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Hot In '97: Change Is Certain

By Clinton Wilder
Issue date: Jan. 6, 1997

When people define an "Internet year" as a period of time lasting 30 days or so, change must be happening at a mind-boggling pace. In 1997, the Internet will easily be IT's hottest field. Within it, some areas will be downright sizzling. These concepts may not be new, but pay attention: You may not recognize them a year from now.

Electronic Commerce
Just 24 months ago, a debate raged about whether commerce was a proper use of the Internet. Once that subsided, the debate turned to security concerns, with businesses and consumers rightfully jittery about the vulnerability of credit-card numbers and sensitive corporate data traversing the Net. But thanks to trusted encryption schemes, as well as steady advances in Internet infrastructure, electronic-commerce proponents are overcoming the most important security challenge of all: perception.

Although the Internet is far from perfect, businesses and consumers have unprecedented confidence in it as a venue for buying and selling. Success stories like bookseller Amazon.com have proved that it's possible to make money on the Net by selling something other than ad banners. For large companies this year, the question about doing Internet commerce is no longer whether, but how. It won't be a smooth ride, but electronic commerce on the Internet will be flying in '97.

Not long ago, businesses were scoffed at for not having a Web site. Now, even some companies that pioneered the Web as a marketing tool are being derided for sites that offer no more than "brochureware." "A year ago, our Web efforts were still viewed as R&D dollars. Now it's the real nitty-gritty of our business," says Jim Kessler, director of global electronic commerce at electronic parts maker AMP Inc. in Harrisburg, Pa. In 1997, AMP looks to make money not only from selling products on its Web site, which was launched a year ago, but also from helping other companies sell through its AMP eMerce Internet Solutions business, started last fall.

To date, consumers haven't rushed to embrace electronic shopping. Few Web sites offer much more than HTML versions of their print catalogs or in-store displays. Amazon.com succeeds not because it sells books online but because it redefines retailer-customer relationships. Amazon customizes its content based on a user's buying history, uses agents and E-mail to tell customers that a new book of interest is available, and even pays other sites for sending sales referrals over the Web.

"The goal of electronic commerce in 1997 will be to move beyond just selling something to establishing an ongoing conversation or relationship with your customers," says Geoffrey Bock, an analyst at the Patricia Seybold Group, a research firm in Boston.

Intranets
One of Netscape CEO Jim Barksdale's favorite lines is, "The best way to be a leader is to find a parade and get in front of it." He's referring to the intranet explo-sion, which transformed a large part of corporate computing last year and will only continue to grow in 1997.

For IT managers who have endured years of software and network incompatibility headaches, the intranet concept is almost too simple. Put standard Web browsers on users' desktops connected to a TCP/IP network, and you've got your own Company Wide Web.

If having an intranet was last year's innovation, this year's will be transforming it from an in formation access tool for employees to a platform for real collaborative applications. By the end of 1997, most corporate intranets won't be known as the place to find the corporate phone directory or details on the 401(k) plan; they'll be the place for group discussions and planning, project management, sales forecasting, and product development--the activities that define the business.

Netscape, which has built most of its business by supplying intranet software, will try to hasten this transformation in the first quarter of next year with SuiteSpot 3.0, a server suite that integrates 10 different server modules for collaborative applications and network management.

Microsoft will take a similar tack with the integration of Exchange into the forthcoming ActiveServer platform. And Lotus will look to continue the momentum of Domino, the server that makes Notes fully Web-compatible. Does this mean a bloody, three-way, winner-take-all market battle in the works? Not even. The intran et market will grow fast enough in '97 to create plenty of business for all three platforms.

Extranets
Extranets will inherit the mega-hype mantle from intranets in 1997. Industry heavyweights from Netscape's Marc Andreessen to IBM's Lou Gerstner have identified extranets as a key growth area this year. Why? Because the extranet concept applies the open standards of Internet technology to one of the most critical and strategic aspects of business today--fast, easy, and reliable communications with business partners, suppliers, and customers.

The extranet concept is fairly simple: opening a door in your intranet firewall, through secure passwords, to company stakeholders who need access to business information. Key business-to-business customers, strategic alliance partners, research labs, or suppliers can log in from standard Web browsers to securely access whatever data your company wants to make available. Add in the collaborative applications expected to explode on the Net this year--groupware, audio- and videoconferencing, whiteboards, and of course, E-mail--and you have a powerful business tool.

Companies that got their feet wet in the extranet waters last year will be looking to expand their extranets to more users. Snap-On Inc. in Kenosha, Wis., a $1.4 billion tools manufacturer, communicates with about 250 of its franchised dealers via its Netscape Enterprise Server-based extranet. In 1997, it hopes to expand it to include more Snap-On franchisees, who total 4,000 in the United States and Canada.

"Using an Internet infrastructure gives you the chance to go after opportunities much faster than with standard IT processes," says Larry Panatera, VP and CIO at Snap-On. "It makes things a lot simpler for one-to-many communications. You don't have to go through layers of management and memos to put out a message. We put it up on the extranet and 4,000 of our best customers get to look at it." Snap-On's network also includes forums for its dealers to share tips on business practices like cash management and selling techniques.

Look for extranets to start taking over a lot of the business chores, such as purchase orders and invoices, that have traditionally been handled by electronic data interchange on expensive and proprietary value-added networks. "Internet technology makes so much sense for these networks," adds Panatera. "It's pervasive, economical, and easy to build."

Java
There's no doubt that plenty of Java will flow through corporate computers and networks in 1997. But which Java will it be?

That question is sure to create lots of industry headlines--and IT management headaches. Microsoft's effort to create Java applications optimized for Windows threatens to fragment Sun Microsystems' Java vision of "write it once, run it anywhere." And it has industry pundits and IT executives shuddering at the memories of Unix, the alleged universal operating system that splintered into the not-always-compatible "mu ltiple flavors" of Unix.

"Being cross-platform is Java's huge advantage," says Wendy Shapiro, director of operations at Neoglyphics Media Corp. in Chicago, which develops Web applications for Ford, Ameritech, Federal Express, and others. "It's not appropriate everywhere, but for anything that a corporation wants to share, this is the way to do it."

Microsoft believes that some Java applications are more powerful if they're optimized for Windows only, and it's counting on the support of third-party Windows developers. In December, Sun's JavaSoft unit led the formation of the 100% Pure Java initiative, which will begin testing, certifying, and branding "pure" Java applications early this year. The emergence of two separate and probably unequal types of Java--Pure Java and Microsoft Java--is a possibility.

Even in bifurcated form, however, Java will be where the action is for corporate Web application developers in '97. "Java has had the fastest adoption of any language in the histo ry of the industry," says Mark Jarvis, VP of server marketing at Oracle. JavaSoft president Alan Baratz notes that more than 150 books have been published on Java programming, compared with roughly 20 on Visual Basic. In 1997, tools like Oracle's J/SQL, which makes Java as effective as PL/SQL for developing database applications, will bring Java even more into the mainstream of strategic business applications. And Java-based innovations like Marimba Inc.'s Castanet for broadcasting Web content will continue to fuel the language's momentum. The days when Java meant applets and spinning logos are over. Fragmented standards may slow it down, but nothing will stop Java's momentum this year.

Legacy Links
Microsoft likes to call its Internet strategy "embrace and extend," but virtually every major enterprise software vendor could say the same thing. Last year, companies like SAP, Baan, PeopleSoft, Oracle, Sybase, Informix, IBM, Computer Associates, and Lawson Software all rolled out major pl ans, and in many cases new products, to extend their software capabilities to the Web. By the end of 1997, any database, application, or tool vendor whose products don't work with Web-browser front ends or other links might as well not even be in the market.

Despite major Java development initiatives at companies like CSX, Ford, and most Wall Street financial firms, businesses are simply not going to rip out their legacy applications in favor of Java or ActiveX replacements. "You can't change that whole software infrastructure overnight," says Beatriz Infante, senior VP of Internet and media products at Oracle in Redwood Shores, Calif. "It has taken companies too long to put it in place."

Browsers And Plug-ins
There won't be a browser war in 1997. Actually there will be, but it'll be called something else. We hope something catchier than The Battle Of The Desktop Information Access Paradigm, but that sums it up.

By mid-year, Netscape Communicator and Microsoft Acti ve Desktop will be vying for the right to be called the client interface of choice. In 1996, the success of Netscape Navigator and Microsoft Internet Explorer sowed the seeds of their demise as standalone products. An HTML interface with hyperlinks was such a great way to access information that the companies thought, why not access everything that way?

"By the end of this year, we will all browse our desktop," says Clay Ryder, a director at Zona Research Inc. in Redwood City, Calif. "No one is going to know or care anymore what you call it, but the way we access information will be in the browser paradigm."

One of the hottest areas of the interface this year will be information delivered to the desktop--the so-called netcasting model pioneered in 1996 by the PointCast Network in Cupertino, Calif., which rocketed to 1.7 million users in just eight months. PointCast signed on in December to deliver its streaming news to Microsoft's Active Desktop. Netscape's Constellation software will be a ble to receive content using Castanet netcasting technology from Marimba in Palo Alto, Calif.

Other recent startups such as DataChannel, BackWeb, and InterMind are appearing with different technologies to support the "push" model. But the real killer application here may turn out to be agents and filters that can help users manage the content. Netcasting technology is compelling, but if users feel bombarded with information delivered to their screens, they may decide that the "pull" model of Web browsing wasn't so bad after all.

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