The decision by CompuServe Inc, Columbus, Ohio, to follow Microsoft Corp, Prodigy Services Co and AT&T Corp and adopt the Hyper Text Mark-up Language standard was inevitable, but what’s not so certain is how it will make money once it leaps from a proprietary to an open environment. At yesterday’s press conference CompuServe said its Internet plan – codenamed Red Dog – will result in a suite of services available via a standard Web browser by year’s end. The H&R Block spin-out says its development costs will decrease because it will be able to buy more content, instead of designing in-house, leaving it leaner, meaner and better able to adapt to its five million customers’ needs. It claims it will soon be able to bring product to market 75% faster. But the whole move is a bit of a gamble on future technology. The company admitted it’s still developing the authorization technology to monitor and charge customers when it becomes possible to access CompuServe from any Web browser at the end of the year. CompuServe says currently most of its revenue comes from subscriber fees and vows to implement some sort of transaction fee for users under Red Dog, but admitted that to keep profits up it needs more advertisers and to create more partnerships like the one it has Charles Schwab. As part of that deal CompuServe gets part of Schwab’s customer fee, similar to the way credit card companies get a cut of purchases. But CompuServe says it has no similar relationships to announce in the near future. The company thinks users are still afraid of or unable to quickly navigate the Web and will pick up new customers on that basis: People are tired of the ‘World Wide Wait,’ but CompuServe is a safe environment with a sense of community which helps people know where they’re going, the company said. However, the opposite view would suggest that as search engines become more prevalent, the Web becomes easier to navigate and users become more sophisticated, they may not need CompuServe. The company disagrees and predicts there will be enough new users to sustain its services. CompuServe will continue to support its proprietary CompuServe Information Management service for as long as there is customer interest. Over 80% of CompuServe’s future product development will reportedly be focused on developing content and services that use Internet and HTML technology and tools. CompuServe has already begun designing content in HTML and says a summer wave of new content will be followed by another in September. America Online Inc, Vienna, Virginia, is now the only large online provider which has not yet embraced HTML as its core delivery mechanism.
