Netscape Releases New Browser With Hopes Trimmed

By Eric Auchard

NEW YORK (Reuters) - Netscape, makers of the Web-browsing software at the heart of the U.S. government's antitrust case against Microsoft Corp. (NasdaqNM:MSFT - news), is set to unveil on Wednesday a much-delayed upgrade that marks the sharply curtailed ambitions of the once pioneering program.

Netscape 6, the latest version of the program millions rely on as their primary window to the Internet, will be introduced at a trade show in Los Angeles by officials of America Online Inc. (NYSE:AOL - news), which acquired Netscape last year.

But the software which created the first Internet explosion and once held nearly a 90 percent market share, faces an uphill battle against Microsoft's Internet Explorer, which now ships in every Windows PC and holds nearly 70 percent of the market.

Much of the Microsoft antitrust trial has centered on Microsoft's tactics versus Netscape. On Monday, the U.S. judge in the case ruled that Microsoft's actions violated antitrust laws by attempting to monopolize the browser market.

``This used to be a debate between Coke and Pepsi. But the discussion is no longer whether a particular brand of flavored soda sells well,'' said Clayton Ryder, an industry analyst with Zona Research of Redwood City, Calif.

For while the Netscape Web software has been plagued by delays in introducing new features, Microsoft has pumped out new versions that allow faster access to data and printing, simplify use of audio and video, and other improvements.

``The discussion has become how does this fit in as part of a fuller meal?'' Ryder said, referring to Microsoft's success in making Internet Explorer the standard to which many companies now develop new Internet programs.

Netscape's new software is the result of a drawn-out effort known as the Mozilla open-source project -- a volunteer network of independent Internet programmers who banded together more than two years ago to keep Netscape browser development alive.

The company chose to forego the release of the fifth generation of Netscape last summer, offering users of Netscape incremental changes to its Netscape Navigator 4.7 program.

Under America Online, the Netscape browser has been transformed from a single, monolithic product into a set of component technologies that are used not simply in Netscape 6 but have been licensed to a variety of other industry players.

Instead, Netscape developers have focused on making the new software more easily customizable and ready to run on software alternatives to the Microsoft Windows operating system that dominates on personal computers.

AOL has licensed the so-called ``Gecko'' browser technologies at the core of Netscape to IBM (NYSE:IBM - news), Intel Corp. (NasdaqNM:INTC - news) Liberate Technologies Inc. (NasdaqNM:LBRT - news), NetObjects Inc. (NasdaqNM:NETO - news), Nokia (NOK1V.HE), Red Hat Inc. (NasdaqNM:RHAT - news) and Sun Microsystems Inc (NasdaqNM:SUNW - news) for use in separately branded products.

AOL also is using the technology behind Netscape 6 as the core of its ``AOL Anywhere'' strategy, a bid by the world's top Internet services company to distribute Web services not only on PCs but via television, cellphones and handheld computers.

Ryder said the Netscape browser has become increasingly irrelevant among commercial Internet users. Instead, it has reverted to something akin to the original Mosaic browser, which popularized use of the World Wide Web in 1993.

``Netscape is not terribly different from its predecessor, NCSA Mosaic: it's got free distribution, it's become something of a toy, a research project, something techies like to play with,'' Ryder said. ``Have we come full circle?'' he asked.