A Glance at the Internet's Future
The Internet today provides the world with a new kind of broadcast medium there for the
asking. The Internet functions outlined in this chapter provide very powerful communications
tools that you can use right now to market products and services as well as learn more about
your customers. Today, the Internet's most popular feature is E-mail. The power to do much
more is sitting there today, and we are all slowly but surely learning how to use it. If you are a
publisher, you can distribute your books in electronic form over the Internet. If you're a radio
talk show personality, you can record a radio talk show, convert the recording to a computer
file, and distribute it over the Internet. The possibilities are endless, and it's really the
combination of the computing power on our desktops and the communications power of the
Internet that has captured the imagination of so many people.
And while there is plenty of marketing you can do over the Internet today, the future of
the Internet holds even greater promise. I expect that the Internet will evolve the same way
the television industry evolved in the 1950s and 1960s. In those days even television was
alien, boring, and difficult for many folks to understand. Now we all have a remote control
unit in our homes, and the trusty TV has become like a member of the family. I believe the
Internet is now in the early stages of a similar adoption cycle. There will always be companies
busy developing completely new ways of using the Internet, continually making it more
user-friendly as Microsoft and others market newer and better Internet software. A good
example of this is the Mosaic Windows browser that was just recently introduced and is
already being used by millions of people to view the World Wide Web, the most graphical of
all Internet systems. As these highly creative and technical people put their talents together, as
happened with the TV industry in the 1950s, we will start to see the full potential of the
Internet.
Someday, using the Internet will be as easy as sitting on your sofa using your remote
control to flip through channels or "channel surfing" through its many services. We can do
some interesting things with this power, such as show graphics and sell products, but the real
potential will come when we are all glued to our monitors the way we are all glued to our TV
sets. I believe this is where our entertainment as well as our information superhighway is
going. To coin a phrase as well as to better grasp this potential, one might call it the
"infotainment superhighway." If youstart working on the Internet now, you will be better
positioned to effectively use new Internet capabilities as they arise.
What About the Popular Online Services?
CompuServe, America Online (AOL), Prodigy, DELPHI, and the new Microsoft Network
are the most common examples today of online services. These companies have built their
own private networks and provided functions analogous to many of those on the Internet.
Some of the services the online services provide are very much the same as what you find on
the Internet. On all online services, you can do E-mail with other members, access all kinds of
reference material, participate in the equivalent of Internet newsgroups (called forums), and
even see some graphical representation such as charts and pictures. Graphics are limited on
most online services. AOL is ahead of the graphics game. Prodigy uses its online
advertisements, which help defray the costs of bringing their services to members.
Although these online services are not directly part of the Internet, they could be
considered kissing cousins because they provide similar function and are connecting their
users to the Internet more and more. In fact, the boundaries between online services and the
Internet are rapidly fading as most of the services continue to bring limited Internet service to
their members. Most of the online services, for example, already exchange E-mail with
Internet users. America Online was among the first to offer access to the Internet newsgroups
and Gopher services as well. In fact, all of the most popular online services have announced
future plans to provide full access to all Internet functions in the future, and many are already
doing so.
At the time of this writing, there were approximately 7 million people who use one or
more of these online services. These online services provided a very worthwhile service for
their members and that they will continue to do so for at least a few more years, but unless
they are merged seamlessly with the Internet, I believe they will not survive. The reason is
basic economics. Will the average consumer be willing to pay $15 to $20 per month each for
two or three of these services and another $15 to $20 per month for an Internet account?
Probably not. Something will have to give somewhere.
Indeed, the online services seem to agree with this economic analysis, because they have
all publicly announced recently that they not only intend to bring more Internet services to their
members, but they are also aiming to service a niche market. For example, Prodigy plans to
concentrate more and more on using technology similar to the blocking of adult movies on
cable boxes, so that families may subscribe and not have to worry about what little Johnny is
reading on the Internet. With the adult services on the Internet blocked out, Johnny can only
do what Mom and Dad have planned for him. This could well be Prodigy's main market
position, unless they come out with other major services soon. It's a particularly difficult one
to understand when you consider that Prodigy has so much invested in shoving advertising at
their subscribers. To me, this strategy conjures up images of Saturday Morning TV. America
Online (Figure 1.6) is preparing to give its members more and more of a graphical feel to the
Internet, even claiming to be developing multimedia (video, hypertext, sound, etc.) for their
members' use. CompuServe will continue to develop as a business-oriented interface to the
Internet perhaps even providing the only way to safely transfer funds between buyer and
seller. DELPHI intends to provide their subscribers with proprietary databases and other
kinds of special interest information to keep their membership rising.
Microsoft has also announced a new online service called Microsoft Network. This could
be an extremely interesting service to subscribe to because, since it comes from Microsoft
itself, you might see the best graphics, the best video and multimedia, more technical support,
many more information providers, better access to Microsoft upgrades, and so on. As of this
writing, no one (not even Microsoft) knows for certain what services will be offered on the
Microsoft Network or how popular it will be. However, my feeling is that the Microsoft
Network will gain millions of subscribers when they open for business in 1995. Windows 95
will also have a Microsoft Network connection built in.
I still feel that whatever Microsoft Network provides, the same things will be available
directly over the Internet (don't forget that Windows 95 also has a built-in Internet
connection), so the marketing strategies of all the online services are tenuous at best. The
future will open up many opportunities, however, and it's not inconceivable that the online
services will be able to change their marketing strategies and carve out their own niches for a
long time to come. I hear from many people that after they open an Internet account and they
learn how to use the World Wide Web, they find it hard to go back to CompuServe,
America Online, Prodigy, DELPHI, and the others, mainly because of the expense. The
online services never really became popular until they were able to bring the ease of use of
Windows and the Macintosh to their subscribers, so it is easy to understand how Internet
could eventually attract members away from these online services, even though currently they
are all growing and evolving rapidly.
Since there is no single provider or administrator, the Internet has the disadvantage of
lacking a large source of capital or a focused committee of experts to guide its development.
One could regard this as the cup being either half full or half empty. I feel that the freedom
afforded by the lack of a central controlling body gives the individual entrepreneur more
power and that this will offset the advantage afforded the online services by their funding and
their organized bureaucracy. Of course, only time will tell.
In summary, the Internet is like the early stages of the universe forming from vast diffused
gases blown out of a central Big Bang. A few galaxies have already formed, but there's room
in this rapidly expanding universe for many, many more. But what happened before the Big
Bang?
What About Bulletin Board Services?
Another way computer users share information is through bulletin board services (BBSes). I
am going to include them in our online marketing discussions because they are still a very
viable way to market your products or services electronically. I am speaking about the BBS
networks, of course. Most BBSes were started about 10 years ago (some go back as far as
15 years). Before BBSes, many computer hobbyists who wanted to communicate with other
similarly interested parties would tinker together some software that would allow them to
connect their computer to the phone lines. They could then communicate with other computer
hobbyists around the world. This was like ham radio at this stage. There might have been a
couple thousand people in the beginning who wanted or needed to talk to each other via their
computer instead of their telephones. Over time, these computer "nerds" worked on ways to
make this form of computer to computer communication easier, and they even found ways to
let dozens of people call up their computers at the same time. This was the birth of BBSes.
Very quickly, these people learned that they had a new medium for transferring computer
information around the world via the phone lines. They developed more advanced bulletin
board systems, and some of them got rich selling the programs necessary to set up a BBS or
use a computer.
The BBSes usually were geared to special interests. Some hobbyists would be interested
in farming, and so they would set up a farming BBS. Others might be interested in dating, so
they would set up a dating BBS. Most were interested mainly in computers, so they used
BBSes to transfer computer programs around to other computer users. This became a new
industry referred to as shareware. As more and more computer "nerds" dialed up these local
BBSes, they would find a program that would help them invent other programs for other users
and this process created thousands of amateur, and even some professional, programrs.
Some of these early BBS administrators were so successful that they soon had to add
dozens of phone lines to their homes. From there, some of them were smart enough to go into
commercial buildings and install hundreds of phone lines to handle the demand for their
services. The biggest and best BBSes today, such as EXEC-PC and Channel One, are very
profitable. Of the 60,000 to 75,000 BBSes in existence today, however, only a small
percentage are profitable. Most are operated as a hobby in the garage or bedroom with only
one or two phone lines.
The shareware industry grew and grew via these bulletin boards because it was a natural
way to distribute software to other people. Even if you had a small BBS in your garage, you
might still have a subscriber base of callers numbering in the hundreds or even in the
thousands. This was ideal for shareware programrs, because if you got your program into
one BBS, another BBS operator would dial up and copy your program into his BBS and so
on and so on, until thousands of BBSes might have your shareware program sitting on their
hard drives and available to hundreds of thousands of people overnight.
Few of these shareware authors made any money, however, because their marketing
skills were extremely limited. They literally gave away billions of dollars worth of product over
the years. A few of the smarter ones went on to become multimillionaires. Peter Norton's little
shareware company, Norton Computing (you probably have a Norton product such as
Norton Utilities or Norton Desktop on your computer's hard disk) was eventually sold to
Symantec Corporation for about 30 million dollars. Most did not do as well.
There are still smart marketers on the shareware trail even today. A new company called
Apogee, started by two brothers a few years ago, is now about to be listed on the stock
exchanges because their Shareware game, Wolfenstein 3-D, is selling millions of copies. The
difference here was the design of the game. It's very well done, with fantastic 3-D graphics
that make the game players feel as though they are really part of the scenery. The object is to
escape from a German WWII prisoner of war camp. It s a shoot-em-up in the best tradition
of arcade style games. The first level is given away freely, but as users become addicted to it,
they are encouraged to purchase upper levels of the game, where you eventually track down
and kill Adolph Hitler. An average user can find the free game easily on any one of the
60,000 BBSes around the country. After the first level, he might spend a hundred dollars or
more buying the rest of the game.
This was marketing genius at its best. The Apogee founders realized that within the
shareware network of thousands of these bulletin boards, there was a marketing and
distribution channel just waiting for their products. Theproblem was that they had to give their
program away to convince the many BBS operators, called Sysops, or system operators, to
accept the program for their own subscribers. The key was to develop upper levels to their
game that was advertised in the first disk. This way, if you liked the game, you would see the
advertising on your free disk, and a percentage of players would order the rest at normal
pricing for software of this kind. It works in many shareware situations similar to this.
Most shareware authors are not able to make an upper level, or secondary program with
as much power or added power as their first free disk, and this presents them with few sales.
Most shareware authors are barely compensated for their time in developing their programs.
This is due to a lack of marketing savvy in most cases. In my opinion, a vast majority of
shareware authors could make a profit if they spent as much time planning their marketing
strategies as they do on their program itself.
Unless you have a shareware program, BBSes have not traditionally allowed for any real
marketing excitement, but that is changing all the time. BBSes should not be ignored, because
they are destined to become a full part of the Internet and will thus provide another vehicle to
spread your marketing message far and wide.
Even now, with the advent of the electronic book, new BBS marketing opportunities are
presenting themselves. When I saw the shareware industry developing all around me, I
decided to experiment with electronic books. I have dubbed them verbons, because they are
a new technological hybrid between normal text or "verbiage" and online forms of
communication. Hence the term "verbon." You may be reading this book in verbonic form or
you may have the print copy, since it is available in both forms. If you are reading this book
on your computer screen, you have the verbon.
In the early days of electronic publishing I was forced to give my E-books away and
advertise in the book other books of mine that the reader could order. This system met with
very limited success because it is not easy to convince people to buy a book when you have
already given them one for free, yet many thousands of people did buy one or another of my
electronic books. Distributing E-books over the BBS networks has become more and more
profitable for me and my publishing company. However, I don't recommend this to anyone
who is not seriously committed to publishing because it is not likely that you will make a
significant amount of money from one title. If you have the expertise or the friends to produce
a collection of books, there is a greater chance you can make money marketing via the BBS
networks. I now have hundreds of authors sending me their books to be published by my
company, and just a few years ago I was sending my books to publishers trying to get them to
publish mine. The good news is that the BBSes are now just one of the major ways to
distribute shareware or commercial programs. This means that the opportunities for
programrs and E-book publishers are expanding rapidly. Today, you should consider
publishing to the electronic community via the BBSes, the online services, and the Internet
because of several developments that continue to make it easier and easier to sell electronic
publications and shareware.
First, with the sale of more and more computers and modems, more people are getting
online every day. They have to go somewhere with all this hardware if they want to get the
most for their money. BBSes and the Internet are still evolving to accept this wave of
interconnectivity.
Second, more and more computers are becoming small enough to be carried to school, to
the beach, to theback yard, to the office, and home. This means that computer users are more
and more likely to read an E-book on their way home, at the beach, or even in bed.
Third, multimedia developments make it more and more acceptable to have your ideas
presented in a format that is more than a print book and different from a TV show. The
majority of people who buy computers for their home are doing so to help educate their
children and to have a facility for learning what TV does not offer.
If you are a big commercial company developing software, you already know all this and
you have already begun to market to this community. The small company just starting out
should also utilize the BBSes and online services and the Internet to market its products with
very little investment. With a little luck and a good product this successful experience can be
leveraged up to a real commercial success. The example of Peter Norton is one that can be
copied thousands of times in the future, and it should be easier and easier to do so, since
Peter Norton started out with a total potential market of just a few million computer nerds.
Today there are millions of ordinary folks to market to.
