Tech Industry

Halfway home on '98 forecast

"Surprisingly good" is the verdict on my late 1997 prognostication of what 1998 would bring to Internet commerce. Quite a few predictions were right, a handful dead wrong, and for the rest, the year's still young enough to recover.

"Surprisingly good" is the verdict on my late 1997 prognostication of what 1998 would bring to Internet commerce. Quite a few predictions were right, a handful dead wrong, and for the rest, the year's still young enough to recover.

But let's first talk about several trends we missed: "Portal" became the detestable buzzword of choice. Yahoo's purchase of ViaWeb to host Web storefronts will have a major impact, as could GeoCities' effort to let merchants set up storefronts in its virtual neighborhoods. Online auctions are taking hold not just among consumers, but businesses too, though business auctions are less visible because they're on extranets.

Now let's go to the predictions, scored overall as 17 right, 7 wrong, and 12 undecided:

  • Microsoft: Still "addicted to hardball tactics," Microsoft did anger the federal judiciary but is faring better in court than anticipated. Windows 98 was not delayed (wrong prediction) and Internet Explorer continues to eat away Netscape's browser market share (right). The jury remains out on Microsoft's efforts to torpedo Java. Also unclear: Will bankers' complaints scuttle MSFDC, the venture to let consumers view, then pay bills online? Score: 2 right, 1 wrong, 3 undecided.

  • ISP/telco: As predicted, AT&T got into the acquisition business with its pending bid for cable giant TCI, and Sprint bought 30 percent of ISP EarthLink Network Sprint, linking their Net operations. Two former Baby Bells are merging, SBC and Ameritech. But ISP Verio opted for an IPO rather than selling to a telco. Score: 3 right, 1 wrong.

  • Security: Yes, merger mania is the main game in network security, and firewall firms were popular purchases. Trusted Information Systems sold to Network Associates, which also added Secure Networks to its security stable. Though virtual private networks (VPNs) are topical, they have produced no acquisitions. As network and security management converge, Cisco continued its security play in buying intrusion detection firm WheelGroup, while security firm Check Point bought IP networker MetaInfo. So far, 3Com is still sitting out the security dance. Score: 3 right, 3 wrong.

  • Intrusion detection: As predicted, this is where the action is in Internet security. Internet Security Systems went public, WheelGroup sold to Cisco, Security Dynamics acquired Intrusion Detection, and Network Associates bought Haystack Lab's technology. Network Associates just sued ISS over patents, so this market is now mainstream. Score: 1 right.

  • Online billing: Indeed, the buzz over bill presentment (posting bills on Web sites) grew louder, but it's still among inside players, not bill payers. Score: 1 right.

  • Subscriptions: Few publishers are charging for content, though many would like to. Microsoft's Slate e-zine finally did the subscription thing, but Cowles New Media's Media Daily news service tried, then backed off. Score: 1 right.