The networking equipment giant finalized its acquisition of customer relationship management (CRM) software maker Clarify earlier this month. Nortel's new division, Clarify eBusiness Applications Unit, will focus on providing e-commerce applications and services that enable companies to manage customer data online and build trading exchanges linking them to their partners and suppliers over the Internet. Clarify's software products allow a customer service agent, for example, to examine sales and service information online.
Nortel's new unit is focusing on two fast-growing market segments: business-to-business e-commerce and CRM software.
Leading research firms have projected the business-to-business market to grow to between $2.7 trillion and $7.3 trillion by 2004, from about $131 billion last year. CRM software, a market led by Siebel Systems, has garnered attention from all the big software makers, including Oracle, SAP and PeopleSoft. The market is expected to reach $11 billion by 2003 from $1.9 billion in 1998, according to research firm International Data Corp.
In recent weeks, competition has heightened in the e-commerce world as more and more businesses begin to move their supply chains online in an effort to reduce internal purchasing costs. A wide range of companies, including IBM, Yahoo, eBay and Alta Vista, have joined the business-to-business scramble.
Nortel's new unit is a combination of several resources: its own Internet and contact center capabilities; Clarify's customer relationship software; and its August 1999 acquisition of Periphonics, a maker of customer self-service software. Nortel said the new division has also inked a partnership with Big Five consulting firm Andersen Consulting to help companies implement the new products.
The first set of products from the new unit will include Nortel's wireless service, which will give companies access to customer and inventory information and other business applications from a handheld device. It will also include Clarify's full suite of front office software combined with Nortel's Web response servers and contact centers, as well as connection and Internet security management.
Based in San Jose, Calif., the new division said it has about 2,600 employees and serves customers such as Best Buy, Charles Schwab, General Electric, H&R Block and Qwest Communications International. Nortel said it plans to release a series of partnerships, new products and customers supporting its new strategy throughout the year.
U.S. District Judge Thomas Penfield Jackson, who set today as a deadline for his decision in the landmark Microsoft antitrust trial, will postpone his decision, according to a court liaison.
Judge Jackson was expected to rule today, but reports late yesterday indicated he might postpone action for at least a day and possibly for as many as 10 days. "There will be no ruling today," said press liaison Joe Alexander at the U.S. District Court for the District of Columbia.
Microsoft shares rose $2.18, or 2 percent, to $106.25 this morning and were among the most actively traded on Nasdaq.
The software giant's fate now hangs on the skills of two judges: the one presiding over the trial and the court-appointed mediator.
Legal and industry experts warn it is nearly impossible to determine whether a settlement in the trial will be reached before a ruling, which would likely lead to a government request to break up Microsoft.
Government lawyers yesterday continued to pore over an eleventh-hour settlement proposal Microsoft made last week, working with the mediating judge, Richard Posner.
Posner, head of the U.S. Court of Appeals for the 7th Circuit in Chicago, is a highly respected jurist who is believed to be capable of brokering a deal.
"If anyone can make a deal happen, Posner can," said Rich Gray, an intellectual property attorney with Outside General Counsel Silicon Valley in Menlo Park, Calif.
Microsoft's settlement proposal, which offered major concessions including uniform Windows pricing and opening part of the source code, apparently signaled to Jackson that Microsoft is seriously attempting to settle the case. The software maker apparently extended the terms of the proposal to its Windows 2000 operating system, the company's most important product line.
Still, the progress of settlement talks is very difficult to gauge and can change literally by the hour, warned Gray.
"The point is, nobody knows what's going to happen," he said.
Yesterday, the possibility that a federal judge might rule in the antitrust case pulled down the software maker's stock $7.62, nearly 7 percent, closing at $104.62. Settlement rumors last week lifted Microsoft's stock nearly $10.
"Pretty much anything is on the table from Microsoft's perspective," said Gartner Group analyst Michael Gartenberg. "The only stumbling point would be restricting (Microsoft's) freedom to integrate future features into its operating system. They don't want to be locked out of" developing future products, he said.
Partly because Microsoft is so pervasive and partly because of its influence over the computing industry, any settlement offer by the company is going to come with a Pandora's Box of unexpected effects and unforeseen consequences. The current case, after all, results from the fact that a clause in a 1994 agreement allowed Microsoft to integrate Internet Explorer into the Windows operating system.
The possible spoiler to negotiations is growing dissension among the 19 states, say sources familiar with the negotiations. Attorneys general for Connecticut, New York and Wisconsin--the states with the most influence over negotiations--may no longer be united on what to do about Microsoft.
Dissension among the states is nothing new, but a split among the three leaders--with one another or with the Justice Department--could greatly compromise the negotiations, warn legal experts.
An ongoing series of leaks about negotiations indicate the problems are serious and more than just issues with Microsoft's proposal.
"The leaks are not a good sign because it indicates these folks have come to some kind of impasse," Gartenberg said. "Let's face it, they've been at an impasse for two years."
Connecticut Attorney General Richard Blumenthal has been a vocal advocate for punishing Microsoft harshly and appropriately for its behavior. But in recent weeks, the Justice Department has shown more willingness to accept a conduct remedy rather than one compelling a Microsoft breakup. Kevin O'Connor, Wisconsin's assistant attorney general, is rumored to be willing to accept an "appropriate" conduct remedy rather than a breakup of the software giant.
Microsoft has "got to come up with something the DOJ can live with, the judge can live with, and all the states have got to live with. That's a pretty big mix of folks to agree on something that never in the past have been able to do that," said Gartenberg.
Deutsche Bank, the world's largest bank in terms of assets, today said it will take a 14.6 percent stake in National Discount Brokers and also form an e-commerce alliance with the Internet brokerage.
With its $135.9 million investment in NDB, Deutsche Bank said it is expanding into online brokering, a sector increasingly pitting Internet start-ups such as E*Trade, Ameritrade Holding and Datek Online against full-service investment houses such as Morgan Stanley Dean Witter, Merrill Lynch and PaineWebber.
While some of the powerful full-service firms have created online brokerages from the ground up by acquiring trading technologies with little retail presence, Deutsche Bank is taking the partnership approach by teaming with an established online player. Investment bank U.S. Bancorp Piper Jaffray ranked NDB as the 12th largest online brokerage--well behind No.1 and No. 2 firms Charles Schwab and E*Trade.
Dutch bank ABN Amro today also announced a similar deal. The bank formed an alliance with Trade.com, investing $62.5 million for a 25 percent stake in the Internet brokerage's parent company, BlueStone Capital Partners.
The deal will allow the Dutch bank to use Trade.com's technical infrastructure to provide its own ABN Amro-branded online brokerage services in markets around the world by the end of this year, the bank said.
The differing strategies are understandable since full-service firms such as Merrill Lynch and Morgan Stanley already have strong retail presences offline, allowing them to build Internet brokerages under their own brands.
"Deutsche doesn't have a meaningful retail presence in the U.S.," said Chris Musto, director of financial services at Gomez Advisors. Musto noted that Deutsche Bank does have some retail outlets through the acquisition of investment firm BT Alex Brown. "But this is a relatively small network. It is very lucrative, but it is not a cure-all to the challenge of Internet retail brokerage."
These banks are paying for what they need most: a trading platform with some brand-name recognition.
Deutsche Bank and NDB plan to create a jointly owned online brokerage service outside of the United States. The alliance also provides NDB with access to Deutsche Bank's U.S. equity research and initial public offering capabilities. In return, Deutsche Bank can provide its service internationally over NDB's trading technology platform.
"This alliance supports Deutsche Bank's e-commerce strategy of global connectivity, linking markets and investors around the world," said Michael Philipp, head of global equities at Deutsche Bank. "It's a major stepping stone to reach online customers without having to rely on bricks and mortar."
Deutsche Bank, which already had a 1.7 percent stake in NDB, will control 16.3 percent of the online brokerage. The bank may purchase another 3 million shares from NDB on the open market.
The companies expect a definitive agreement to be signed during the second calendar quarter of 2000.
Yahoo today announced it is teaming with Jim Clark's Shutterfly to launch a new site that will let people store and view digital photos on its popular service.
As previously reported, the site, called Yahoo Photos, allows consumers to upload, store, share and develop photos through its service. It also lets people create photo albums that can be viewed publicly or by a predetermined group.
Shutterfly is a service that turns digital images into actual photo prints and then mails them to customers. As part of the launch, Yahoo and Shutterfly will offer people up to 15 free prints.
With the addition of photo publishing and photo albums, Yahoo is stepping into a market that has attracted the attention of several Net heavyweights.
In October last year, America Online formally launched You've Got Pictures, an online photo service created with Eastman Kodak. Later that month, Netscape Communications founder Clark launched Shutterfly to offer enhanced digital printing services over the Web. Hewlett-Packard also has an online photo album service, Cartogra, that allows friends and family to share pictures over the Web.
Another online photo start-up is Snapfish.com, which said it would offer free photo processing and prints in a January launch. But the service has not launched yet, according to the order form on its site. eMemories, an eCompanies start-up, also processes film and then scans and uploads the images onto the Web.
PhotoAccess.com is another site similar to Shutterfly that went live in December.
The budding of online photo sites is in response to the expected rise in popularity and sales of digital cameras. According to research firm International Data Corp., digital camera use is set to take off, growing from sales of about 4.7 million units this year to 22 million units by 2003.
Yahoo Photos ties together other Yahoo sites, including home page publisher GeoCities, message boards and clubs--features likely aimed at boosting community offerings to keep customers on the site longer. The site also includes links to Yahoo's shopping, auctions and classifieds pages, where people can search for digital cameras and other photography hardware.
In addition, the Web site includes a searchable picture gallery that people can surf to find photos to illustrate home pages, greeting cards, auction pages and so on.
Yahoo's move into online photos makes sense, according to Jupiter Communications analyst Aram Sinnreich. The company has focused heavily on owning or operating services that foster recurring usage. Services such as clubs, home pages and photos give people more personal space for posting their own content.
But cultivating customer loyalty with an online photo service remains untried in a business that has yet to cause a stir among consumers.
"It is a stretch," Sinnreich said. "Nobody's figured out the magic formula yet to cause a sea change in consumer behavior." IEPER, Belgium--Lernout & Hauspie Speech Products agreed to buy Dragon Systems, its leading U.S. competitor, for about $593 million in stock to form the biggest maker of speech recognition software for consumers.
The Belgian company will pay about 5.45 million of its shares, which closed yesterday on Nasdaq at $108.75. Both Lernout and privately held Dragon are makers of speech recognition software. Lernout's shares rose as much as 18 percent in European trading.
"It's a very good move--Dragon was a pioneer in speech technology," said Johan van Geeteruyen, who manages about 100 million euros ($96 million) in Belgian stocks at Petercam in Brussels. The takeover will prevent Lernout's competitors, which include IBM and Royal Philips Electronics, from buying Dragon, he said.
Demand for electronic speech recognition is exploding, Lernout said, partly because of the growing use of mobile phones to access the Internet. The acquisition allows it to combine the best technologies and research efforts of both companies to produce systems that are increasingly effective and easy to use.
The current markets for voice recognition on personal computers and for telephone software total more than $2 billion per year, Lernout said. The company gained access to the $6 billion business of transcribing medical reports earlier this month when it agreed to buy Dictaphone for about $936 million.
Newton, Mass.-based Dragon will add 35 patents and 170 scientists and engineers to Lernout's 1,400 research and development staff. Dragon also was ahead in developing speech recognition for Italian, Spanish and Japanese, and the acquisition will boost Lernout's sales in these markets, the company said.
"There are not enough talented, experienced people in this field; today we can safely say that we have most of them with us," said Jozef Lernout, one of the company's founders and chairmen. "With the acquisition, we will definitely be No. 1 in number of customers, number of dollars generated, and number of scientists and engineers."
Lernout will use about 8 percent of its total market value to acquire Dragon, chief financial officer Carl Dammekens said in a statement. The shares rose as much as 19.5 euros ($18.81) to 129 euros ($124.45) and recently traded at 127 euros ($122.52) on Easdaq.
The worldwide use of mobile phones is expected to increase to more than 500 million devices in five years, and most of them will be "a combination of phone and pocket computer," Lernout said. The company's software would allow the devices to find text information on the Net and then read out summaries of that information, he said.
"Mobile phones are such tiny little things, it's difficult to enter text through their keyboard. Speech recognition technology will be a way to do that," said Petercam's van Geeteruyen, who plans to hold the Lernout shares he bought about a month ago.
Lernout recently demonstrated a prototype handheld device with a dictation system to send and receive email, surf the Web, and conduct online commerce. It's in talks to form alliances with device manufacturers toward producing the first such devices by the end of the year, although it's too early to give details, said Pol Hauspie, the other founder and chairman.
Dragon also was working on software for mobile devices, and its engineers should help speed up and improve development of the new device, Lernout said.
Lernout also plans to offer complementary products to Dragon's customers, which include major companies such as Boeing, Citibank and Dell Computer.
Dragon reported a loss of about $22 million in 1999, down from a profit of $10.3 million in 1998. Revenue fell to $60 million in 1999 from about $71.4 million. The company announced plans for an initial share sale in December 1998, but dropped the plan last April.
Dragon has focused on one market--software for dictation--while Lernout & Hauspie developed software for producing speech and for a variety of markets, the company said.
As a "one-stop shopping place," the Belgian company was able to win some contracts away from Dragon, Lernout said.
"Dragon was head-on in competing with us and other companies," he said. "Our philosophy is to spread risk and be involved in everything that has to do with linguistics."
The U.S. company designed its NaturallySpeaking dictation software to run on Microsoft's Windows operating system, which is developing speech recognition software of its own. In October, Microsoft bought Entropic, a Washington-based speech recognition software company, for an undisclosed price.
Microsoft has invested $60 million in Lernout & Hauspie, and the companies cooperate on some products and compete on others, Hauspie said.
Copyright 2000, Bloomberg L.P. All Rights Reserved. Akamai Technologies and CacheFlow, two companies devoted to speeding the transfer of information over the Internet, are teaming up.
Both companies sell caching technology that speeds Internet access by stashing information closer to the users who need it. CacheFlow sells servers that accomplish this; Akamai sells caching services to customers who don't want to set up servers themselves.
Under a deal announced today, Akamai will tie together the companies' caching technologies, and the firms will jointly develop products. In addition, CacheFlow will sell Akamai's FreeFlow caching service, the companies said.
The deal highlights the increasing number of alliances being struck as companies strive to avoid sluggish or even embarrassingly inaccessible Web sites due to heavy traffic. Companies across the high-tech landscape--including computer makers, network equipment makers, Web site hosting firms and telecommunications firms--are forming partnerships to make sure information is delivered quickly.
The deal won't likely be welcome news at VA Linux Systems, which builds Linux computers that Akamai buys, even though CacheFlow and VA servers aren't used for the same purpose in a network. Akamai is VA's biggest customer, according to VA's Securities and Exchange Commission filing. Though VA's customer base is broadening, Akamai accounted for 12 percent of VA's revenue in the last six months, the only company that exceeded 10 percent, VA said.
Though Akamai is a strong partner, CacheFlow can't afford to relax. Its special-purpose "server appliances" also face competition from computer giants such as Dell, Compaq and IBM, as well as smaller companies such as Cobalt Networks and Network Appliance. That competition led Merrill Lynch analyst Steve Milunovich to predict Cobalt will have to increase marketing efforts and thereby delay profitability three months.
Under the deal, CacheFlow will incorporate software from Akamai to automate the process of distributing information to caching servers, the companies said. Though the agreement doesn't involve any purchases of CacheFlow servers, the ideal location for them in an Akamai-augmented network would be between the Akamai servers and the originating Web site.
Marc Andreessen, a founder of the famed Netscape Communications, is a CacheFlow board member and investor. He said he backed the company because he believes there is a transition taking place, from the older model where high-speed "routers" transferrer Internet traffic as fast as possible, to the newer caching technology. The transition is "from moving bits to intelligently managing where they are," he said in an interview.
Akamai has more than 2,000 servers in 40 countries to speed data transfer, the company said.
Akamai also faces numerous competitors, including Inktomi, Digital Island and Mirror Image.
Hewlett-Packard has invested in Xcelera, Mirror Image's parent company. Inktomi has partnerships with Sun Microsystems and Intel to build server appliances with its caching software. And Sun and Inktomi have invested in Digital Island.
Terms of the deal between Akamai and CacheFlow weren't disclosed.
Linux, a low-cost sibling to the Unix operating system, is popular in some caching servers--it's used in those from Cobalt, for example. But Linux faces competition from a new version of "embedded" Windows 2000 for special-purpose servers that will be used by Dell and IBM.
eBay is closing some member accounts and calling in federal officials after receiving more than 150 complaints about fraudulent auctions, CNET News.com has learned.
The alleged scam artists built up their reputations over time at the site, where buyers and sellers rank each others' reliability, eBay and those involved in the case said. Then they defrauded buyers on several electronic equipment auctions all at once earlier this month, according to the complaints.
eBay said it has contacted the U.S. Postal Service, which investigates mail fraud, and the Los Angeles Police Department in Van Nuys, Calif., where the alleged perpetrators are believed to have based their operations. Los Angeles police confirmed that they are investigating.
Some eBay buyers who lodged complaints said they paid for items but either didn't get anything or received something other than what they had ordered.
Meng Yang said he paid $931 for a laptop computer around March 11 but never got it despite paying for second-day shipping from Federal Express. Jennifer Williams said she received a Macintosh game controller from the same seller instead of the Palm IIIc she thought she had bought for $390.
"When things like this happen, you don't know what to do," said Williams, of Fresno, Calif. "You feel so helpless."
The case is the latest in a string of fraud-related complaints to shake the leading auction site.
Late last year, a Southern California man was sentenced to 14 months in prison for defrauding eBay users of more than $36,000. Also last year, eBay suffered a rash of spoof or illegal auctions, including 500 pounds of marijuana, a human liver and an unborn baby.
Last spring, eBay reached a settlement with New York City's consumer protection agency, which was investigating complaints about fake sports collectors' items on the site. As part of the settlement, eBay agreed to put in place a series of anti-fraud measures, including attempting to verify the identities of frequent sellers on eBay and offering third-party mediation to sort out disputes between buyers and sellers.
Yang, of Portland, Ore., said he contacted other eBay members who had bid on auctions offered by the same seller. He added that many said they didn't get the items they bought.
eBay's fraud protection includes a feedback system that allows buyers and sellers to praise or criticize how they handled their transactions. But eBay spokesman Kevin Pursglove confirmed that some of the positive feedback seemed to be fraudulent in this case.
"There were a couple cases of shill feedback," he said. "That's cause for immediate suspension from eBay."
Yang said he reported the problems to eBay, the FBI and the Los Angeles Police Department.
eBay members can file an insurance claim for up to $175 with the auction giant, which is backed by Lloyd's of London.
As online auctions have grown in popularity and sales, so too have allegations of auction fraud. Consumers filed some 11,000 complaints about Internet auctions with the Federal Trade Commission last year, up from 107 in 1997.
Latin America is getting hip to the business-to-business craze.
Mercantil.com, an online marketplace for companies operating in Argentina, Brazil, Chile and Mexico, launched a site today to tap the growing and lucrative industry for business-to-business transactions. Through the site, companies can find a directory of Latin American businesses in technology, transportation, mining, construction, health and retail, among other industries.
The site launch follows a similar effort earlier this year by Commerce One and Banacci, a financial group based in Mexico. The joint venture will link buyers and sellers throughout Latin America and companies around the world.
Earlier this month, Microsoft chairman Bill Gates said that Latin America is one of the world's most promising markets, second only to Asia in e-commerce spending. Gates predicted that spending on Web commerce would reach nearly $11 billion annually by 2003, driven by Latin America's almost 30 million users by the same year.
Backed by BancBoston Capital, which owns 22 percent of the company, Mercantil.com said it has more than 1 million companies in its database and plans to expand to eight additional Latin markets by the end of 2000.
"Mercantil.com is leveling the playing field for players worldwide by providing them with easy entry to Latin American markets--just a click away," said James Brierly, founder of Mercantil.com.
Mercantil.com also connects buyers and sellers with such information as Latin America's customs regulations, banking practices and financial news. The company was co-founded in 1999 by James Brierly, creator of Chile's first online database and Jaime Vargas, founder of Chilean investment group Incorp. SALT LAKE CITY--Network software maker Novell's ongoing struggle in the market proves old battles can leave lasting scars.
In a move to heal the damage from a series of fiscal problems and executive shuffles, Novell today unveiled a new strategy to focus on the nascent market for Internet-based services.
At the company's annual BrainShare user conference here, Novell showcased products that will fall under its so-called directory-enabled Net infrastructure model, or "Denim." With the new plan, executives say the company has moved from being a competitor of software giant Microsoft to a pioneer in the Net-based services market.
Previously reliant on sales of its Netware server-based operating system, Novell is now restructuring its focus to showcase its directory services software. Such software essentially serves as a "phone book" for networked computer users, systems, software and attached devices.
This new focus could re-establish the company as an integral software provider for the Net, if it succeeds in implementing its new strategy effectively, analysts say.
Skeptics wonder whether Novell can articulate a hard-to-understand batch of technology as a panacea for what has become a disorganized web of networks and information. As has been the case throughout Novell's history, the answer lies in two classic weak spots: marketing and execution.
"I think Novell is saying all the right things," said Jamie Lewis, chief executive for the Burton Group, an industry consulting firm. "My question (is) how they're going to deliver. What's behind the message now?"
Market figures show why Novell needs to make the switch. Microsoft's Windows NT captured 38 percent of the server-based operating system software market in 1999, with Linux in second place at 25 percent. NetWare was relegated to third place with 19 percent, according to market researcher International Data Corp. (IDC). Various Unix entrants placed fourth with 15 percent of the market.
Historically, Novell was a leader in the server operating system market, but the company's chief executive, Eric Schmidt, says that focus is now "last year's story."
Saying his company is taking the "next step" after restoring customer confidence and building new technology that people want to buy, Schmidt said Novell's new ambitions are simple.
"I like to think of it as we're building the fabric of the Net," he said.
Novell also has to keep its NetWare core customers pleased. The company just released a version 5.1 upgrade to the operating system and plans to incorporate new features for chip giant Intel's forthcoming high-end 64-bit microprocessor, called Itanium. "Contrary to rumors, the NetWare franchise is growing and customers are happy," Schmidt said.
But Novell hopes to avoid engaging in any type of operating system war by creating a market based on its directory software and associated applications. Similar to a database, a directory can be a central point for network administration, security and synchronization with other systems on a corporate network or the Internet--a market that could be huge given the explosion of Net-based computer usage.
"There's a new battle here," Steve Adams, senior vice president of worldwide marketing for Novell, told a packed hall of Novell loyalists. "Net services becomes our mission."
"Denim" essentially represents Novell's umbrella term to explain to its customers and employees what the company's focus is. Microsoft has had its own challenges adapting to an increasingly Net-based software market.
Wall Street has been receptive to Novell's revised message. The company is trading at nearly double its 52-week low. When it bottomed out, it was trading in the single digits--a far cry from today's close of $31.38.
Analysts said that indications such as the company's use of Denim to explain a wide array of esoteric technologies is a good step. "They used to be all over the place (in their marketing)," said the Burton Group's Lewis.
Net filtering company Websense today priced its initial public offering at $18 a share, a 12.5 percent increase over its recently raised pricing range and a sign of strong investor demand.
The company, which provides Web filtering and traffic management software, raised $72 million through a sale of 4 million shares. The company plans to begin trading tomorrow on the Nasdaq Stock Market under the ticker "WBSN."
Demand for Websense's IPO comes amid investor demand for Internet infrastructure companies. FairMarket, which helps companies build online auctions, was another recent infrastructure company to grab the money and minds of investors. FairMarket shares priced at $17 and nearly tripled on their first day of trading earlier this month. The shares today closed at $39.06.
Late last week, Websense raised its pricing range to $14 to $16 a share from its initial range of $12 to $14.
In addition to its role in the Internet infrastructure market, IPO analysts also favored the company because it has some big-name customers, including American Express, BellSouth and Coca-Cola.
Those customers helped Websense generate $8.6 million in revenues last year, an increase from $6.9 million the previous year. The company posted a widening loss of $9 million for the year, however, compared with $5.6 million a year earlier.
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The race is on to control the potentially lucrative market for interactive television. Mere hours after OpenTV announced its acquisition of browser pioneer Spyglass, Liberate bought out software firm MoreCom. And Microsoft has its own ideas.
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TV race heats up with Liberate deal Liberate Technologies agrees to acquire MoreCom, a provider of software for interactive video services, in a $561 million stock transaction.
OpenTV to acquire Spyglass for $2.5 billion
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The new company, called GeoVideo Networks, will take advantage of technology developed by Lucent's New Ventures Group to create a network and suite of software focused on high-speed Net video, which is often slowed by roadblocks on the public Internet.
Along with fiber-optic network partner MetroMedia Fiber Network, the company will initially aim its services at businesses, which are close to urban fiber networks and have considerable demand for high-speed, high-quality video. The company cites university telemedicine, teleconferencing or the long-distance video connections used by television stations as possible candidates.
The company also will add consumer applications such as video-on-demand services as the market matures, it says.
"The possibilities are pretty much endless in terms of applications," said Lucent spokesman Chris Pfaff.
Lucent is just one of many companies targeting the high-speed video market as the Net matures to the point where video and other multimedia content is increasingly commonplace.
Businesses have long had connections to the outside world fast enough to handle video, which requires far more bandwidth than ordinary text or Web graphics. This kind of connection is filtering down to the consumer level as more households sign up for cable Internet or high-speed digital subscriber line (DSL) service from the telephone companies.
But the Internet itself has enough glitches and roadblocks that video services are often well below par. A recent example saw the Victoria's Secret Web site stumble under the load of requests for a live fashion show.
The Lucent technology would take advantage of the huge bandwidth available on MetroMedia's fiber network to make an end run around much of the public Internet's blockages, and then use software developed inside its Bell Labs to streamline the delivery of the video.
As one example, a GeoVideo browser will allow customers to tailor their connections to receive HDTV-quality video or higher, depending on their connections, or have up to 16 windows open simultaneously receiving different videoconferencing signals.
The new company also will be working with a coalition of 27 public television stations around the country, which will serve as network connection hubs for different tentacles of the urban video networks.
GeoVideo joins dozens of other start-ups that have been spun out of Lucent's New Ventures group in the last several years. Most recently, the firm unveiled a telephone-based Internet browser that reads the content of Web sites to callers. \ Internet visionary and Netscape Communications co-founder Marc Andreessen will announce tomorrow he has invested in Collab.Net, a site for uniting corporations with open-source programmers.
Andreessen, now a member of the Collab.Net board, said he already has begun helping the company with its quest for more funding and customers. He joins Benchmark Capital as an investor.
Collab.Net functions as a cross between a middleman and a diplomat. The company charges a fee to connect companies with programmers from the vast, largely unorganized open-source community. In the open-source movement, software design isn't secret, so anyone can contribute to the effort.
The open-source movement is a grass-roots collection of sometimes colorful characters who have collectively created successful software such as the Linux operating system and Apache Web server software. But at times, the open-source world's strong philosophical stance and heated rhetoric can make for rough going for companies trying to hire developers.
Andreessen will raise Collab.Net's profile, said Giga Information Group analyst Stacey Quandt. The start-up already has strong open-source ties through chief technology officer Brian Behlendorf, a key figure in the Apache movement, but Andreessen will give Collab.Net a higher profile with proprietary software projects, she said.
Andreessen is "someone who can see application development from both sides, the proprietary and open-source models," Quandt said.
Indeed, Collab.Net chief executive Bill Portelli hopes that signing Andreessen will help get the word out about the company. "Marc is very well-networked," he said.
Andreessen's strongest ties with the open-source community stem from 1998, when Netscape decided to open the source code of the Netscape Web browser in a program called Mozilla. Though Andreessen acknowledges that project hasn't experienced the success of Linux or Apache, he believes interest in the browser will increase once a test version of the software is released in coming weeks.
Collab.Net is one of just a few boards Andreessen has joined since he left America Online. "I try to be selective," he said. "The kind of things I'm interested in are the ones that have a potential to have a transforming effect on the landscape."
He also is a member of the boards of CacheFlow, which builds special servers to speed Internet data transfer; Accompany, now called MobShop, which lets consumer band together to obtain lower prices on what they're buying; and Loudcloud, Andreessen's own start-up that helps companies set up complex Web sites quickly. He also is an investor in ReplayTV but resigned from its board because of conflict-of-interest issues when AOL acquired Netscape.
Netscape, the company that helped launch the Web revolution with its first browser, was one of the first Internet companies to see its valuation soar. Andreessen isn't the only former Netscape employee joining boards and investing in start-ups. Netscape chief executive Jim Barksdale and chairman Jim Clark also turned into venture capitalists. Clark has backed Healtheon and MyCFO.com, while the Barksdale Group has backed HomeGrocer and Tellme.com. And while Clark has put his weight behind Shutterfly.com, Barksdale invested in the competing photography venture Ofoto.
Andreessen became more interested in Collab.Net when Frank Hecker, one of the three highest-ranking programmers at Netscape, joined the company. "That was the first time I sat and went, 'Hmm, that's interesting,'" Andreessen said.
Collab.Net also hired James Barry, the former IBM employee who was instrumental in getting Big Blue to adopt Apache into its own e-commerce software package.
Collab.Net's SourceXchange site for connecting programmers to companies competes chiefly with VA Linux Systems' SourceForge site, Quandt said. SourceForge has attracted hundreds of projects in the few months since its launch, but it doesn't focus on the rigors of working with companies.
Collab.Net offers a request-for-proposal process that allows programmers and companies to better evaluate each other. For example, Vovida Networks posts a laundry list of requirements in its proposal seeking programmers who can provide a graphical interface for its Linux software that lets a computer act like a telephone.
Though Collab.Net's roots are with open-source efforts, the company is expanding into a second, more proprietary realm, Portelli said. The company will host development projects for "gated" communities that still can benefit from Collab.Net's group-programming tools. For example, a company and its business partners often need to make sure their software products dovetail.
A third part of Collab.Net's business is in consultant work, advising companies on how best to work with the open-source movement--whether to open software up, when, and the best license to use for different circumstances.
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Following are the latest developments in the antitrust suit filed against
Microsoft by the Justice Department and attorneys general from 19
states.
Latest stories Talks go on as Microsoft proposal is scrutinized Sources say that despite a last-minute proposal from Microsoft, ongoing settlement talks in the landmark antitrust case have seen little progress. (March 27, 5 p.m. PT)
Government unimpressed with Microsoft settlement offer
Microsoft offers to settle antitrust case
Microsoft, DOJ may be closer to settling
Klein says serious antitrust remedy sought
Analysts say settlement possible in trial
Harvard professor mutes antitrust skepticism
"Plausible benefit" is key phrase in antitrust trial
Microsoft case in last hearing before final ruling
Could Microsoft open source code to settle?
Breakup dissension not stopping Microsoft settlement talks
Poll shows most oppose breakup
Microsoft trial a battle of public favor
Friends, foes file comments in antitrust case
DOJ, states counter Microsoft filing
DOJ, states to rebut Microsoft's antitrust arguments
• Two suits filed against Microsoft in Ohio • Judge taps Posner to fight "divergent" government views • Will Microsoft class-action suits spawn more? • Judge appoints mediator in Microsoft antitrust case • Microsoft faces legal scrutiny at every turn • Drama unfolds in wake of judge's ruling
• Judge calls Microsoft a monopoly • Microsoft faces uncertain penalties in case • Judge: Microsoft's monopoly power hurt many • Microsoft's competitors "delighted" • Microsoft investors weigh impact on stocks |
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