June 11, 2002 10:00 AM PDT

AOL sets sights on businesses

America Online is quietly gearing up to sell its Internet software to corporate customers.

A division called AOL Strategic Business Solutions will package various Internet server software products developed by the company's Netscape unit for sale to businesses. One of the primary products offered will be a version of AOL Instant Messenger, customized for corporate use by adding security for private, internal communications.

Another of the products weaves together AOL's calendar, address book and Web site hosting services, according to the unit's Web site. A third service allows companies to offer on their own Web sites content from AOL Time Warner, such as CNN news feeds, and AOL Web services, such as MapQuest.

The division already has a major partner, Hewlett-Packard, which is including version 6 of the Netscape Directory Server along with its version of Unix, said Ram Appalaraju, HP's director of marketing for the product. Directory servers are useful for tasks such as storing username-password combinations.

This is not the first time AOL has tried to dip its toe into the enterprise market. When the online titan acquired Netscape Communications in 1999, it formed an alliance with Sun Microsystems to sell Web server software and technologies for corporate use. The initiative, called iPlanet, has since been taken over by Sun, which now sells the software under the Sun Open Network Environment (Sun ONE) label. But while the Netscape employees working on the joint project became Sun employees, AOL retained rights to sell the Netscape software.

AOL spokesman Marty Gordon downplayed the Business Solutions initiative, saying the effort is just an evolution of Netscape's enterprise technologies.

"We've been working with our partners for some time since the Netscape acquisition, and it's been a nice business for us," Gordon said. "We're continuing to move the products forward with our partners."

The initiative will intensify AOL's competition with Microsoft, which has established itself in the enterprise market for Internet services. Other competitors such as Yahoo have also been trying to package Web services for corporate use.

The corporate market is attractive for AOL because the company can charge businesses to use special versions of its software, such as instant messaging and the address book, that are typically free for consumers. The enterprise market also offers another source of revenue separate from the lackluster advertising environment that has crippled online media companies.

News.com's Stephen Shankland contributed to this report.

 

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