Jim Barksdale, president and CEO of Netscape, redefined the company'ss from the browser war. Steven Palmer reports. direction following the loss of half its revenue after the decision to provide Navigator for free.
Barksdale returned all but $1 of his salary for 1997 and renounced his share options - worth potentially $13 million in order to show his concern and commitment to the company. The company's shares climbed nearly 30 per cent on 17 April after rumours of a Sun takeover bid, something Barksdale denied.
Netscape has suffered heavily from the browser war with Microsoft, a major factor behind its decision to provide free access to Navigator and Communicator source code. Barksdale was clear on the financial impact the move had on the company. 'A year ago, half of our revenue came from the browser. But we got off the morphine of addiction to revenue from it, and the market has stabilised since. Most companies would be happy with sixty per cent of a market,' he said. The company now makes its money from the Website and enterprise servers.
Making the browser and code free opened it up to thousands of developers.
'The majority of smart people in the world do not work for my company, so this opened it up to creativity. Microsoft has a team of about 1,000 developers working on its browser. I now have 10,000.' He added that with such widespread development in the Netscape browser, it would become an 'egoless programme' covering every language and culture in the world across all platforms.
Vars were reportedly pleased that the browser was now free since less sales time would need to be spent explaining why customers had to pay for Netscape's browser, while Microsoft's Explorer browser was free. He concluded: 'No more browser wars. You want them, you take them.'
Barksdale conceded that Windows 98 would be successful, but added that 25 per cent of users had both browsers on their desktops. He said he was always concerned about Microsoft but remarked that the software giant had backed off recently over ongoing investigations by the US Department of Justice. 'It is getting more open and we'll fight it out, as we did with Windows 95, but it has got to cut people some slack.'
He added that the internet was heading towards use by set-top boxes, Net telephones or other internet devices, not PCs, and that the internet device area would be an attractive area for Netscape.
The company has also commisioned an IDC survey to check European trends for mission-critical applications and the intranet.
Jim McGovern, senior analyst at IDC, revealed: 'We are moving into the second wave of the internet. Client/server technology took four years for mission-critical applications to migrate to it, but in less than 18 months, large corporates have begun to adopt intranets. Sixty-one per cent of the companies surveyed were already using, or planning to migrate to, mission-critical intranets.'
However, there were concerns. McGovern added: 'Consultancies like to paint a rosy picture, but it is not all rosy - the main concern is over security.'
The security issue was revealed as particularly important for e-commerce, account management and customer care. The implementation of these mission critical systems was also covered by the report: 'Vendors and the parts of the channel that provide services and consultancy for intranets are very well placed,' said McGovern.
The most popular choice of company type to implement internet business-critical applications were systems integrators. However, UK Vars were revealed to be doing better than their European counterparts (see graph).
When questioned over possible acquisitions, Barksdale admitted Netscape was an acquisitive company, having taken over eight companies in the last 12 quarters and laughingly referred to BT as a likely candidate: 'You have to ask is it cheaper to buy it or build it?'
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