Netscape’s Success Draws Throng to Developers Meeting

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At 7:30 a.m. Tuesday, an hour when nocturnal software developers would normally be asleep, an enthusiastic throng of programmers marched into San Francisco’s Moscone Center for the opening of what the Silicon Valley cognoscenti are calling “Netscape Nation”--the first software developers conference put on by Internet phenom Netscape Communications.

“If we had done this meeting a year ago, I dare say that none of you would be here,” Netscape Chief Executive Jim Barksdale told a standing-room-only assembly. In that span--short in human years but almost a lifetime in the Internet equivalent--this upstart has become a force to be reckoned with, and more than 3,000 people are expected to attend the three-day conference, which ends today.

Given that most of those in attendance are hoping to make their fortunes by creating products that work with Netscape’s phenomenally successful software, one might have expected a love fest.


But at breakfast on opening day, a surprising number of people seemed willing to bite the hand that feeds them. For even though Netscape is a small company that’s not yet 2 years old, it’s already facing a backlash that’s part envy and part fear.

“You don’t want to see one company control the market,” said Daniel Weinreb of Object Design, a small software developer in Burlington, Mass. “There’s a lot of e-mail going around--people who resent the kind of power Netscape has.”

While another developer nodded in agreement, Weinreb fretted that Netscape’s position means it is now able to set standards, something he prefers be done democratically.

“There’s a panel on one way of doing security, but not on the other method,” Weinreb said. “It’s not that one is more effective than the other, it’s just that Netscape has decided to focus on one.”

Weinreb began spinning sinister intentions on the part of his host, not realizing that Netscape’s engineering director, Rick Schnell, was among his table mates.

“How can you say we’re too powerful?” Schnell retorted. “We’re a little company.”

The unease of the developers isn’t entirely without foundation. They can prosper by building programs that work with Netscape’s Navigator, the dominant program for browsing the Internet’s World Wide Web, and the Netscape server software that often runs the Web sites.


But in some respects, they will live on the scraps that Netscape chooses to ignore--scraps that can be very nourishing unless Netscape decides it likes what’s on a developer’s plate. Just ask the companies that sell software for Microsoft’s Windows, many of which are now struggling because the PC software giant decided to grab their piece of the market.

Still, Netscape is far from securing anything like dominance of the Internet. Indeed, the company has much bigger things to worry about than disgruntled developers--including the urgent if unwanted attentions of the industry’s two biggest software makers.

At his company’s recent developers conference, Oracle Chairman Lawrence Ellison said: “We . . . worry that Netscape will get the same kind of lock on the Internet that Microsoft had on the operating system,” Ellison said. Although 75% of those who ‘surf’ the Net use Navigator, Ellison said he has no plans to concede defeat.

“We’re not going to stand down on our browser,” he said. “We do not want one company’s browser to dominate.” And since his company sold about $1.3 billion worth of its database software last year--compared with $80.7 million for Netscape--he may be able to back up his threat.

Microsoft, also late to the Internet party, is an even bigger threat, and is now using all the brutally aggressive tactics it is notorious for. Both Netscape and Microsoft give away their browsers for free over the Internet, but Microsoft has gone one better: It is giving away the server software as well.

That is especially troubling to Netscape, which has given away its browser in the hope of making money off the server software. Investors are worried: Netscape’s high-flying stock has been falling steadily, and Wednesday it dropped an additional $5.125 to close at $45 on Nasdaq.


In just a few weeks, Microsoft has shipped 30,000 copies of its Internet Information Server for creating sites on the World Wide Web, the portion of the Internet able to display graphics and play sound. Fat profit from Microsoft’s PC software business is subsidizing the giveaway.

Start-up Netscape doesn’t have that luxury. But it has rolled back prices with a new line of server software as much as 40% cheaper than previous versions. It hopes the price cut, along with its reputation as the Internet leader, will keep customers from flocking to Microsoft.

“The Internet is a big ocean and there’s a lot of room so that everyone can run their battleships and not run into each other,” said Netscape CEO Barksdale.