Netscape Communications Corp - Involved In Other E-commerce Initiatives

INVOLVED IN OTHER E-COMMERCE INITIATIVES

Netscape also was involved in other initiatives that helped the development of e-commerce. One problem hindering such development in 1995 was the lack of a secure payment system that would enable customers to make credit card payments over the Internet. Netscape joined forces with MasterCard to develop the Secure Courier encryption standard, while Microsoft and Visa developed the Secure Transaction Technology. Netscape teamed with Verifone, the largest credit card transaction processor, to develop a credit card payment system for the Internet using the Secure Courier technology in January 1996. Netscape was all too aware of security issues, having suffered a security breach in September 1995 when two hackers at the University of California at Berkeley cracked the security code in Netscape Navigator. Netscape corrected the problem and posted warnings on the Internet. The company also established a "Bugs Bounty" program, giving prizes to users who identified flaws and potential security problems with the browser.

In 1995 and 1996, Netscape also entered into several strategic alliances. America Online (AOL), the nation's largest provider of online services, agreed to offer improved Internet access by using Netscape Navigator. Both Netscape and Microsoft worked with Hewlett-Packard to develop a Hypertext Markup Language (HTML) that could be printed as seen on screen. Netscape also worked with Sun Microsystems Inc. on the development of JavaScript language, which allowed programs to be imbedded in Web pages.

Netscape was expanding its technological base by acquiring other software companies. In January 1996 it acquired software developer Callabra Software Inc. for $108.7 million. Callabra's main product was Share, a system that enabled simultaneous e-mail discussions and document sharing among network users. In February 1996 Netscape acquired Paper Software Inc. and its 3-D programs for the Internet. During 1997 Netscape improved its position in the business software market by acquiring Digital-Style, which made Web graphics tools, and Portola Communications, which made messaging systems.

In 1996 and 1997, Netscape continued to form joint ventures. Actra Business Systems was created by Netscape and GE Information Services (GEIS) to develop e-commerce software. Netscape bought out GEIS' interest in November 1997 for $56.1 million and assumed full ownership of Actra. Together with Novell, it established Novonyx, and Netscape and Oracle formed the joint venture Navio Communications Inc. to produce consumer-oriented Internet software. Oracle purchased Navio from Netscape for $60 million in May 1997.