Altavista Co - History

HISTORY

When DEC was absorbed into Compaq Computer Corporation in 1998, AltaVista became a division of Compaq. Instead of selling off AltaVista, Compaq invested more money in it. By the end of 1998 Alta-Vista had a user base of 12 million people and 32 million page views per day. With its core strength of extraordinary search technology that generated results faster than most other search engines, AltaVista's goal was to become one of the top five sites within three years. Its principal competitors at that time were Yahoo!, Excite, and Lycos. AltaVista was generating about $50 million a year in revenue, primarily from banner ads on its site.

In early 1999 Compaq spun AltaVista off into an independent company. Rod Schrock, senior vice president of Compaq's Consumer Product Group, was named president and CEO of AltaVista Co. In January 1999, he announced: "We're going to design e-commerce into the very fabric of AltaVista." Alta-Vista got a boost from Microsoft Corp., a longtime partner of Compaq, with the addition of Microsoft's HotMail e-mail service. Microsoft also said it would provide future instant messaging technology to Alta-Vista and that AltaVista would replace Inktomi Corp. as the search engine for the Microsoft Network (MSN).

Compaq added shopping capabilities to Alta-Vista in early 1999 with the $211 million acquisition of Shopping.com, an online retailer that offered more than 2 million products over the Internet. Compaq also acquired Zip2 Corp., a company that specialized in providing directory and database services for newspapers. Zip2 Corp. had 160 media partners—newspapers for whom Zip2 put their content and advertising into an online, searchable format. AltaVista planned to combine Zip2's directory and database features with the e-commerce capabilities of Shop-ping.com and to give local merchants access to the features of Shopping.com through the Web sites of their local newspapers. The Houston Chronicle's Houston4U.com Web site was showcased as an example of how AltaVista's local portals would work.