Happy Puppy Runs Circles Around Most Internet Dream Chasers

Sandra Woodruff thought she had a clever idea. Her housemates in Issaquah, Wash., a couple of computer game designers, were complaining yet again that they'd gotten the short end of the stick in dealing with a big game publisher, so Woodruff proposed that they bypass the big boys and put demonstration versions of their own games on the World Wide Web. To draw visitors, they would also post demos of well-established games.

The Issaquah Three, as they might have been called in an earlier age, started their little venture on Valentine's Day, 1995, which is astonishing considering what it looks like today.

Happy Puppy, the name they eventually adopted for their site, now has 40 employees and expenses of about $350,000 a month. Happy Puppy users download 2.5 million demos from the site per month, and more than 10,000 Internet users have created links to Happy Puppy on their World Wide Web pages.

Woodruff's brainchild also has a very rich new parent. Happy Puppy (http://happypuppy.com) has been acquired by Attitude Network, a new company led by ESPN founder Bill Rasmussen, who has said he plans to develop niche programming to be delivered via cable, radio, print and online media "with the same intensity that ESPN puts forth in serving the sports enthusiast."

The price is in the "multiple millions," Woodruff says, although that money will be paid as part of a long-term deal.

Everybody is always talking about how to make money on the Internet. The story of Woodruff and her housemates, Jennifer Reitz and Stephen Lepistow, is a lesson in how some people actually succeed in doing so. As is so often the case with these things, the trio had no idea what they were getting into.

Woodruff, 44, is a broadcasting engineer with a dry wit (Happy Puppy was originally named Accursed Toys) who had only recently discovered the Internet, and in the early days her housemates held down two full-time jobs--one as a programmer, the other with the phone company--to keep the venture going. There was no revenue from Happy Puppy until February or March, Woodruff says.

But there sure was growth. Indeed, Happy Puppy's growth has been so phenomenal that the service blew up every Internet service provider that tried to cope with the staggering volume of traffic generated by the site. Having begun by paying a small firm $28 a month for a Web page, Happy Puppy ran through a whole series of unfortunate hosts, including one that lasted only a month. The site is now hosted by Worlds Inc. (http://www.worlds.net/), best known on the Internet for Worlds Chat and AlphaWorld but also the possessor of some humongous bandwidth.

This growth didn't happen all by itself. The partners were extremely Net-savvy about getting attention for their site. For instance, they spent a considerable amount of time on game-oriented newsgroups, answering questions from gamers and modestly pointing them to the Happy Puppy site. (For game lovers who want to visit such newsgroups, try any of those beginning with comp.sys.ibm.pc.games or, depending on your religion, comp.sys.mac.games)

Before long, it was clear that Woodruff and her housemates could forget about trying to sell their own games; they had a full-time business in running a site that basically promotes games made by others. Woodruff says the industry as a whole didn't immediately sign on to the concept.

"We've had hideous battles with these clowns to get them on the Internet," she says, adding acerbically, "It's amazing the large percentage of people on the Internet who have computers."

Happy Puppy has succeeded in part because game players like to try out a game before they buy, so computer makers often make available demo versions to give customers a taste and perhaps get them hooked. Additional scenarios or play modules can then be purchased. Since demos often find their way out onto the Internet before their official release, "we have full-time people searching the Net for new game demos," says Woodruff, adding, "About half of our users surveyed say they make buying decisions based on the demos they download from Happy Puppy."

Happy Puppy isn't the only site offering game downloads. In fact, it has succeeded in part by emulating Dave Stanworth's Games Domain (http://www.gamesdomain.com/), a well-known games site that predates Happy Puppy.

"I stole everything I know from them," Woodruff jokes. In fact, Woodruff and her partners built Happy Puppy on a solid understanding of computer games, long hours at the keyboard, and an unwavering focus on divining what game players want and then providing it. "We're not trying to change their tastes," says Woodruff. "We just cater to them."

The same pragmatic attitude accounts for the service's name. As I said, it started as Accursed Toys, but "the suits really hated it," says Woodruff. In search of something less edgy, the partners hit upon the canine moniker as a cheerful alternative.

Happy Puppy does this well in part because its operators have a good sense of who plays computer games--and it's not necessarily who you think. In fact, one of the ways Happy Puppy brings in revenue is by surveying its users online and selling the data, which can be valuable to game marketers.

Say "computer games" and "you imagine an 8-year-old kid twitching away on a Nintendo system," Woodruff says. In fact, though, Happy Puppy finds that the typical computer game fiend is a 23-year-old college-educated (or college-enrolled) male.

Besides selling data, Happy Puppy makes money by selling ads. So far it has carried advertising from some game companies, but also for such geek-oriented staples as Old Spice, Olean Potato Chips and Sunny Delite. Eventually, says Woodruff, a Happy Puppy magazine seems likely.

Most of all, Happy Puppy took tons and tons of hard work, and still does. Woodruff, who has the title of publisher, used to like playing computer games. But of course, nowadays she has no time.

Daniel Akst welcomes messages at dan.akst@latimes.com.

His World Wide Web page is at http://www.well.com/~akst/

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