Sun grabs big Netscape chunk

Say goodbye to Netscape Communications Corp. and hello to “Sunscape.”

Last month, America Online Inc. and Sun Microsystems Inc. agreed to divide up responsibility for the products of the former Internet darling. Netscape’s well-known brand name, Netcenter Web site and Navigator Web browser go to AOL, which completed its acquisition of Netscape in March.

Sun, through an unusual joint venture with AOL, gains control of Netscape’s server software and electronic commerce products — the bulk of Netscape’s software business.

Apparently, the joint venture will take over all software development of the Netscape products, except for the browser, and try to combine these with Sun hardware and software to create complete e-commerce systems for corporate customers. AOL seems to be planning to use the fruit of this development labour to create e-commerce services aimed at businesses.

That reorganization sounds fairly simple. But AOL and Sun face an array of issues, including how to handle product overlap, as they try to exploit Netscape assets. For instance, the three companies offer as many as five browsers among them.

The first step in making this still-murky relationship work was unveiled last month: creating a “strategic alliance” of some 2,000 Sun and Netscape developers and managers.

But many questions remain. Which company will run this organization? Who will support the products? Are the companies going to create code to integrate products or merely bundle them?

“The press accounts about this new strategic alliance are confusing,” said Eric Brown, senior analyst with Forrester Research in Cambridge, Mass., who has additional questions. “Where does the money come from? Where does the revenue go? Who has the power to hire and fire? What is this?”

Whatever this joint venture is, it seems clear that Sun is in control. Sun’s Mark Tolliver, formerly head of the company’s consumer and embedded systems division, is president and general manager of the new group. Barry Ariko, who had been a Netscape senior vice-president, is Tolliver’s deputy general manager.

Ariko wears another hat: He’s also AOL’s senior vice-president of the new Netscape Enterprise Group. According to an AOL press release, this group “will continue to serve Netscape’s enterprise customers” as well as “contribute” to the alliance. That statement sounds like the new group will be a support organization, but AOL didn’t release any details.

Based on the three-way deal, Sun is now able to offer its Solaris servers and Java technology alongside Netscape’s products: Web, e-mail and directory servers and the ECXpert line of commerce tools. How, or whether, the Sun-Netscape alliance will knit the products more tightly together is another key issue neither company has addressed.

Sun apparently hopes to offer these products running on its Solaris servers and other systems software, and to create a complete, ready-to-roll e-commerce line.

One conflict Sun hasn’t resolved is whether the company will promote its own application server, called NetDynamics, or Netscape’s, called Netscape Application Server (formerly Kiva).

Sun is likely to push hard to expand the use of Java technology in the Netscape products, especially the Enterprise Java Beans (EJB) specification. EJB is a standard way to write interoperable, reusable server-based software components. “If these products are not up to snuff [with EJB support], then rivals like BEA Systems or IBM could take the premier space in the Web application server market,” said David Sonnenschein, director of Internet consulting at Metamor Consulting Solutions in Dallas.

AOL is still silent on what it will do with the Netscape Navigator browser. AOL said it will release Version 5.0 later this year, but the firm’s focus seems to be in two areas. One is aiming a browser at the burgeoning market for handheld wireless devices. A second plan is to embed a browser directly into AOL or AOL-built Web sites, creating a browser window that’s optimized specifically for those sites.