Microsoft to Unite Web Sites
In a push to become a major gateway to the World Wide Web, Microsoft Corp. is expected to announce next week that it will begin beta tests of a “start” page that closely integrates the software giant’s Internet properties and gives customers quicker access to resources on the Web.
The effort is part of a broader reorganization that will put Microsoft’s various Web development efforts, including the troubled MSN Group, into a single organization called the Web Lifestyle Group.
After the start page goes through a test period of several months, new users of Microsoft’s Internet Explorer Web browser will be automatically sent to a Microsoft start page (https://home.microsoft.com). From there, users will be able to access other Microsoft services and content.
Microsoft Network (https://www.msn.com) is the ninth-most popular Web site among home computer users as ranked by Media Metrix, which tracks Internet activity. Microsoft’s corporate Web site, https://microsoft.com, ranks fourth but lags far behind the No. 3 site of rival Netscape Communications Corp. (https://www.netscape.com). More tightly integrating the sites could boost Microsoft into the top two or three Web sites, analysts said.
The ability to demonstrate a high volume of traffic enables a company to command higher rates for advertising.
Microsoft has been increasingly concerned about attracting more people to its Web sites so it can bring in the subscribers and advertisers it needs to help cover the hundreds of millions of dollars a year it is spending on content development.
In addition, a heavily visited site would presumably guide more users to Microsoft’s potential moneymakers, such as https://expedia.msn.com, a travel site; https://investor.msn.com, a personal finance site; and https://carpoint.msn.com, a site for researching car purchases.
The Redmond, Wash.-based company has made a number of moves recently to bolster its Web presence. Last month, it acquired Sunnyvale, Calif.-based Hotmail Corp., a Web-based provider of free e-mail that boasts 9 million members.
To provide a more effective system for helping customers find information on the Web, Microsoft entered into a partnership agreement with San Mateo, Calif.-based Inktomi, an Internet search engine. And Microsoft’s research division reportedly is working on software to improve the quality of Net searches. Both the Inktomi technology and the Hotmail services will be available on the new start page.
Microsoft is in the midst of a heated court battle with the Justice Department, which has accused the company of failing to honor a 1995 consent decree by forcing computer makers to install Internet Explorer as a condition of selling Windows 95.
Critics cite Microsoft’s recent moves as examples of the firm’s using its power unfairly and to the potential detriment of competitors.
“In cyberspace, access is king,” said Gary Reback, a Palo Alto lawyer who represents several Microsoft rivals, including Netscape. He postulated that consumers won’t replace the Microsoft page, making it the first site they see when they log on to the Web.
“There is a huge first-screen bias when the first thing someone sees is a Microsoft site,” Reback said.
But Harry Fenik, vice president of Redwood City, Calif.-based Zona Research, said users can easily reconfigure their browsers to start on their preferred page. Most Internet service providers, including IBM, Fenik said, configure their software so that users are automatically sent to their home page.
Others suggest Microsoft’s move to consolidate the sites may be merely an effort to salvage what looks to many like a failed experiment.
“MSN has been a bust,” said Brian Murphy, an analyst at the Boston-based consulting company Yankee Group.
Microsoft Network was presented as the company’s answer to America Online when it was launched in 1995. Although the service has gone through several make-overs, it continues to be plagued with billing and other problems.
MSN’s 3 million paid subscribers--those who have Internet access through MSN--represent less than a third of the customer base of America Online. And several MSN Web products that were initially available only to paid subscribers were moved to a free Web site after they didn’t attract enough customers.
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The consolidation plan is modeled on the successful approach taken by Yahoo (https://www.yahoo.com). Although users were initially attracted to Yahoo as the place to start their search for sites on the Web, the company has developed an elaborate menu of offerings, such as news and online commerce, that draws users back.
Yahoo, which reported 65 million page views a day in the fourth quarter, has been one of the few sites able to charge high rates to advertisers. The company reported that 1997 revenue rose 242% to $67 million.
Netscape is following a similar strategy to take advantage of the millions of Navigator browser users who go to the company’s Web page by default upon launching the software program. Analysts estimate Netscape’s Web site revenue totaled nearly $100 million last year and could increase by 35% this year.
