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December 1, 1998

SOFTNET SIGNS THIRTEEN E-COMMERCE PARTNERS

By CBR Staff Writer

SoftNet Systems Inc has established relationships between its ISP Channel and thirteen e-commerce partners. The resulting broadband product, described as a branded online e-commerce and community information service, is to be called Locale. SoftNet hopes the services will generate three revenue streams: one from ad sales, another from transactions and a third in the shape of subscription fees for premium services. The company says it will share these revenues with its partners. It works like this. The first 100 Locale communities will be deployed in areas where 27 cable companies have already signed exclusive multi-year agreements to get their high-speed net access through SoftNet’s ISP Channel. Coverage is estimated at around 1.5 million homes. The local merchants are to get a free directory listing and basic web page. Inktomi and CityAuction will provide online shopping and auction services respectively. Inktomi and the ISP Channel will split ad revenues with the local cable affiliate and the three will take a cut of any transactions. Broadband content partners include AccuWeather, Prevue for TV listings and pay-per-view services, Spinner.com for streaming music and Jam TV/Rolling Stone for live concert webcasts. SegaSoft will provide access to its online gaming service, Heat.net. Through a Communications Center, Locale will offer free web-based email, free web pages and web-based calendars. Author Howard Rheingold, who helped create Locale, has assembled a teaching team called Community U to educate users in the intricacies of Locale’s advanced services. Tribal Voice’s PowWow is another part of the mix, adding online community with voice- based chat. SoftNet needs a compelling differentiator. Its rivals in a tough market include @Home and Time Warner’s Road Runner. Whether localized e-commerce services will be compelling enough to give SoftNet the edge remains an open question. The model is unproven, and among Microsoft’s many notable failures in online content are its costly Sidewalk city sites (CI No 3,522). Still, Sidewalk’s latest incarnation is as online malls. Maybe SoftNet is onto something after all. á

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