Walt Disney Co - Portal Strategy For E-commerce, 1998-2001

In 1998 Disney acquired a 43 percent interest in Internet search engine InfoSeek, with an option to purchase the rest of the company. At the time media companies in general were looking for ways to achieve a dominant presence on the Internet. NBC had just paid $38 million for a 19 percent interest in Snap!, an Internet portal owned by CNET. Later in the year America Online acquired Netscape Communications and its popular NetCenter portal. As part of its $472 million acquisition of InfoSeek, Disney paid $70 million in cash and turned over ownership of Starwave to InfoSeek. Disney would regain ownership of Starwave when it completed its purchase of all of InfoSeek in 1999. Disney also committed $165 million to provide promotional support for InfoSeek.

Disney's acquisition of InfoSeek was part of its strategy to distribute its content over all available media. Toward the end of 1998 Disney, InfoSeek, and Starwave introduced a new Internet portal, Go.com, in a beta version for consumers, followed by the official launch of the Go Network in January 1999. The home page of the Go Network resembled that of Info-Seek, but it was easily customizable. Content was organized into five major sections, which were accessible through page tabs: a sports area featuring ESPN.com; a news section featuring ABCNews.com; an entertainment area that included ABC.com and MrShowbiz.com; a family and kids area featuring Disney.com; and a personal finance section.

The launch of the Go Network in 1999 was supported by a national television advertising campaign that ran in 14 major markets. At the time of its launch, the Go Network had 20 million unique users, with 8 million of them registered. Following its launch the Go Network added Go Shop, an e-commerce site that featured more than 200 merchants, and Go Games, which offered a variety of individual and multiplayer games. In March 1999 Disney redesigned its Disney.com site, creating 12 content channels and merging its subscription-based Blast Online for kids into Disney.com. With about 80 percent of the new Disney.com content available for free, subscribers could join Club Blast for $5.95 per month or $39.95 per year and gain access to premium content, including the Disney BlastPad, a proprietary kid-safe instant messaging service that parents could control, and the Mouse House Jr., an area designed for children too young to read.

In mid-1999 Disney decided to acquire the remaining 57 percent of InfoSeek for $1.62 billion in stock. It created a new tracking stock company, Go.com, that incorporated InfoSeek, the Go Network, and Disney's Buena Vista Internet Group. When the purchase closed in November 1999, the transaction was valued at $2.15 billion.