(formerly "A Clue...to Internet Commerce")
by Dana Blankenhorn
Volume II, No. XIV
For the Week of April 6, 1998
Back-up. I learned again of the need for back-ups a week ago. I'd overwhelmed the ability of my old QIC-80 drive (tape's dead), and had taken to backing up my desktop with my laptop, and vice versa, using Laplink and a serial cable to keep both sides current. Then the modem went out on the laptop, and the desktop stopped recognizing its CD-ROM drives (as well as the QIC-80). The best solution, in both cases, was to wipe the hard disks, which cost a total of $50, but suddenly I was out of business.
I lost a lot of stuff, and learned in the process what mattered (files) and what didn't (applications). I'll never forget one afternoon at the PC repair shop, when the owner gave me an MS-DOS connection to my desktop drives and let me take away what I could copy (and could remember how to get) on the laptop. I'm back (for now) but I had learned what I, and you, should always do in the future.
First, prioritize. Second, get those high-priority files somewhere else. Maybe to the Web, when you're not relying on your modem. Our Clue is for outfits like Traveling Software. Get yourself some joint ventures with Web-based back-up operations. Combine your software - which can clone itself on remote machines - with a high-bandwidth facility so I can update my important stuff each night in a few minutes. I even have a name for this emerging industry - Personal Disaster Recovery.
The closest to this ideal I could find on the Web was Offsite Data Management Services, Brooklyn, New York. But they're aimed at servers, not clients. Major ISPs already offer multiple megabytes of server space to consumers (for home pages) at just $20-50/month. Here's a great way to expand demand.
There's another Clue from all this, and that's a way to think about new niches. Look for stuff you'd like to do, or you'd need done, when you have more bandwidth or persistent bandwidth. How can you combine the software you use with the data you need in new, valuable ways? Now, if it's valuable to you, think how valuable you can make that to someone else. And instead of thinking about what people want, ask yourself what they'll need, when push comes to shove? That's a way to start a business plan.
We're trying to run this "business" on a more businesslike basis, hence our new URL. It's more than our URL, it's our new name, pronounced "a dash clue dot com." After appearing on the CompuTalk radio program March 21 with host Tom King, I also agreed to post these letters on the show's Web site as its "Internet" column. As usual, I'm also talking to lots of new publishers, thanks to contacts made at Internet World .
Still, you know the drill. It's Journalism -- checking the news, calling people, listening carefully, writing on deadline -- which keeps the Clues coming, although I also handle consulting and commercial writing (ask about those rates via e-mail). If you're looking for excellent work, as found in Atlanta Computer Currents, at PlugIn Datamation or in Net Marketing magazine, among other locations, don't wait for the e-mail -- give me a call at 404-373-7634.
And now back to our show...
International Data Group, which has quietly built a network of 200 different Web sites, rather than simply moving its publications online, has come out with a set of "ethical guidelines" for those sites it's proposed as a standard for the rest of us.
Most of them are basic publishing kant. Publishers control their sites, not advertisers. Credible and biased (advertising-supported) material must be clearly labeled. When you put your logo somewhere, you control what follows. Don't sell links. (So far, so good.) Of course you protect your credibility. Make sure when you write something, readers know it comes from the heart, not the wallet. Oh, and IDG says you should always have a link to an "about" box on your home page.
At this point, the IDG guidelines go into directions that make sense on paper, but become Clueless when rigorously applied online. Don't refer to advertorials in your table of contents? Editors can't work on them? Your own search engines can't be biased in your favor? Don't put ads for products near stories on the same product categories?
In other media publishers engage in commerce, while editors manage the credibility account. There's a clear divide because real commerce goes on somewhere else - at a store, by mail, over the phone. But on the Web we're all publishers, we're all stores, and we must all manage our accounts of credibility. The IDG rules are, seen in that light, simply extensions of the old media's norms into the new, and that's Clueless.
I've said it before and I'll say it again. This medium lets you deliver the entire marketing process - from prospecting to pitching to making the sale and providing customer service. Advertising represents just 5% (maybe) of the total marketing equation. IDG is saying my involvement in the other 95% of the marketing cycle is unclean, not credible. But when someone's convinced to pursue a purchase, why shouldn't they have fast access to the means of completing it? When a story encourages you to pursue biased (advertising) data on a product, why put roadblocks in front of the process?
Yes, coverage must be credible. No, you don't sell your byline. But those who don't use all the Web's capabilities will fail, and they deserve to fail.
Netscape's beta release of Communicator 5.0 last week has thrilled developers for its extensive support of the EXtensible Markup Language (XML). Netscape apparently hopes XML will give it an advantage over Microsoft in the next iteration of the browser wars, and the company's giving control of its XML module to developers.
It's all very Clued-in, but don't rewrite your pages just yet. As an organism grows, it changes more slowly. Check your server logs - most users are still on Version 3.0 of their browsers, even though Version 4.0 went Gold last summer. The real key here is Netscape's support for "freeware" development of the XML standard.
Given the fact that Apache still has twice the market share of Microsoft among Web servers (as we noted last week), O'Reilly & Associate's call for a "freeware summit" tomorrow (April 7) in Palo Alto becomes more significant. Among Netscape's new "peers" are the creators of Perl, Apache, Sendmail, Python, PGP, Bind and Linux. Tom Paquin, Netscape Fellow and manager of the "mozilla" free browser, has already confirmed his attendance.
Michael Dortch originated the term "the few with a clue," from which I took the name of this letter last year. He now sells his wisdom as a senior analyst with the Robert Frances Group in "The Valley" (while continuing to live in "The City") and when he favored us with a few of his unsolicited (and free) opinions, we had to pass them along.
Dortch' take is to compare Network Computing to Reagan's "Star Wars" plan for knocking out Soviet missiles. Michael didn't care for "Star Wars" although it was the FUD (fear, uncertainty, doubt) bomb that should get some credit for ending the Cold War earlier than it might have ended. (Maybe by months, maybe years, who cares? It gave us Anna Kournikova, so how bad can it be?)
Anyway, our friend notes that FedEx has decided on a Windows-centric approach to Network Computing, going with PCs and Windows-based terminals rather than anything from Sun. He writes it better than I do, so let him explain it:
"After all, on what are most of us running our business lives? Windows client applications, Windows server applications or 'big iron' applications running on some variation of Unix or some proprietary operating system. How are most of us running these applications? With Windows PCs. What are most information systems managers managing? Deployments of the above. So where do thin clients like NCs fit in enterprise networks?
"Well, they don't without help. In the short term, cool intermediary servers run "application brokers" like SCO's Tarantella, or Java application server environments like Tengah from WebLogic. In the longer term, all of our applications will be "Java-tized" via conversion to Java or inclusion of a Java-based interface for connectivity to Java-enabled browsers." (JavaOS, anyone?)
After whacking Scott McNealy and Larry Ellison's NC clients smartly about the head-and-shoulders a few times, our friend continues. "In case anyone's forgotten, where the promises vs. the realities of high technologies are concerned, we as users have been seduced and abandoned more often than Susan Lucci going after that Daytime Emmy. And if it weren't for Gates and Microsoft (not to mention many of their initial and eventual partners, like Andy Grove and Intel), we'd probably still be waiting for IBM to lower the price of the proprietary MicroChannel Architecture it inflicted on PCs in the mid-80s, not to mention the latest release of the set-top box based on the PCjr. Or perhaps for Unix vendors to finally get together and put a graphical interface and useful, interoperable applications on all their implementations of that operating system.
"Or, maybe not..."
OK, Mr. Dortch. PCs are cheap, but PC software ain't. The cost of a PC isn't in the hardware, but in the Microsoft license fees needed to make it useful. Our schools will never be able to afford the upgrade-cycle of Windows-based networking. They might afford super-servers, twisted-pair links to classrooms, and disposable clients. It's where the world has to go if the Net's to go from an upper-middle class affectation to a tool for everyone. So don't bury Scott or Larry (or Jim Barksdale) just yet. Not unless you want Orrin Hatch running this industry.
AT&T's decision to drop its all-you-can-eat pricing, effective May 1, offers key Clues for the Internet access market. Phone companies still have too-much overhead to compete in the consumer market - plenty of folks make a profit at $19.95/month. AT&T's marketers are still heavy-footed - instead of matching MCI's $14.95/month AYCE pricing for long-distance customers, they risked some of that market share, too.
Mostly, this is more proof that the big phone companies are moving toward VPNs and Web hosting, offering performance guarantees to justify their high prices. The prediction here is they'll be no more successful there - outfits like Goodnet and Savvis are too-savvy to throw their market into play. What's left then are power plays like US West is playing on DSL - claim you "invested heavily " (in dry alarm lines?) to keep out competitors and hope your political muscle will make the lie stick until profitable niches like the fast-access mass market's locked-down.
There are two major ISP market battles shaping up, and this announcement speaks to neither. Major backbone providers will continue to try and squeeze-out smaller players, denying them data and claiming they don't carry their weight. The consumer battle will play-out between RBOCs trying to defend their monopolies and small ISPs trying to provide high-speed services. To follow both battles, don't buy the hype or what major publishers write. Just click here.
Clued-in this week is NetGrocer, which signed a major ad deal with Excite just a week after rival OnCart went under. We should have seen this coming, since OnCart moved last year from alliances with local grocers to its own central warehouse system, mimicking NetGrocer's operation. NetGrocer can't get into perishables, and this deal is a major risk for the company, but its business plan is straightforward - ship FedEx from a central warehouse - and the rest could be done through alliances once (if?) profits start happening.
Clueless (and this is getting scary) our your friends at the Federal Bureau of Investigation, who have apparently begun spamming the owners of commerce sites on issues like terrorism under a program called Awareness of National Security Issues and Response (ANSIR). When you're trying to stop strong encryption and engaging in extra-territorial law enforcement (against gambling sites) does it really make sense to violate Netiquette and piss-off the rest of the Web commerce community?
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