $44.88 $44.88 $50.94 $32.50 AT&T T $55.00 $52.13 $55.88 $47.25 Bolt,Beranek & Newman BBN $35.00 $34.88 $39.38 $12.63 FTP Software FTPS $23.25 $25.13 $35.50 $14.88 General Elec. GE $58.63 $57.75 $60.50 $45.38 H&R Block HRB $40.13 $37.00 $47.63 $33.00 IBM IBM $105.38 $111.38 $114.62 $66.38 MCI MCIC $23.50 $23.44 $25.88 $17.25 Mecklermedia Corp. MECK $45.25 $40.75 $48.75 $ 4.25 Microsoft MSFT $94.38 $97.25 $110.25 $53.88 Netcom NETC $37.75 $32.75 $39.50 $16.75 Netscape Comm. Corp NSCP $51.25 $52.62 $75.00 $48.75 NetManage NETM $19.88 $20.00 $22.50 $ 8.25 News Corp. NWS $22.13 $23.75 $25.13 $14.38 Performance Syst. Intl PSIX $20.00 $21.62 $25.50 $12.00 Sears S $35.13 $34.75 $35.75 $21.50 Spyglass Inc. SPYG $41.25 $44.00 $54.00 $26.50 UUNET Technologies UUNT $44.75 $48.25 $51.75 $21.75 Note: Mecklermedia Up on the news of an impending 2-1 stock split. 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/ .