The announcement Monday by Netscape Communications Corp. [NASDAQ:NSCP] and Oracle Corp. [NASDAQ:ORCL] that they are merging affiliated companies to work on creating software for open standards-based network computers (NC) and appliances did not come without a slap at Microsoft.

Netscape and Oracle will merge their respective companies -- Network Computer Inc. (NCI) and Navio Communications -- into one concern in the NC arena under the NCI name.

That their combined technology supports open Internet standards and development languages -- Java and hypertext markup language (HTML) -- is a source of distinction from Microsoft. NCI executives see Gates and Company as their closest competitor, but with development philosophy very distant and distinct from their own.

"It was very easy to merge these companies because NCI and Navio are and have been bundling technology based on open standards," said Larry Ellison, chairman and chief executive office of Oracle as well as a member of NCI's board of directors. "Therefore, it was relatively easy technically, culturally, and philosophically to merge the companies. I'd like to contrast this with Microsoft's acquisition of WebTV, which is totally based on proprietary technology."

There have been a host of small players in the network computing market, but NCI officials do not regard them as serious competitors, because they fail to offer a complete "solution" for the network computing market.

"The network computer needs a network. The network needs server technology," said Ellison. "You make a mistake by reducing this to either the appliance or client side of the business. You need an end-to-end solution. None of the companies provide any of them. What NCI offers is a single software standard for a family of low cost appliances.

"We think it's very important to have competitors in this business," said Ellison." We think choice is a good thing....We don't like proprietary technology. WebTV is not an open platform. It is a wonderful implementation, but it is a proprietary product."

Among the software under the new NCI umbrella is the Navio product family. These products are based on Netscape Navigator and are designed to bring Internet technology to both the consumer and non-PC markets. NCI software products are designed to build and deploy network computer systems to homes, schools, and corporations.

Several companies have taken the open standard tools and created their own products, including NetChannel, a company self-described as a "television service provider" that is giving clients television-centric information services.

"We've also embraced that open standard, but NetChannel is platform agnostic," Jim Gustke, director of marketing for NetChannel said. NetChannel products will be distributed through RCA devices, probably in the second quarter of 1997. "We can be delivered to a variety of platforms -- NC first and foremost. We have had, and will continue to have, a relationship with NCI. NCI gives us that many more options to create a dynamic service. What that means to consumers is that they will have a more robust, TV-like experience."

As for WebTV and its locked standards counterparts, Gustke says, "I think history shows, proprietary platforms don't last for the long run."

NCI executives say there will be a host of NC consumer products available on the market before year's end. The timing will be such as to take fullest advantage of the Christmas selling season.

The newly formed NCI will combine the engineering, marketing, technology, brands, and products of Navio-NCI under the NCI name. Jerry Baker will remain chief executive officer. Wei Yen, president and chief executive officer of Navio, will be president of the new company. Jim Barksdale, Netscape president and chief executive officer, and Ellison, along with Baker and Yen, will serve on NCI's board of directors.

Source: Newsbytes