AOL, Microsoft Target Internet Novices
Like political foes fighting for the middle ground, Microsoft Corp. and America Online Inc. are moving closer from opposite directions as they redesign their Internet software to appeal to “undecideds,” the great, silent majority of people who have yet to go online.
Microsoft, the master of complicated software, made a foray into AOL’s simpler turf recently by releasing a Web browser that mimics AOL’s colorful picture menus. The new software is radically different from Microsoft’s popular Internet Explorer and is aimed at novice users. Its biggest change is the placement of oversized links to Microsoft’s own Web sites across the top of every page in a graphical menu that replaces Internet Explorer’s tool bar.
As AOL has done for years, Microsoft’s new MSN Explorer creates the impression that you are inside a private world rather than surfing the wide-open Internet. Butterflies flit around, envelopes fly through space when you send e-mail, and a soft-spoken lady even talks when you sign on and off.
As Microsoft is simplifying, AOL is adding advanced features and making at least some of its pages look more like the standard Web services from Microsoft, Yahoo Inc. and other portals. AOL’s 6.0 software update won’t be released until later this fall, but the preview version shows AOL adopting Web design standards in its personal finance channel, including longer pages, banner ads at the top and a horizontal navigation bar with plain text “tabs.” AOL executives say the finance channel has sophisticated users who appreciate the Web design touches, but they’re not planning to expand them to all the channels.
It might seem odd, but it isn’t surprising that AOL and Microsoft would meet in the middle of cyberspace. AOL, after all, has always been better at marketing to people. To become No. 1, it offered easy-to-use software that made up for its low firepower by helping millions of people learn the basics of communicating online. Now AOL wants to help its 24 million subscribers accomplish more complex tasks and extend their AOL personal content so it is accessible from TV and portable devices.
Microsoft, by contrast, is a software wizard that has never been good at marketing directly to consumers. It spent vast sums to create its own Web services, some of which are so powerful that only gearheads can figure out how they work. Barely 3 million people subscribe to MSN’s Internet access service, which until recently has done a poor job of unifying Microsoft’s disparate Web sites (Money Central, Expedia, MSNBC.com, Hotmail) into a coherent service. It didn’t help that Microsoft gave the sites different names and did little to promote its MSN brand, which stands for the Microsoft Network.
Now Microsoft executives believe that MSN Explorer--which puts “MSN” at the top of every screen, even on pop-up ads--will help change its image as a clumsy Internet player. The redesigned browser simplifies sign-up and makes the Web easier to navigate by adding icons directly in the browser frame that link to e-mail, chat, money, shopping and other MSN services. With Microsoft’s Internet Explorer browser, users have to know which Web site to visit in order to find those services.
Of course, the prominent new links to Microsoft’s Web services do more than simplify navigation. They also give the company a tighter hold on people as they surf competing Internet sites because the browser frame sits on top of Web pages and allows one-click access back to MSN services. AOL has long done the same thing with its string of colorful icons stripped atop the software frame. MSN Explorer also creates advertising and programming space in the browser frame, allowing ads and news headlines to stay on people’s screens when they leave MSN to surf the Net.
It remains to be seen whether anyone other than newcomers will favor MSN Explorer over the more advanced Internet Explorer. Internet Explorer, which recently got its own minor redesign, was a focus of the antitrust case in which federal prosecutors successfully argued that the Redmond, Wash., software maker had illegally used its Windows monopoly to promote its Internet browser. Although easier to use, the new browser lacks a few basic features, such as the ability to save Web pages. But it adds many useful ones, such as an embedded media player that simplifies the playing of music and movie clips, a customizable menu that lets people choose tool bar links, and an easy way to store Web e-mail offline.
Microsoft says it will market MSN Explorer to nonsubscribers as well, because in the long run the company hopes to convince people that MSN is a content-rich Web service that anyone can use for free. Only the access part costs money. Toward that goal, MSN Explorer works even if people buy their Internet access from other companies, such as small providers in remote areas where Microsoft offers no local phone numbers. MSN.com already is running a banner ad encouraging everyone to download and try MSN Explorer. After its official release in a few months, the streamlined browser will be distributed by partners such as RadioShack Corp., Best Buy Co., Dell Computer Corp. and Compaq Computer Corp.
Company executives say the browser is the first of many initiatives designed to simplify and personalize Microsoft’s Web offerings. It fits into the “Microsoft.net” strategy for shifting Microsoft’s mission away from selling shrink-wrapped software and toward providing Internet-based services. “This is a first step in the direction of creating an interface for Microsoft.net,” said Marketing Vice President Yusuf Mehdi.
AOL, meanwhile, is making changes of its own. A big one is the redesign of its Web portal, AOL.com, to re-brand it “AOL Anywhere” and close off some customized content to nonsubscribers. Subscribers will sign in at the front door for a more customized view of the site. AOL.com has been open to all visitors without requiring registration, even though it is used mostly by AOL subscribers to pick up e-mail from other computers. Increasingly, AOL.com has been shifting its Web portal efforts to Netcenter.com, the site it bought with Netscape last year. The company views AOL.com as a gateway to give AOL subscribers access to their personalized content from cell phones and other devices.
Like MSN’s new Explorer, AOL’s 6.0 software has an embedded multimedia player to make it easier to watch video or play music. AOL is revamping its e-mail software to display images and regular Web pages directly in the message box. The new software also will add a telephone access service that uses voice recognition and will be called AOL by Phone.
But a core difference between AOL’s software development efforts and Microsoft’s is that Microsoft is developing personalization techniques that anyone will be able to use, even someone who doesn’t buy Internet access from MSN. AOL is focused on helping its paying subscribers personalize their content, not anyone else.
The contrasting strategies make sense when you realize that AOL draws nearly three-quarters of its revenue from access fees, a market lead it intends to protect even as Microsoft takes aim with an impressive AOL-like software clone.
