Letter #5: Marc Andreessen (1997)

The Netscape Advantage

Hi there! I go by KG, and I love studying the history of business and investing. I’ll be sharing some notes from one Investor/Shareholder letter per weekday (mostly from my compilations) here.

Today’s notes are on Marc Andreessen’s 1997 blog post “The Netscape Advantage.” I’m still playing around with the format here, but today’s format is an essay annotation (Bold = my highlights, bullet points = some of my thoughts).

You can find this essay in my Marc Andreessen — Lost Files - The Netscape Years Compilation. This particular post starts on page 51.

I’m still figuring out formatting, so I’d appreciate if you let me know how you like this one compared to my previous ones.

If you have any thoughts on what you’d like to see, let me know!

Notes

"No matter what type of network you're looking at - intranet, extranet, or Internet – the benefits of using Netscape products are considerable."

In just five years of commercial use, the Internet has surpassed 50 million users - one of the fastest growth rates of any communication medium. With the number of users continuing to climb, we at Netscape believe the Internet's impact is just beginning. As businesses and people begin to be linked together at every level, we're starting to see many examples of what we call the Networked Enterprise. Our strategy to help enterprises achieve this is simple: wire the enterprise (intranets), link businesses to businesses (extranets), and link people to businesses (as with our new business online service, Netcenter).

  • Crazy to think that the entire internet only had 50MM users after 5 years. Definitely not directly comparable, but Pinduoduo itself registered nearly 10x that in the same amount of time (~500MM MAUs in 2020 from a 2015 start).

  • Goal: Bring businesses online — help them get online, help them connect with other businesses online, help them reach their customers online

To us, wiring the enterprise means providing access to existing business systems (mainframes, Unix machines, client-server databases, and even operational data) to every individual within an organization. This requires both a robust, ubiquitous server infrastructure that leverages the systems an enterprise has already deployed and a universal client that can be deployed on existing and future PC and network access devices. To this end we've built Netscape Communicator client software and Netscape SuiteSpot server software as key products to wire businesses and deliver full-service intranets. Consider what businesses and customers get with the Communicator-SuiteSpot combination:

Internet Groupware

Whether it's email (Netscape Messenger), scheduling (Netscape Calendar), online discussions (Netscape Collabra), or real-time communication (Netscape Conference), every Communicator component is scalable, directory enabled, and built on open platform standards.

Content Management and Information Publishing

On the server side, SuiteSpot includes agent-based workspaces (Netscape Enterprise Server), automatic indexing (Netscape Compass Server), and proxy replication (Netscape Proxy Server). With the Communicator client, you get an HTML-authoring tool (Netscape Composer) and a push channel selector (Netcaster).

Network Management

SuiteSpot's use of the Lightweight Directory Access Protocol (LDAP) gives IS managers an easy way to centrally manage all their user, group, and directory information. With Netscape Mission Control and Netscape AutoAdmin they can also centrally manage and update Communicator clients. Finally, Netscape Certificate Server provides a unified security infrastructure for intranets and extranets.

Application Deployment

Netscape ONE is an open application deployment platform that not only helps businesses create intranets but also lets them extend those intranets to customers and partners via extranets. With Netscape SuiteTools developers can even customize applications or integrate web technology with existing information systems.

  • The “everything service”

Here's an example of how easy it is to turn a Netscape-based intranet into an extranet: Within an enterprise, SuiteSpot lets users seamlessly access an Oracle order-tracking database and a mainframe CORBA service to retrieve and modify information. Subsets of that functionality can be externalized and delivered to anyone connected to the Net, regardless of which type of access device they are using. In contrast, Microsoft's approach depends on DCOM, which cannot access Oracle's databases on Unix machines or mainframes. Even Microsoft's client-side development depends on proprietary COM objects, which require the latest versions of Windows.

  • Make stuff as seamless and easy to use as possible

  • Acknowledge competitors (if you say you don’t have any competitors you’re either lying or haven’t done the research; contrast their capabilities as a way to make yours shine even brighter

Because enterprises need both simple connectivity and complete commerce solutions, Netscape has teamed up with General Electric Information Services (GEIS) to form Actra, a joint venture dedicated to creating leading electronic commerce products. The CommerceXpert software family developed by Actra offers a full set of Internet commerce applications. ECXpert, the commerce line's foundation, provides such functionality as electronic data interchange (EDI) over the Internet or over private value-added networks (VANs). Other ECXpert features include a translation engine to insert and extract data from legacy systems, a secure message exchange framework, and over-the-wire transaction coordination and auditing.

  • Understand that you can’t do everything; choose partners wisely to make up for your own deficiencies

SellerXpert provides an out-of-the-box business-to-business selling system that uses EDI technology for order management via the Internet. BuyerXpert, an Internet procurement system, works in a multivendor, business-to-business environment. PublishingXpert and MerchantXpert allow retailers to build personalized Internet storefronts.

  • Location, location, location? How about personalization, personalization, personalization. Today, everything is about personal branding, whether you’re in marketing, finance, venture capital, anything.

  • Help people create businesses, differentiate themselves, and reach wider audiences.

Once a business puts up an Internet store, all it needs are customers. Again, Netscape can help. Four to six million people, for example, visit our web site every day, most of them from a business environment. To help these enterprise customers, we created an online service called Netcenter, which links busy professionals to business services provided by our corporate customers.

  • The internet was a game changer. Instantly, no matter where you were, you could reach people all around the world. Big driver for commerce players like eBay and Amazon, and later Alibaba and Pinduoduo.

  • No more worries about local seasonality/foot traffic — it’s always 5 o’clock somewhere right?

No matter what type of network you're looking at - intranet, extranet, or Internet - the benefits of using Netscape products are considerable: First, our products offer platform independence. Second, they offer lower total cost of ownership. Finally, businesses can leverage their existing technology investments because of Netscape's open, innovative technology. Let's look at the benefits of all three for information technology managers and developers.

  • Marc clearly lays out and previews the benefits before digging in

    • As Bill Gurley says, “Tell’em what you’re gonna tell them. Tell’em. Tell’em what you told them.

Netscape Everywhere

As networks become increasingly interconnected within and outside enterprises, IT departments will be expected to support multiple platforms and technologies - servers, clients, databases, legacy systems, different security systems and directories, and new non-PC devices - often beyond their control. Netscape's unique commitment across platforms pays off time and again for IT managers, who can smoothly roll out state-of-the-art solutions on top of the widest array of existing systems - including multiple versions of Windows clients and servers.

  • EASE OF USE — interoperability and commitment to multi-platform

    • Wonder what the trade-off between multi-platform is… iMessage being on Apple products for example is an amazing example of proprietary tech

That commitment extends from our use of open standards for application development (HTML, Java, JavaScript, CORBA/IIOP) and protocols (HTTP, SMTP, and LDAP) to our support for initiatives such as 100% Pure Java and our cooperation with Oracle, IBM, Sun, Novell, and others on core-technology, network architecture, and legacy issues. You won't find these kinds of leveraged capabilities in proprietary products, especially those that require expensive upgrades to new operating system versions.

  • ^I mean’t I was wondering if there was any research/quantified results lol

For developers, we and our partners are creating component-based crossware that's easy to build and reuse with virtually any vendor or platform. JavaBeans components, for example, enable developers to quickly assemble sophisticated web-enabled applications. The components are language independent, so they can be Java components, CORBA components, JavaScript components, HTML components, or even platform-specific C++ components.

  • Again, easy for anyone to use with anyone.

Low TCO, High ROI

Total cost of ownership (TCO) includes three major elements: cost of acquisition, cost of deployment, and cost of management. The scalability, ease of use, and ease of deployment of Netscape's products offer significant ownership advantages over our competitors. And in a recent study, International Data Corporation found that the typical return on investment (ROI) for a Netscape-based intranet was more than 1000 percent.

  • TCO = acquisition cost + deployment cost + management cost

  • Ownership advantages stem from: scalability, ease of use, ease of deployment

  • Typical ROI: 1000%!!!!!! (curious over what time horizon)

Netscape's standards-based, platform-independent architectures and applications minimize costly upgrade cycles and deployment costs. Many Netscape innovations also translate into dramatic reductions in the time and expense required to administer an intranet or extranet. With our LDAP-enabled SuiteSpot servers, IS departments no longer need to maintain redundant multiple directories. Neither Microsoft nor Lotus has a shipping LDAP directory. Even after they ship one, they'll still need to retrofit their servers to be able to plug into an LDAP infrastructure.

  • Save time AND money

  • Lol Microsoft and Lotus really missing out. LDAP is a game changer

  • Focus on highlighting your strengths and contrast those with your competitors’ features or lack thereof

Real-World Innovation

Rather than focusing on reinventing a specific operating system, at Netscape we're inventing the Internet. We've built our business around innovation - without making obsolete the standards businesses depend on. And we have a history of attracting people who know how to make Internet technologies relevant to businesses, from Jim Barksdale, our president and CEO; to the original NCSA Mosaic browser team I worked with, who went on to develop Navigator and Communicator; to Eric Hahn's Collabra messaging team. Consider this sampling of groundbreaking Internet pioneers now at Netscape: Kipp Hickman and Taher Elgamal, inventors of the Secure Sockets Layer; JavaScript inventor Brendan Eich; LDAP pioneer Tim Howes; and IMAP4 innovator John Myers. These engineers and many others are leading our ongoing efforts to produce new products that anticipate our customers' real-world business needs.

  • Focus on the problem at hand — Internet vs Operating System

  • Build your business around innovation (reminds me of Elon) without making obsolete the standards businesses depend on (lol maybe not so much Elon anymore. SpaceX and Tesla are fascinating case studies in terms of how they’ve affected their competitors and partners)

  • Attract talented people — on all facets

  • Be ahead of your customer — Steve Jobs’ line on people not knowing what they want until you show it to them

  • Solve REAL problems

Wrap-up

If you’ve got any thoughts, questions, or feedback, please drop me a line - I would love to chat! You can find me on twitter at @kgao1412 or my email at kevin@12mv2.com.

All compilations here.