Written by Ian Peter
(with thanks to the excellent Wikipedia article on the same subject)
By mid-1995, popular culture had begun to notice the web, and Netscape Navigator
was the de facto standard for web browsing at that time. An ex-colleague of Tim
Berners-Lee called Mark Andreesen founded the Netscape Corporation, which built
on the previous Mosaic browser to establish the first mass-market browser, the
Netscape Navigator.
In August 1995 Netscape became a public company, fuelled by the success of the
world wide web, and, to many minds ushered in the Dotcom boom (see our article
here which traces the dotcom bubble to earlier
non-Internet origins, however)
To that point of time, Microsoft had thought the future action would be in multi
channel interactive cable television. However the success of Netscape caused it
to release Internet Explorer 1.0 as part of the Microsoft Windows 95 Plus Pack
in August 1995. Internet Explorer 2.0 was released three months later, and by
then the race was on.
New versions of Netscape Navigator (later Netscape Communicator) and Internet
Explorer were released at a rapid pace over the following few years. Features
often took priority over bug fixes, and therefore the browser wars were a time
of unstable browsers and lots of user headaches. Internet Explorer only began to
approach par with its competition with version 3.0 (1996).
In 1997 Netscape still held 72% of the browser market. But in October 1997,
Internet Explorer 4.0 was released and changed the tides of the browser wars. It
was faster and it adopted the W3C's published specifications more faithfully
than Netscape Navigator 4.0.
A lot was at stake for these two companies involved in the browser wars. A
popular web browser could earn a lot of money: search engine companies would bid
to be the default tool used in the web browser, and other companies with a web
presence would bid to be listed in the default set of bookmarks which was
preinstalled with the browser. Since a web browser is a powerful gateway to a
great deal of information, the company which controlled this gateway could
conceivably have a lot of influence over its users.
Microsoft had two strong advantages in the browser wars. One was simply an issue
of resources: Netscape began with a nearly 90% market share and a good deal of
public goodwill, but as a relatively small company deriving the great bulk of
its income from what was essentially a single product (Navigator and its
derivatives), it was financially vulnerable. Netscape's total revenue never
exceeded the interest income generated by Microsoft's cash on hand.
The other, more important, advantage was that Microsoft Windows had a monopoly
in the operating system marketplace that could be used to leverage IE to a
dominant position. IE was bundled with every copy of Windows; therefore, even
though early versions of IE were markedly inferior to Netscape's browser,
Microsoft was still able to enlarge its market share. And IE remained free while
the enormous revenues from Windows were used to fund its development and
marketing, resulting in rapid improvements until it was so similar to Netscape
feature-wise that users had no desire to download and install Netscape.
Other Microsoft actions also hurt Netscape, such as:
The effect of these actions were to "cut off Netscape's air supply," as
stated by a Microsoft executive during the United States v. Microsoft case
(which resulted in Microsoft being prosecuted for having used its monopoly
status to manipulate the market). This, together with several bad business
decisions on Netscape's part, led to Netscape's defeat by the end of 1998, after
which the company was acquired by America Online for USD $4.2 billion. Internet
Explorer became the new dominant browser, attaining a peak of about 96% of the
web browser usage share during 2002, more than Netscape had at its peak.
Thus ended the pioneering era of web browsers, with the dominant software
company dominating the market. Microsoft might have been a late entry, but to
this day it has remained dominant in the browser market, challenged only
recently by the excellent Mozilla browser.
Lovers of legal battles and supporters of the free software movement can see in
the browser wars classic examples of what began to happen as the Internet began
to move towards mass markets. And that move to mass markets most closely finds a
birthday in August,1995.
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