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Lotus IE deal pressures Netscape

Analysts say that Lotus may be trying to persuade Netscape to unbundle its Navigator browser from the Communicator package.

Lotus Development's pledge to cozy up to Microsoft (MSFT) and its Internet Explorer 4.0 Web browser may be intended to persuade Netscape Communications (NSCP) to unbundle its Navigator Web browser from its Communicator package, analysts say.

The IBM subsidiary today said it will bundle IE 4.0, when it ships, as part of its SmartSuite desktop application package and Notes 4.6 client package. Lotus also said it is planning to deliver "extremely tight integration" between IE 4.0 and an upcoming release of Notes.

While the continued bundling support is no surprise--Lotus has shipped version 3.0 of IE with these products since the beginning of the year--the integration pledge may be intended to prod Netscape into resolving packaging issues with its Communicator software.

Lotus had shipped Navigator with its client software packages but stopped bundling the software several months ago, a company representative said. Lotus would consider bundling Navigator again if Netscape unbundles Navigator, according to the representative.

However, Netscape has said it has no intention of breaking up the Communicator bundle. Analysts say Netscape most likely will not rethink its decision, despite the fact that it sometimes puts the company in a poor competitive position vs. Microsoft.

"To continue to remain competitive, it may be worthwhile to break out Navigator," said Heather Ashton, an analyst at the Hurwitz Group.

But Netscape's aggressive moves onto Lotus's groupware turf in recent months with Communicator, which includes competing groupware features, means that future bundling deals between the two companies are doubtful, analysts say. Communicator includes group conferencing and discussion group software, in addition to Navigator and an email and news reader.

"Lotus sees that it needed to choose Microsoft over Netscape, because Communicator is aimed directly at them," said Ashton. "This is just Lotus protecting its turf."