August 11, 1998 2:10 PM PDT

Compaq buys AltaVista domain

It took a few years and a reported $3.3 million, but Compaq today said the news is official: it now owns the coveted domain name "www.altavista.com."

Under the agreement announced today and widely reported by the press last month, AltaVista Technology Incorporated (ATI) will transfer the rights to its trademark and domain names to Compaq, which operates the popular AltaVista search and portal site. Financial terms of the deal were not disclosed.

But the $3.3 million figure has been widely reported by media outlets as well as sources that asked not to be named.

Whether it is exactly right or in the ballpark, the figure demonstrates just how valuable names are on the Net. Having a name that people recognize and remember can mean the difference between success and failure.

And Compaq, which got the AltaVista search engine when it acquired Digital Equipment, is working on beefing up the search engine in an effort to make it a hot contender in the portal wars.

Some have speculated that Compaq is dressing up AltaVista for sale. But whether or not Compaq keeps the site, it clearly sees the value in making sure that it has its own name.

Jack Marshall, cofounder of ATI, had registered the name "altavista.com" in 1994.

In November 1995, Digital launched a search engine by the same name, designed to showcase its technology. Digital posted the engine at "www.altavista.digital.com." But the search engine quickly became popular and users trying to find it simply looked for it at "www.altavista.com," ending up at Marshall's site--where they can have their photos digitized and put online, but they can't search.

Marshall agreed that the issue was causing confusing and signed an agreement with Digital to sell the name. In turn, Digital would license limited use of the AltaVista name back to Marshall, who said he needed the name to run his company. ATI's Web pages all contained the URL "www.altavista.com" and without use of the name, the company would have folded, he said.

On Halloween 1996, Digital sued Marshall's company, accusing it of breaching its licensing agreement and infringing on its trademark rights. Marshall's company had been redirecting Web surfers to Digital's search engine and Digital contended users were confused because Marshall did not specifically state that his site was not the search engine.

Today's announcement marks the official resolution of that suit.

Marshall now is focusing on the relaunch of his company under a different name: PhotoLoft.

 

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