Proprietary Services Move to the Web

Steven J. Vaughan-Nichols and Rachel Schmutter

Being on-line used to mean being on a proprietary service, like CompuServe or Prodigy. Not anymore. In the past few months, AT&T Interchange, Delphi, eWorld, and The Microsoft Network have all either abandoned their proprietary platforms or at least expanded their presence on the Internet's World Wide Web.

AT&T New Media Services (Cambridge, MA), developer and content provider for AT&T Interchange Online Network, recently announced that by the middle of this year, the AT&T Business Network, which provides business-focused content for Inte rchange customers, will exist primarily on the Web. Eventually, the proprietary Interchange service will be eliminated.

Several other on-l ine services are spinning into the Web. Last year, Rupert Murdoch's News Corp. and MCI Communications (Washington, D.C.) formed a joint Internet ventures company that will develop content for the Web in cooperation with News Corp. media companies such as TV Guide and Fox Broadcasting. Nancy Morrisroe, a spokeswoman for the joint venture, said the new venture will eventually replace both Delphi and BIX.

Confusing the MCI-News Corp. project is MCI's new partnership with Microsoft. Microsoft, which says it has no immediate plans to close its proprietary on-line service, The Microsoft Network (MSN), is joining with MCI to form "MSN from MCI," which will be launched around the middle of the year. Microsoft officials admit that the Web may eventually replace the current MSN back engine. However, that doesn't mean that certain services, such as content resulting from the Microsoft/NBC partnership, will be available for free.

By mid-'96, Apple's eWorld will be completely Web-based. And GEnie is moving to the Web this year under different management. General Electric is selling GEnie to New York-based Yovelle Renaissance Corp., a subsidiary of International Discount Telecommunications (IDT).

Three other major on-line service providers, America Online, Prodigy, and CompuServe Information Service, continue to view the Web as a complement, not a replacement. Even with Internet access, "80 percent of our customers' time is spent on CIS," notes William Giles, corporate spokesperson for CompuServe.

But the trend is clear: Except for those services that have millions of loyal users, content providers are dashing to the Web. How these Web-based services will make money is still unclear. According to Internet analyst J.D. Falk, a few businesses currently profit from advertising and value-added services. One possible path to Web-based prosperity is that of Time-Warner's PathFinder, which provides free access now but will charge fees in the future. The strategy is that by the time it starts charg ing its customers, the site will have a reliable user community.