Rumours based upon a Reuters interview with Bertelsmann AG board member Thomas Middelhoff suggesting that American Online Inc, the largest of the US on-line services, and Netscape Communications Corp, are in talks that could lead to a merger were denied by both companies as we went to press last night. According to Reuter, Middelhoff – whose company has a significant stake in America Online – said that a decision on a merger could be made within a month. He noted that new data showed that 40% of US Internet traffic was flowing through America OnLine’s network and that together with Netscape the two companies would effectively control the technology now shaping the global network – And then Microsoft would be left without an Internet standard, he said.
Multimedia Separately, Netscape said it has definitive agreement to acquire InSoft Inc, developer of network-based communications and collaborative multimedia software. Netscape plans to use the technology to create the Netscape LiveMedia framework, intended to become a standard component in future Netscape clients, servers and tools. LiveMedia framework is intended to give users easier access to new applications such as audio and video on- demand, real-time videoconferencing and Internet telephony. Netscape is to pay 1.96m shares, worth some $160m for privately- held InSoft. Meantime AOL announced it had just acquired the privately-held Johnson Grace Co, Newport Beach, California, a developer of data compression technologies, for approximately $70m.
