The real value in Netscape Communications Corp’s coup in persuading five US Regional Bell Operating Companies to offer its Navigator browser as the default system for their Internet services (CI No 3,061), lies in the corporate intranet services all five also plan to sell. Although financial terms were not revealed, apparently Netscape has put a cheap enough price on Navigator – and its successor Communicator – for the Regional Bells to plan to bundle the software in the price of their Internet services. More significantly, the companies confirmed to Network Briefing that an unpublicized part of the agreements covers use of Navigator and Netscape servers in corporate intranets, a business that Netscape is keen to cash in on. In return, Netscape has given the phone companies top billing on a new Internet service provider Select service it has set up for instant on-line Internet account sign-ups, a move that’s bound to make other service providers unhappy. Microsoft Corp has already given premium sign-up positions to AT&T Corp, MCI Communications Corp, CompuServe Inc, America OnLine Inc and its own Microsoft Network – any one of which already serves more surfers than all five of Netscape’s Regional Bell partners combined. But Netscape and the five Bells – Ameritech Interactive Media Servers, Bell Atlantic Internet Solutions, BellSouth.net, Pacific Bell Internet Services and Southwestern Bell Internet Services – are making much of the number of phone customers they have. Combined, the five cover 26 states with 72m phone subscribers in 15 of the 20 largest markets in the US. However, the Bells face two difficult problems. First, they are all coming into the game well behind US long distance carriers and on-line services, to say nothing of ‘pure’ Internet service providers such as UUnet and NetCom. Ameritech, for instance, isn’t even online yet. Second, – and Netscape can’t help them here – the Regional Bells only provide local Internet access. That means travelling surfers have to pay long-distance charges to call home to their service provider in contrast to the long distance carriers, on-line services and large Internet providers that offer local access numbers from almost any major city in the US and overseas.
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