Netscape Unveils Small Biz Service

America Online (Nasdaq: AOL) said Wednesday it will launch a free portal aimed at helping millions of small businesses get online and use the Web for advertising, selling and gathering information.

Offered through AOL subsidiary Netscape, Netbusiness will be made available across a host of AOL-owned sites, including Netscape's Netcenter, AOL's WorkPlace Channel, Digital City and Compuserve.

AOL said the service will target the 28 million U.S. businesses, according to the U.S. Small Business Administration, that have fewer than 10 employees. Those businesses, AOL noted, are a force in the American economy, employing more than half of the private workforce and accounting for nearly half of all annual domestic sales.

By 2002, 85 percent of small businesses will conduct all or part of their business over the Internet, according to the SBA.

Reluctant Market

However, by focusing on small businesses, AOL is taking aim at a market that has exhibited mixed feelings toward the Web in the past. A study released in July by Arthur Andersen and National Small Business United found that while 71 percent of the companies surveyed were either on the Web already or planned to be in the next 12 months, only 58 percent expected e-commerce to affect their business.

More than half the companies surveyed said they did no business over the Internet and did not plan to start in the next year.

Despite that reluctance, small businesses have not been ignored online. Microsoft's (Nasdaq: MSFT) bCentral.com and Work.com, a joint-effort between Excite@Home and Dow Jones & Co., both target the same markets. In July, Excite@Home launched "Freetailer," a free online storefront service, and signed up more than a thousand e-tailers within 24 hours. Yahoo! also offers a small-business service.

AOL apparently believes that by making the service both easy and free, it can attract even the most resistant business owners.

Ad Driven

AOL said the sites will be free of charge to all users and will be supported exclusively through advertising revenues. Companies can create "online storefronts," putting information about businesses on the Internet and providing e-mail and instant messaging services.

The centerpiece of the service is a "Netbusiness card" that serves as a gateway. By customizing the card, businesses can get free listings in AOL's yellow pages and become part of a network of businesses.

The card also includes "My Life" and "My Industry" buttons that will offer links to Web sites of interest in those categories.

Networking Possibilities

"Users will now be able to track key trends, network for leads, market and sell on the Internet, find the best deals on supplies, stay in close touch with customers [and] consult directly with experts," Singer said.

The service also includes news, research and advice features; management tools such as an online calendar and a customizable business version of AOL's Instant Messenger, and a shopping center that provides pricing for office products.

Several Partners Lined Up

Several partners will help market the service, including FedEx Corp., Kinkos.com, job search site Monster.com, Stamps.com and OfficeDepot.com, which will distribute free CDs that include browser software that takes users directly to the Netbusiness registration site.

AOL acquired Netscape in late 1998 in a deal worth $4.2 billion (US$).