Netscape: Bowed, but not broken

America Online, which has see-sawed over its pricey Netscape acquisition for years, is once again readying the brand for a comeback try, CNET News.com has learned.

The move is a surprise, considering the company laid off hundreds of Netscape programmers less than a year ago and is reported to be developing a standalone browser based on Microsoft's rival Internet Explorer technology.

Even so, sources familiar with the plans said the Time Warner unit is putting the finishing touches on new versions of the Netscape browser and Web portal. The company expects to unveil them with a recharged marketing strategy in December or January.

AOL declined to detail the new Netscape's features, but sources familiar with the company's plans said this browser was a distinct effort from the IE-based release also in the works. AOL also kept mum on details of the portal or the marketing push beyond promising a launch near the New Year.

"Netscape continues to be one of the most valued brands and one of the most valued products on the Internet," said AOL spokesman Andrew Weinstein. "And the Netscape team is working hard to take advantage of those strong attributes to re-energize the brand and its products."

Microsoft's dominant IE browser hasn't enjoyed a significant feature update in years, opening up opportunities for small challengers including Netscape progeny Firefox, Opera Software's Opera and Apple Computer's Safari browser.

Even as a glimmer of competition opens up in the browser market, a weakened Netscape could find itself sidelined after years of abuse at the hands of Microsoft and subsequent neglect after AOL agreed to purchase the company for about $5 billion in 1999.

"It certainly was one of the most powerful brands on the Internet at one point," said Jupiter analyst Michael Gartenberg. "However, that brand has been severely tarnished over the last several years. It's hard to see how they're going to (revitalize the brand) at a time when there's been such a decline in terms of consumers' perception of what Netscape is all about."

Microsoft maintains its stranglehold on the browser market. But the company is beginning to feel momentum for change thanks to mounting dissatisfaction with features and severe security problems with IE. Major computer security groups such as the U.S. Department of Homeland Security's Computer Emergency Readiness Team recently recommended Web surfers switch from Microsoft's browser, although some of that criticism has since been blunted with last month's release of a major IE security update for users of Windows XP.

In an intriguing twist, the major catalyst for competition has come not from commercial browser efforts but rather collectives of open-source programmers. Open-source project licenses let others both use the software at no charge and contribute to its development.

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Although Netscape gave birth to the most important open-source browser group, Mozilla, AOL has yet to capitalize on Mozilla's recent successes. While Mozilla and its Firefox preview releases win raves, AOL continues to use IE as the default browser for its proprietary online service and as the basis for its planned standalone browser. In recent months AOL has barely promoted Netscape 7, which was based on pre-Firefox versions of Mozilla and most recently updated in August.

Even before its full-version 1.0 release--now scheduled for the second week of November--Firefox has exceeded its goal of 1 million downloads in 10 days, surpassed 4.3 million downloads in one month, won plaudits from reviewers, and earned the interest of corporate developers, including Nokia. Scattered metrics suggest the browser might be cutting into Microsoft's still-overwhelming lead.

Even Netscape founder Marc Andreessen, who last year dismissed the state of browser navigation as "an embarrassment," recently weighed in with praise for Firefox, which he said along with open-source based Safari could threaten IE.

One of Andreessen's cohorts from the early Netscape days called that wishful thinking, noting that Microsoft has the resources to defend its browser dominance should a serious threat ever develop.

"I think it is basically a lost cause," said Jon Mittelhauser, one of Mosaic's five original authors and a founding Netscape engineer. "I keep hearing quotes from people like Marc about how these independent little browsers are going to challenge IE since it is stagnating. I wish them all the best, but I don't think they have learned from the past. Microsoft won that war because they can outspend anyone.

"The browser is not advancing because (Microsoft isn't) being challenged. I hope that someone does start to challenge them just to get Microsoft to invest in the browser again, but nobody could ever actually retake the crown. If Microsoft starts to feel some pressure, they will just crank up the spending again and crush whoever it is."

Still, given the stasis that has gripped IE for the past three years, analysts credited Firefox with reawakening AOL's interest in its browser.

"What's interesting is the real center of gravity isn't around the Netscape brand anymore," Jupiter's Gartenberg said. "It's about Firefox. Without a doubt, the Firefox stuff has been one of the most interesting things to happen in the browser space since 1999. They may be very well trying to leverage some of that popularity to popularize the brand."

A long plummet
If Netscape's decline was precipitous, that's because it had so far to fall.

Netscape had its seeds in the Mosaic Web browser created by University of Illinois graduate Andreessen and a small group of others. Unlike the browsers that preceded it, which were used primarily by academics and computer enthusiasts, Mosaic boasted ease of use for people accustomed to the common Windows and Mac graphical user interfaces.

(Andreessen is sometimes falsely credited with inventing the Web browser--that distinction belongs to Web inventor Tim Berners-Lee.)

When Silicon Graphics founder Jim Clark put his fortune and entrepreneurial energy behind Mosaic, Netscape Communications was born.

The start-up's meteoric rise was fueled by rapid adoption of its browser and an apparent lock on a market that could threaten Microsoft's operating system franchise. That rise reached a climax with Netscape's spectacular initial public offering, which began the inflation of the Internet financial bubble and made multimillionaires out of Netscape's investors, founders and employees.

To hear them tell it, those early employees earned every penny.

The first order of business for the start-up was to rewrite the browser from scratch and rename it in order to avoid intellectual property claims by the National Center for Supercomputing Applications, which had sponsored Andreessen and friends' Mosaic efforts.

That rewrite involved the marathon coding sessions and cubicle sleepovers that have become part of Silicon Valley lore. Amid knuckle-crunching stress, chronic sleep deprivation and copious caffeine and sugar abuse, coders credited Andreessen with helping keep up morale as nerves began to fray.

"You need someone like Marc around to overcome the soul-sucking blackness that sets in when you've agreed to impossible goals," programmer Jamie Zawinski wrote in his diary three weeks before the launch. "We've finally announced a public beta to the Net, and there are loads of bugs, and they're hard bugs, sucky, hardware-dependent ones...We're doomed."

When Oct. 13, 1994, rolled around, Netscape released a browser that had been rewritten from the ground up. It would not be the last time.

In terms of its code, the browser that celebrates its 10th birthday on Wednesday bears little or no relation to the browser called Netscape today. That's because once Microsoft caught up to Netscape with IE--based on technology it acquired from Spyglass--Netscape found itself at a marketing and technological disadvantage. Before long, the browser would have to be rewritten a second time.

While Microsoft's antitrust prosecution at the hands of the federal government found the company guilty of abusing its monopoly operating system position to dominate the browser market at Netscape's expense, Netscape insiders credit the company's loss in the browser market to the company's own mistakes both strategic and technical.

"I think there were definitely instances that people could hold up and say, here's where Microsoft was playing unfair," said Netscape founding engineer Chris Houck, now a programmer for Palo Alto, Calif., high-tech start-up LiveOps. "And in each instance you could also make a strong argument that here's where the Netscape guys f***ed up. Given that, it's hard to take a moral stand on that one way or the other."