The Fabulous Four

After a wave of consolidation in the Internet sector, a mere four companies--AOL Time Warner, Microsoft Corp., Yahoo Inc. and privately held Napster--now control half of all minutes spent online by U.S. users, according to a report released this week by research firm Jupiter Media Metrix.

In addition, 14 companies controlled 60% of user minutes as of March 2001, down from 40 companies in March 2000 and 110 in March 1999.

Jupiter analysts said the shrinking number of firms that dominate the online world makes it increasingly difficult for newcomers to compete.

“The playing field is anything but even,” said Jupiter analyst Aram Sinnreich. “The Internet may provide an opportunity for new players such as Microsoft or Yahoo to become serious media companies, but so far a major share of the market is being absorbed by a handful of companies.” He added that marketing and advertising prowess, rather than infrastructure, were now the key barriers to entry for nascent Internet firms.