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The battlefield changes, but the browser war rages on

October 16, 1998
Web posted at 9:50 AM EDT

by James A. Martin

(IDG) -- From the sidelines, the Web browser war between Netscape Communications and Microsoft has been a great show: Constant one-upmanship. Accusations of unfair business practices. Justice Department investigations. It's been enough to make you wonder when Judge Judy was going to step in and straighten everyone out, once and for all.


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But is this long-running drama heading toward an anticlimax?

In recent months, Netscape has focused on "Project Turbo" -- an initiative designed to build traffic at Netcenter, the Web portal it revamped last summer in hopes of better competing with Yahoo, Excite, and other sites vying to be a user's all-important first stop on the Web.

On Wednesday, for instance, Netscape announced it would extend Netcenter content and services into local markets worldwide and that Netcenter will leverage Netscape Communicator 4.5's Smart Browsing feature. (Smart Browsing, which promises quick and easy searching using common words rather than URLs, is also available to Microsoft Internet Explorer 4 users via a free, downloadable utility called TuneUp for IE.)

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This flurry of Netcenter announcements comes at a time when a recent report from International Data Corporation found Microsoft's browser had moved ahead of Communicator in market share for the first time. According to IDC, Netscape's market share slipped to 41.5 percent in June, while the combined market share for IE and America Online (whose users get IE automatically) rose to 43.8 percent. And Microsoft has enlisted droves of developers to work with its upcoming IE 5.

So Netscape, realizing that constantly competing against Microsoft in the Web browser arena is a losing proposition, is shifting its priorities to Netcenter and its corporate software business.

"Because they give it away for free, the Web browser doesn't represent revenue for Netscape," said Jim Balderston, an industry analyst at Zona Research in Redwood City, California. "Netcenter does generate revenue, so it makes sense to put a lot of energy into Netcenter, then make sure that Microsoft's browser, as well as their own, can take full advantage of it."

But Netscape isn't about to discontinue its browser, as Joan-Carol Brigham, research manager for IDC, pointed out. Communicator will continue to play an important role in helping Netscape push further into e-commerce and corporate software, Brigham said. "Netscape may not be emphasizing Communicator development as much as it once did," she added. "But still, it's important to keep it working well and to make it even easier to use, as a way to achieve their other business objectives. The browser is, after all, a portal to the Web portals."

So the browser soap opera may be in a slow fade, but the drama continues on a different set. Netscape raises the curtain soon on the next scene: Communicator 4.5, due any day now. The next big act--Communicator 5.0--is on target to be available in beta by year's end, with final product available by next spring.

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