Netscape to Offer RealNetworks Software

RealNetworks Inc., a Seattle-based pioneer in Internet multimedia software, plans to announce today that Netscape Communications Corp. will distribute its video software for free, giving RealNetworks a new edge in an escalating battle with Microsoft Corp.

By using Netscape’s popular browser to give away its software, RealNetworks gains access to 70 million Netscape users who can download its software for playing audio and video on personal computers.

Microsoft also makes a video player that it gives away through its own Internet browser, alongside an older version of RealNetworks video software. Last month, though, RealNetworks persuaded America Online to distribute its software to AOL’s 13 million customers.

In addition, International Business Machines Corp. last Monday began distributing RealNetworks’ latest video-player technology to 25 million corporate users of its popular Lotus Notes software.

Semiconductor giant Intel Corp., traditionally a Microsoft ally, has licensed its technology for advanced video software to RealNetworks.

So far, RealNetworks has been able to maintain a 90% share in its technology, which makes Internet videos appear smoother and closer to television quality and speeds the long waits that can occur when downloading large files across slow Internet connections.

RealNetworks has managed to use Microsoft’s strategy of giving away popular technology to its own advantage. While it gives away its main video software, the pint-sized company makes money on programs that broadcasters use to transmit content over the World Wide Web.

No one is discounting Microsoft, which has a history of devastating software rivals by giving away products, a key issue in the government’s antitrust lawsuit against the company, which starts today.