July 14, 1998 6:45 PM PDT

Is browser war near end?

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Could this be the beginning of the end of the browser war? The answer depends on whom you ask.

According to one study, released yesterday by Zona Research, Microsoft's Internet Explorer is the browser of choice for 55 percent of companies that have a browser policy, compared to 45 percent for Netscape Communications' Navigator.

Internet advertising firm AdKnowledge released a similar study two days ago. That one said Netscape is still leading the race but is slipping, with 52.2 percent of market share, down 8.9 percent from six months ago. However, that study also showed that Microsoft had gained 9.6 percent over the same period to occupy 45.6 percent of the browser market.

Despite the difference in outcome, one thing is for sure--Netscape's share of the browser market is starting to slide, despite its efforts to hang on to the lead.

Still, most Source code for the masses studies surveying the market as a whole have not given Microsoft credit for the lead yet. Just a few weeks ago, a study conducted by International Data Corporation maintained that Netscape held the browser lead in 1997.

The browser war is dramatically different today than it was a year ago. For instance, it has all but eliminated third-party contenders, leaving the door open for a bitter feud between dominating brands--much in the spirit of the ongoing saga between Coke and Pepsi, said Zona Research chief analyst Clay Ryder.

"It's the Coke or Pepsi thing," said Ryder. "There clearly are no Shasta colas left."

Ryder also noted that distribution will also be a major factor determining the success of either browser. Microsoft currently holds a strong advantage in the workplace, since IT managers are attracted by the cost savings of having an IE browser bundled into an operating system.

From the access end, IE has the advantage of serving the 12 million AOL users with its browser. But there are still many ISPs who allow both options, and that may be one way that Netscape has stayed in the game.

What remains is that being the browser of choice may come down to specific details, such as policies in businesses, instead of distinctions of product quality. The two browsers virtually are the same.

"I think what's going to happen is that the rate of change is probably going to slow down," Ryder added. "Now it's the case of going in and displacing a competitor or wining hearts and minds of all new deployments.

"The battle is really over a percent here and a percent there."

As Microsoft's obsession for market dominance and Netscape's ongoing downplay of the situation continues, some analysts wonder whether these companies are working to improve their products while taking shots at each other.

"Most of their war is about Netscape making the browser into a groupware client and Microsoft preventing Netscape from making it into a groupware client," said David Card, an analyst at Jupiter Communications.

Amid the mudslinging between the two sides, the browser landscape has undergone a lot of change.

Up until early this year, Netscape charged for its browser suite, while Microsoft offered its browser for free. Netscape in January followed Microsoft's lead in offering its Navigator browser free of charge. It also decided to give away the source code of the next generation of its Communicator suite to the Web development community. It created the Mozilla.org organization to guide that community's work using Communicator code, as part of its effort to rally developers around the suite.

In addition, the war between the two companies may soon shift to a new battlefield. Both companies are "going portal," and leveraging their browser distribution as starting points for their respective Internet gateway sites. Following the lead of Yahoo and Excite, Netscape and Microsoft are now trying to attract new revenue streams from advertising and e-commerce from their portal projects Netcenter and Start.com, respectively.

NEWS.COM's Paul Festa contributed to this report.

 

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