Netscape's search engine will team with Qwest Communications to offer voicemail, fax, and conference call scheduling. It's the latest surge in the race among search engines to offer the most Web-based gadgets.
As part of a US$25 million alliance announced Thursday, Qwest and Netscape also will swap telecommunication services and marketing exposure. Under the three-year agreement, Netscape's Netcenter will get access to Qwest's high-capacity, high-speed fiber-optic data network. In return, Qwest will get the chance to sign up new customers from among Netcenter's 8.5 million visitors. The companies didn't specify how the $25 million kitty would be split.
In recent months, search engines like Yahoo, Excite, and Netcenter have been stockpiling features like free email, chat, and comparison-shopping agents to complement their core searching services.
The companies are trying get Web surfers to stick around their sites longer, in an effort to generate more advertising revenue. Several search engines have already signed up with AT&T in Internet access partnerships.
"The difference here seems to be that Netscape's link to its telco partner Qwest will be more integrated than most," said Danny Sullivan, editor of Search Engine Watch in London.
Netcenter will create a new spot on its site called Netscape Contact. Through Contact, users can set up a universal inbox where they can keep an address book, check email, and send faxes. Contact also will let users reserve Qwest-carried conference calls through their browsers. The voicemail feature will notify users via email when they have messages waiting. Qwest customers can also check their monthly bills through Netcenter.
As part of the agreement, Qwest will provide Netcenter with an OC12 data line, capable of transmitting roughly 20 copies of Moby Dick per second. The new line will quadruple Netcenter's current capacity, the companies said.
Both companies said the agreement likely will draw new customers. Communication services like Webmail and chat account for about a third of Netcenter's registrations, said Tom Tsao, senior program manager for Contact. And Qwest CEO Joe Nacchio said the deal is an "important step to drive consumer and customer acquisition" for his company.
Netscape (NSCP) closed down 94 cents to $22.38, while Qwest (QWST) fell 44 cents to $32.50. Both trade on Nasdaq.
Some of the Netscape Contact services will be available by the end of the month. Contact also will be a centerpiece of a new business-oriented version of Netcenter scheduled to be unrolled in about 60 days, said Mike Homer, Netcenter's general manager.
Analysts said the arrangement could be a boon for Qwest. The kind of services that Qwest offers would appeal to a lot of Netcenter users.
Denver-based Qwest is building a fiber-optic telecommunications network based on Internet telephony, the same technology that shuffles email around the Internet. Because the network would theoretically use resources far more efficiently, Qwest would be able to offer long-distance voice calls and data services more cheaply than traditional rivals.
Qwest's acquisition of LCI Communications last fall made it the fourth-largest long-distance carrier in the United States, with anticipated revenues of about $3 billion in 1998. It expects to complete its 18,000-mile, pure-fiber network by the summer of 1999.
Until now, Qwest has mainly chased big businesses with sprawling operations as customers. Netcenter could help it attract more mainstream customers, analysts said.
Claudia Graziano and Sean Donahue contributed to this report.
