Making The Web Look Like Television   

Is that the key to attracting more online ads?

In a second major face-lift in 18 months, giant Microsoft is abandoning its Net server to remake web viewing as we now know it. The world's largest computer company is junking its failed online rival to Netscape in favor of Active Desktop, which will attempt to look like NBC, CBS and Fox.

This bold experiment will seek the answers to such fundamental questions as: Will computer use become more like watching TV? Will Microsoft control a major advertising medium rivaling television and newspapers?

By creating a new style of Web entertainment, the Redmond, Washington, colossus is betting that its milder version of interactivity will, via the remote control, appeal to that three-quarters of the mass audience that seem uninterested so far.

In particular, the new Microsoft TV-style Active Desktop will seek to tempt the mass public to try "owned and operated" ventures such as the online political magazine Slate, a travel channel/service called Expedia and CNN-clone MSNBC, as well as Retrospect 360, a historical channel, the Broken Line, a combination travel game/ scavenger hunt, and Rifff, a "chat room" where popular musicians talk to their fans.

This experiment will not be cheap. Gates and company publicly talk of spending at least $400 million each year – with little hope of a payoff before 2000.

But when the new millennium begins, Microsoft sees itself alone atop the new world of the TV-Web, as dominant in the world of new media as it has been with the personal computer.

Since this venture will cost so much, Microsoft has to cut back on other plans, such as expanding into every country in the world. Where it once planned for its Microsoft network to be available in a dozen languages, Microsoft has quietly backed down to only English.

To make their channels look less like today's Web sites and more like TV networks, Microsoft plans to create alluring advertisements and program content.

That something this bold is being attempted seemed inevitable since the leading traditional service, America Online, has never made a profit even with its more than seven million paying customers. Indeed, America Online has quietly begun to reinvent itself, not content to sit by and watch Bill Gates take over again. AOL's model is also television, but in this case cable television. AOL has promoted itself to Wall Street, saying it plans to look more like a niche cable TV network of the 1980s than an online service of the 1990s. To accomplish this, it has gone as far as hiring Bob Pittman, the force who made MTV a household name a decade ago, to run one of its three new divisions.

Microsoft and AOL have one important concept in common: Both want to move from a world that relies on subscriber fees to one that gains the bulk of its revenues from advertising.

For both Microsoft and AOL, significant problems remain. More households must buy computers, and acquire and use modems. Today only a quarter of the nation's households are so equipped.

Broadcast television and cable TV both tapped Hollywood producers who might be looking for outlets for their talents. Where will the hours of tempting content come from for the new Web channels? And more important, what content will work for advertisers?

Despite the Internet's rapid growth in popularity, it is still unclear if it will be a profitable business venture. Pay per use has failed. AOL proved that.

The "one fee for unlimited use" (usually $19.95) will be abandoned as customers look for services without eternal busy signals. Internet companies realize they won't make money if it takes customers hours to get online because of online traffic jams.

Thus we come to an experiment with television-like advertising that simply seeks to reverse Web use as we have come to know it. Hoping to provide advertisers with a quantifiable audience, Microsoft wants nothing to do with past Web surfing: nerds trolling through seemingly limitless data to "pull up" information they're looking for.

Now Microsoft is gambling it can "push" highly customized information and entertainment directly to personal computers, sending out content on a regular basis to subscribers. Tellingly this past December it allied with the hot new name in "push" delivery, PointCast, which delivers news and 30-second spots.

Under their agreement, a PointCast "channel" will appear on the screen of computers using the newest version of Windows to be rolled out in June. Among the news organizations already signed up: the New York Times, CNN, the Boston Globe and MSNBC.

All seek to establish continuous relationships with online customers, to replace the Web browser with the remote control, and to finally embrace a business model that will remake the Web into a force in the world of mass advertising.

The winners could become very rich. l