Giants of the Internet

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Dea Ana Protic

G i a n t s O f T h e I n t e r n e t

The History of the Internet

In the year 1969 the Advanced Research Projects Agency
(ARPA) assigned the US Ministry of Defence to create a
computer net, which should firstly ensure the

communication in case of a nuclear attack and secondly

enable the collaboration between several research institutes.

The ARPANET was created that way and was soon the link between
several American universities.

How we experience the Internet nowadays cannot be compared with the
net from the past of course. The two most important Internet services are

eMail, the transmission of written messages between two places via the
digital way, and the World Wide Web, the part of the net we call the

Internet.
In the 80s the PC established its position in the private sector more and

more and the interest on the ARPANET rose. The Internet Society initiated
the WWW in 1992, and new branches of business arose, especially the

providers.
The biggest providers nowadays are AOL (America Online) with 24 million
users, CompuServe with 2.8 million users and MSN (Microsoft Network)

with 1.6 million users worldwide.

Major Internet companies
AltaVista, Amazon, America Online, Cisco Systems, CNET, eBay, ICQ,

Inktomi, Terra Lycos, Netscape, VeriSign, Yahoo!

NetCoaltion.com
On July 12, 1999 nine major Internet companies formed a lobbying group

to “speak with a clear, distinct voice for the concerns and interests of the
industry.” The members of the organization, called NetCoaltion.com, are

Amazon.com Inc., America Online Inc., DoubleClick, eBay Inc.,
Excite@Home Corp., Inktomi Inc., Lycos Inc., theglobe.com and Yahoo

Inc. Ninety percent of the world's Internet users visit at least one of these
sites each month. NetCoaltion wants to build user confidence in the
Internet through responsible market-driven policies, wants to preserve the

open and competitive environment that has allowed the Internet to
flourish and wants to ensure the continued vitality of the Internet through

active dialogue with policymakers.
Considering that some of this organization’s members are the most

powerful on the Internet, these aims sound beyond belief.

Giants of the Internet

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AOL – America Online Inc.

America Online is now the biggest, richest and most successful

Internet company in the world. That is because it is one of the
few Internet companies that has actually figured out how to
make money on the web - by charging individuals monthly

subscriptions to sign up to their Internet services, and by charging
companies to advertise their services. More than 24 million subscribers

pay a monthly fee of about $20 to access the Internet, there are an
additional 2.8 million people subscribing to its CompuServe subsidiary,

and 4.4 million international members.
AOL started with the foundation of Quantum Computer Services in 1985.

By 1994, after changing its name, AOL had a million subscribers already.
In the early years it was almost brought down by the problems of

introducing unlimited access for a fixed monthly fee. As usage increased,
so did capacity problems, making thousands of customers angry as they

could not get their connection to work. The problem was solved by a deal
with MCIWorldCom and a merger with rival CompuServe in 1998. AOL

further strengthened its position in 1998 when it acquired Netscape, the
Internet browser company, for $4 billion. The company also had to fend
off rivals, most notably AT&T, the biggest US telephone company, which

tried to take over AOL in order to launch its own Internet services. In
1999 AOL reached 20 million subscribers and in 2000 merged with Time

Warner, which was one of the biggest deals ever. Both companies hope
that AOL's huge user base will provide fertile ground for online marketing

and e-commerce, i.e. selling Time Warner products like books and CDs.
Time Warner describes itself as one of the world's leading media

companies. It owns the cable television channels CNN, TNT, Cartoon
Network and Home Box Office and is a publisher of magazines, books and

web sites. In 1999, AOL “shocked” the online world when it bought the
Internet pioneer Netscape. Other brands owned by the company are

Internet messaging service ICQ and Digital City. AOL has a strategic
alliance with computer and software firm Sun Microsystems, too, targeted

to undermine the dominance of Microsoft in the computer business.

Facts: Headquarters in Virginia, 15 000 employees, 2000: revenue $ 6.89

billion, 24 million AOL members, 2.8 million CompuServe members, 4.4m
international members

Revenues from eCommerce now make up one third of AOL's revenue. It

has commercial deals to market everything from General Motors cars to
financial services to computers with Compaq and Gateway. It is also

planning to be part of the Internet's mobile revolution, ensuring that it will
be on Motorola mobile phones and Palm Pilot handheld computers. One of

the biggest fears of AOL has been that it will be excluded from the
broadband revolution, which allows Internet services to be delivered at

much higher speeds than currently available from dial-up modems. They
allow the delivery of video-on-demand, interactive conferences and

gaming, and swift downloads at a cost little more than that of AOL's

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subscription charge. Now that AOL has tied up with one of the main
providers of high-speed cable Internet access, Time Warner's Road

Runner service, it remains to be seen how much it will continue to fight for
the principle of open access. AOL meanwhile has also invested heavily in
other ways of delivering broadband services, both through conventional

telephone lines and satellite television in the US. Recently AOL has tried to
expand its overseas activities, in the expectation that in the next few

years the Internet will grow faster in Asia, Europe, and Latin America than
the US. But it has not been as successful abroad as in its home market in

the United States, where it has a dominant position. That is partly
because of the different system of telephone charges, which means that it

is more difficult to offer unlimited access for a flat fee - which works in the
US because there are no additional telephone charges to pay, as local calls

are free.

AOL Brands and Services
All Chats (various chatrooms and discussions), Hometown (free

homepages), Instant Messenger (free communication software AIM 4.3),
Legal Department (online service about court decisions)
CompuServe (ISP), ICQ, Netscape, Digital Cities Guides (information on

popular cities), MapQuest (detailed interactive maps of major cities),
Moviefone (previews and reviews of the latest releases including chats and

online ticketing function), Spinner.com (internet radio with various
channels), WinAmp MPEG audio player

News
November 22, 2000: AOL Latin America announced the availability of a
regional Web portal, which provides access to visitors from 20 latin

American countries.
November 30, 2000: AOL unveiled the new AOL Mobile Communicator

(SM), a two-way wireless handheld device. That way AOL members can
take e-mail and instant messaging “anywhere”. It is a small, lightweight

(4.1 ounces) device, only available to AOL’s members, who wants to make
the interactive medium central to their everyday lives. It has a built-in
mini-keyboard, which makes it quick and easy to type messages or write

eMails. AOL said: "That's what we deliver with the AOL Mobile
Communicator: We're no longer talking about an

strategy -

we're making AOL Anywhere a reality."

Steve Case: Chairman of AOL Time Warner, former AOL CEO and co-
founder

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Yahoo! Inc.

Yahoo! Began – like many other parts of the computer

age – as an idea, grew into a hobby and turned into

full-time business. The two developers were David Filo and Jerry Yang.
They started a kind of guide in April 1994 as a way to keep track of their

personal interests on the Internet. Soon their lists became too long and
unwieldy, so they turned it into a database designed to serve the needs of

thousands of users. The name Yahoo! is supposed to stand for "Yet
Another Hierarchical Officious Oracle" but Filo and Yang insist they

selected the name because they considered themselves yahoos. Yahoo!
itself first resided on Yang's student workstation, "akebono" while the

search engine was lodged on Filo's computer, "konishiki." (These
machines were named after legendary Hawaiian sumo wrestlers.) They

developed customised software to help them efficiently locate, identify
and edit material stored on the Internet. In early 1995 Marc Andreessen,

co-founder of Netscape Communications, invited Filo and Yang to move
their files over to larger computers housed at Netscape. Today, Yahoo!

contains organised information on tens of thousands of computers linked
to the Web.
Yahoo! Inc. is a global Internet communications, commerce and media

company that offers a branded network of services to more than 166
million individuals each month worldwide. As the first online navigational

guide to the Web, www.yahoo.com is the leading guide in terms of traffic,
advertising, household and business user reach, and is one of the most

recognised brands associated with the Internet. The company also
provides online business services designed to enhance the Web presence

of Yahoo!'s clients, including audio and video streaming, store hosting and
management, and Web site tools and services. The company's global Web

network includes 25 World properties. Yahoo! has offices in Europe, the
Asia Pacific, Latin America, Canada and the United States, and is

headquartered in Santa Clara, California.

Services: Chat, Mail, Auctions, Shopping, Movies, Sports, Finance,
Messenger, Photos, Travel, Pay Direct, Entertainment

News
March 21, 2000: Yahoo! Mail and Yahoo! Messenger delivers Web services

to Palm Handheld Computers
June 29, 2000: Yahoo! Launched the Yahoo! Player, a streaming media

player for playing music and video
October 10, 2000: Yahoo! introduced Free Voice Access to content and

services, Voice Mail and PC-to-Phone Calling Consumers
November 22, 2000: Yahoo! Shopping goes mobile, it is available on Web-

enabled phones

Jerry Yang: Chief Yahoo and co-founder

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Lycos Inc. -> Terra Lycos Inc.

The Lycos Network is currently one of the most visited

hubs on the Internet reaching one out of every two Web
users. Its network of sites includes Lycos.com, Tripod,

Angelfire, WhoWhere, Lycos Communications, HotBot, HotWired, Wired

News, Webmonkey, Quote.com, Sonique, Gamesville, and
Matchmaker.com.

The Lycos Network provides leading Web search and navigation,
communications and personalization tools, homepage building and Web

community services and a shopping center. Integrated, these sites help
each individual user locate, retrieve and manage information about his or

her personal interests. Lycos believes that communities are at the core of
the hub. An Internet community personalises the Web, allowing people

with common interests to seamlessly find, communicate and collaborate
with each other, acting as participants, rather than observers. An online

community personalises the Web, enabling members to have individual
relationships in a global medium. Through its acquisitions of Tripod Inc.,

and WhoWhere Inc., in 1998, the Lycos Network has become the largest
and fastest growing online community with more than 5 million registered
Tripod and Angelfire members. 201 million average daily page views

worldwide. More than 61 million registered users worldwide.

Founded in June 1995, Lycos was one of the earliest search and
navigation sites designed to help people find information more easily and

quickly on the World Wide Web. In May 1997, Lycos began its
international career through a joint venture with European media house

Bertelsmann. In February 1998, Lycos acquired Tripod Inc., the leading
community site on the Web. With the acquisition of Tripod, Lycos became

the most full-featured community-oriented home base on the Internet,
providing free homepages to all users. In April 1998, Lycos extended its

international dominance through a partnership with Sumitomo Corporation
in Japan to bring localised Lycos services to Japan. The acquisition of

WiseWire in April 1998 and integration of its technology also established
Lycos as the only online service in its category to provide its users with
both a World Wide Web search engine and directory. In August 1998,

Lycos took another significant step in its move to become the leading
online service by acquiring GuestWorld, the Web’s largest provider of free

online guestbook services. In August 1998, Lycos again improved its
audience reach and strengthened its position as a premier Web

destination by acquiring WhoWhere Inc.and its complete line of Web-
based applications, including its leading directory services, popular

MailCity e-mail service and Angelfire.com, a leading Web community. In
October 1998, Lycos signed a definitive agreement to acquire Wired

Digital Inc., including HotBot, a leading Web site renowned for search
excellence. In February 1999, Lycos announced the audience reach of the

Lycos Network had risen to 48.8 percent, according to the Media Metrix
report of January traffic figures. With 27.1 percent up in ten months the

Lycos Network is the fastest-growing Web portal. In March 1999, Lycos

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formed a joint venture with Mirae Corporation to bring localised versions
of Lycos.com, Tripod and MailCity to Korea. In April 1999, Lycos

announced the Lycos Network had surpassed the Yahoo sites to become
the most visited hub on the Web. In August 1999 Lycos acquired Internet
Music Distribution Inc., maker of Sonique. Sonique is a popular audio

players, supporting many audio formats including mp3. In September
1999 Lycos acquired Quote.com Inc., one of the Web’s most

comprehensive financial information destinations. In October 1999, Lycos
announced its entrance into the Latin American market with the launch of

14 Lycos.com and Tripod.com country-specific localised sites for Latin
America, and two sites for the Spanish-speaking population in the United

States. In November 1999 Lycos signed a definitive agreement to acquire
Gamesville.com, a leading interactive entertainment company and direct

marketer. Gamesville reaches 4.5 percent of the monthly Web audience.

News
September 27, 2000: Lycos launched a WAP directory for mobile users

October 10, 2000: Together with BMG Entertainment Lycos Music makes
albums and singles digitally available. The two companies want to work
closely together to create and promote digital music content on the

Internet.
December 6, 2000: Terra Lycos and Headhunter.net, a recruiting site,

signed a multi-million dollar agreement for a new co-branded site.
October 31, 2000: Terra Networks, S.A. and Lycos, Inc. announced the

companies have completed their combination announced in May. The new
shares are expected to begin trading on the Nasdaq National Market and

the Spanish stock exchanges on Tuesday, October 31, 2000.

About Terra Lycos

Terra Lycos is a new global Internet network operating

in 40 countries in 19 languages, reaching 91 million
unique monthly visitors worldwide. Created by the

combination of Terra Networks S.A. and Lycos Inc.,

Terra Lycos is one of the most popular Internet networks in the U.S.,
Europe and Asia, is the leading portal to Spanish- and Portuguese-

speaking markets, and is the number three access provider in the world.
The Terra Lycos network of sites includes Lycos.com, Terra.com,

Angelfire.com, ATuHora.com, Gamesville.com, HotBot.com,
htmlGEAR.com, Invertia.com, LycosZone.com, Matchmaker.com,

Quote.com, Rumbo.com, Sonique.com, Tripod.com, Webmonkey.com,
WhoWhere.com and Wired.com. The company’s corporate headquarters

are in Barcelona, Spain and its operating headquarters are in Waltham,
Mass.

Juan Villalonga: Chairman of Terra Lycos, former chairman of Terra

Networks and Telefonica
Robert J. Davis: CEO Terra Lycos, former president and CEO of Lycos, Inc.

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Dea Ana Protic

Conclusion
Times of Web anarchy are definitely over, and it is not that easy anymore

to start up a company on the Internet.

And the “war” between the Giants of the Internet is going on: Providing

paid access to the Internet will get unimportant, because Internet for free
will rise in the next years like in the US.

The aim will be to have as many users as possible, who are on the

company’s own sites as often and as long as possible – because then
advertising customers will pay higher prices.

And the best formula for catching users is Content & Commerce: providing

interesting content and good online shopping possibilities.