From...

Andreessen

December 4, 1998
Web posted at: 10:00 AM EST

by Elinor Mills

SAN FRANCISCO (IDG) -- Once Netscape Communications employees can get past the image of America Online as a service for unsavvy computer users they will see how Netscape products can benefit from the online giant's marketing expertise, Netscape cofounder Marc Andreessen said Wednesday during a talk at the Business Week conference on The Digital Economy.

"There's this perception of AOL as a sort of middlebrow [company] for people who don't know any better," said Andreessen, who is executive vice president of Netscape. But "AOL is brilliant at marketing," he said. "I'm hoping we can learn a lot from that."

Everyone at Netscape agrees that "it's a really big deal to be number one, on a winning team," he said. They also agree that it's important for the company to have a clear vision and strategy, and they recognize the importance of brand loyalty. Netscape can get all of these things with AOL, he said.

"A lot of Silicon Valley companies don't think about marketing much," Andreessen said. "The folks at AOL come from a different position in thinking about marketing. The first thing on their mind is the brand."

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AOL will likely preserve the Netscape brand, possibly taking it and "going into distinct markets, and allowing individual brands under the umbrella" of AOL, he said, citing as an example AOL's purchase of the ICQ instant messaging technology from Mirabilis in Israel. "So far I think they have a really good track record over the last few years in allowing these things to succeed in their own way."

Readying Internet appliances

In addition to lending Netscape its marketing know-how and strength in the increasingly competitive Internet market, AOL, along with partner Sun Microsystems, will help the company in the Internet appliance market, according to Andreessen.

"We think this is one of the things we're going to gain from this deal," he said. "The traditional software business model is not going to work on a large scale for anyone" in the Internet device market, because there's not enough room in pricing to "extract a lot of money for software."

Netscape had no economic incentive to build software to run on these devices, he said. But in AOL's environment of aggregated services, "it makes sense to open up this service to as many of these devices as possible. The key is that the business model behind that is service based."

Andreessen had fun discussing the cultural aspects that Netscape workers fear will go by the wayside under the new parent company. Despite concerns ranging from whether Netscape e-mail addresses will be replaced by the less glamorous aol.com to whether employees will still be able to bring their dogs to work, things at the smaller and hipper Netscape don't have to change much, according to Andreessen.

He added that it's unclear what his role will be in moving the company forward, but he wants to play a part in helping AOL "take a leadership position on the Net."