Netscape scores e-commerce deal

Forget the courtroom.

Netscape Communications' true battlefield with software titan Microsoft is in the boardroom persuading corporate clients it is in the market for the long haul, experts say.

At least one new customer is willing to take that bet. Mountain View, California-based Netscape announced today that Ford Motor subsidiary Visteon has licensed Netscape's line of e-commerce software.

It is a similar deal to one Netscape made in May with Citibank.

Visteon is a $17 billion a year maker of small parts for the automotive industry. The Dearborn, Michigan-based company is using Netscape's line of e-commerce products to set up a supply chain ordering system, using the Internet as a type of electronic data interchange pipeline to reach all of its customers and suppliers.

"Visteon was traditionally more purchasing oriented, a sort of hub of purchasing," said Steve Savignano, Netscape's vice president of application products. "They used to be able to dictate inventory turns to other suppliers. Now, they find they are being a supplier."

But Visteon had built most of its infrastructure around being on the consumer end, not the supplier end of the supply chain spectrum. So the firm is turning to Netscape to switch the flow in the other direction.

For Netscape, the deal means survival since such large scale deals are vital to its continued existence, as the company recently told investors and government officials in its Securities and Exchange Commission filings.

In particular, Netscape said that "if Netscape lost, deferred, or failed to consummate one or more such large product or Netcenter licensing transactions, Netscape's results of operations could be materially adversely affected in future periods." For the previous quarter that deal was with Citibank which accounted for "greater than 10 percent of total revenues for the three months ended April 30," the report stated.

While Netscape would not release financial details, Savignano said the Visteon deal was on par with the Citibank agreement.

Netscape is betting such deals will lead to more agreements. The idea is that once you penetrate one player in a complex supply chain, others will buy into the concept and purchase their own licenses.

Other markets Netscape is hoping to penetrate include retail, discreet manufacturing, and makers of durable and nondurable goods, all industries that have built complex supply webs over the years to better compete in their market places.

"Anywhere you have a complex supply chain relationship with some sort of online buying and selling, you will see a shift toward these kinds of system," Savignano said. "Up until now, the dominant topics of online purchasing have been consumer based, like buying books over the Internet. But all along we have been concentrating on business-to-business systems."