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Browser war ain't over till it's over

Despite the fervor surrounding Microsoft's launch of Internet Explorer 3.0, most analysts aren't ready to eulogize Netscape's Navigator in the browser world.

Even before releasing the final version of Internet Explorer 3.0, Microsoft had already made headway on several fronts against Netscape Communications, owner of the dominant browser on the Web. But despite the fervor attendant to this week's launch, most analysts aren't ready to eulogize Navigator.

That doesn't mean that Netscape isn't on the defensive; the company is clearly scrambling to match Microsoft's marketing moves in the same way that Microsoft spent much of this year matching Navigator's technology. Navigator's most pressing challenge is to assemble by Monday its own partnerships with Web content providers as part of its Navigator 3.0 launch.

In its own Monday night launch, Microsoft announced a content giveaway worth several hundred dollars through deals with Web publishers such as the Wall Street Journal.

With the latest versions of both browsers just out of the gate, it's too early to call the race. But some industry handicappers are already laying down the odds.

According to most analysts familiar with the browser market, what's clear is that Netscape's hammerlock on the browser market has been broken. The company will almost certainly lose the overwhelming dominance that it has enjoyed until the past several weeks, when beta versions of Explorer 3.0 began cutting into its lead. But most analysts also expect the browser fight to be a draw, with Microsoft and Netscape splitting the market, rather than a winner-take-all scenario.

But with Microsoft in the unlikely role of underdog, Netscape is left with the most to lose. And it is already losing.

Navigator's market share, which ran as high as 84 percent in a Dataquest study from April, is diminishing. Dataquest hasn't updated its numbers since then, but a number of Web sites that track browser statistics on their own pages, including newsletter BrowserWatch, the InterNect Financial Database, and Interse, indicate that Internet Explorer usage has risen considerably this summer.

On average, the sites show that Explorer has gone from a 7 percent market share four months ago to around 15 percent in July, before the release of the final version 3.0.

"It's going to be impossible for [Netscape] to hold on to that 80 percent share," said Ted Julian, research manager for Internet commerce at market research firm International Data Corporation. Julian predicts that Microsoft won't erode Navigator's dominance in any significant way until it incorporates its browser directly into Windows early next year.

Clearly, however, Microsoft doesn't want to wait until then to wound Netscape. Last night, Microsoft struck a series of alliances with content providers and developers in an effort to make Internet Explorer and its related ActiveX architecture the "preferred" browser on Web sites.

The deals encompass a promotional offer that will give Internet Explorer users free access to Web sites--such as ESPNET SportsZone and the Wall Street Journal Interactive Edition--that normally charge for access. Similarly, Microsoft is hoping to woo developers into "activating" Web sites by embedding multimedia widgets in their pages, features that only users of Internet Explorer 3.0 for Windows will be able to view.

By optimizing their sites for Internet Explorer, many Web publishers, including CNET, hope to realize technological benefits, as well as promotional benefits by standing close to Microsoft's marketing megaphone.

"In addition to the benefits of the technology, we get a lot of promotion on their site," said Stuart Halperin, executive vice president and cofounder of Hollywood Online, which has added ActiveX controls to its Web site. "The combination of great technology and the alliance makes it a great deal."

Although many Web sites have already used Java to add animation and other programs to Web pages, ActiveX allows developers to work with more familiar, mature development tools, said one developer that has worked with both technologies. ActiveX controls can work with the Windows 95 version of Navigator through a plug-in from NCompass Labs, though Microsoft officials claim that Internet Explorer's "native" ActiveX support is better.

"With ActiveX we were able to take advantage of developers knowledge of Visual Basic and OLE [Object Linking and Embedding] automation," said Richard Lamb, chief operating office of Interactive Imaginations, which is offering free access to games for Internet Explorer users. "The turnaround time is most attractive to us."

Netscape is far from conceding defeat to Microsoft, however. The company is also preparing its own alliances with content providers on Monday that will deliver personalized information feeds to users over email and Usenet discussion groups. The company is also continuing to add innovations such as groupware capabilities to its browser that observers say could halt the advance of Internet Explorer, particularly among corporations.

"This is one part technical battle and one part marketing battle," said Timothy Sloane, director of electronic messaging, at the Aberdeen Group. "I don't believe we've seen the end of Netscape here. It's Microsoft's time in the sun right now."

That time in the sun was highlighted by announcements from literally dozens of software vendors, including several key players:
--MCI Telecommunications announced today that it will provide customer support through its call centers for users of Microsoft's browser. The company will also package Internet Explorer 3.0 with the access software for its Net subscribers and will offer subscribers 20 free hours of service for the first month.
--Users of Internet Explorer 3.0 also can get VeriSign Digital IDs, a sort of driver's license for cyberspace so Web servers can authenticate a user's identity. As a promotion, Internet Explorer users can get a Class 1 Digital ID, a $6 value, for free. A similar capability has been included in beta copies of Navigator 3.0 that is expected to ship next week.
--Microsoft is bundling ActiveX controls from a number of vendors with Internet Explorer, including Progressive Networks' RealAudio, Macromedia's ShockWave, FutureTense's Texture, and Narrative Communications' Enliven Viewer.

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