It was with the World Wide Web that the Internet broke into national consciousness and where Netscape Communications would become the central Bay Area firm around which a slew of new Silicon Valley companies would form. But unlike Sun, which rode public UNIX standards to rapid growth, Netscape began its life with a direct assault on the original government-based standards created by the National Center for Supercomputing Applications (NCSA). In this, Netscape would play a three-cornered game against both the NCSA and Microsoft, who it knew would quickly be coming in with its own controlled standards. Netscape's success would be based on the virtual withdrawal of the government from any serious intervention on behalf of Internet standards.
The initial Web "browser," Mosaic, was created at the University of Illinois at Champaign-Urbana where the National Center for Supercomputing Applications (NCSA) was located. The National Science Foundation had officially funded the NSFnet "backbone" of the Internet to link five major supercomputing centers, including NCSA, and NCSA's software development group had concentrated for years on high-performance information-sharing and collaboration software. Even before Mosaic, the NCSA had back in 1985 created software "clients" for PCS and Macs, called Telnet, to allow people to access and use computers connected to the Internet as if the user were locally based. A different computer center at Illinois was responsible, as well, for the popular Eudora client for electronic mail on PCs and Macs. The NCSA had worked to create a graphics-based collaborative tool for sharing documents called Collage, so it was natural for them to create a team to develop a graphics-based version of the Web "HyperText Markup Language" (HTML) protocols created by CERN in Europe. The result of this forty-member team was Mosaic, first introduced on the UNIX platform in January 1993, with Macintosh and PC versions introduced in August 1993. Copyrighted by the University of Illinois, Mosaic could be downloaded for free by individuals and by companies wishing to use the Internet for internal communications.
However, the NCSA did not want to become a help desk for commercial applications, so in August 1994, the University of Illinois assigned future commercial rights for licensing NCSA Mosaic to Spyglass, Inc., a local company created by NCSA alumni to commercialize NCSA technology. The goal was for university researchers to continue developing longer-term technology and standards to be incorporated into browsers, while Spyglass would help license the technology to companies addressing immediate customer needs such as support, speed, and security. Spyglass began widely licensing Mosaic to computer companies including IBM, DEC, AT&T, NEC, and Firefox Inc., who was working to integrate Mosaic standards into Novell networking software for the personal computer.
Watching Mosaic from the Bay Area, Silicon Graphics CEO Jim Clark, a veteran of the UNIX standards wars, understood how much money could be won if a company could take control of the standards of this new Internet tool. So Clark left his company and set out to destroy Mosaic and replace its government-backed standards. He met with Marc Andreesen, a member of the Mosaic team who had been hired at a Bay Area Internet security firm called Enterprise Integration Technologies. Out of that meeting in April 1994 was born Mosaic Communications Corporation (later to be called Netscape). With Clark putting up the capital, Andreesen recruited five other Mosaic team members from NCSA to design what they called in-house Mozilla, the Mosaic-Killer. In six months, Clark's team had created a powerful browser, which the team called Netscape. It had easy-to-navigate features and loaded graphic images faster than NCSA's Mosaic. But Netscape did something else--it included the ability to display text formatting that did not even exist in the HTML standards embedded in the NCSA Mosaic browser. This meant that Web pages designed to work with Netscape would not be readable by all the other Mosaic-based browsers. This would encourage people to use Netscape browsers and, as Netscape developed them, would encourage Web designers to pay Netscape for the server software that developed Web pages using their modified standards. It was in this later market of selling Web design tools costing from $1,500 to $50,000 where Netscape intended to make their money.
And then Clark and Andreesen compounded their fracturing of the NCSA standard by giving their version away over the Internet. The University of Illinois had demanded that Clark's company pay for a license before selling their version. Clark later said that he refused because the university was demanding an ongoing per-copy royalty: "I didn't tell them, but we had intended to allow people to download it, and they were going to charge me. The amount varied, but nothing is innocuous when you're talking tens of millions of people." The point of the licenses by Illinois had been, along with collecting a little revenue, to control the standards and make sure that the only free version available was the official NCSA standard. Netscape would essentially "dump" its version onto the Internet, thereby undercutting the rest of the commercial browser companies, which couldn't duplicate Netscape's actions because they were fairly paying per copy license fees. So Netscape, being the sole enhanced commercial browser flooding the Internet, was able to destroy NCSA-led standards and take over standards creation itself.
Unlike the situation with Sun Microsystems, where the government would decisively support open government-based UNIX standards, the federal government did nothing to support NCSA's standards. Other companies and analysts would immediately condemn Netscape's actions as a monopolistic move, but the government made no investigations into possible monopoly practices, no lawsuit alleging intellectual property infringement, no announcements that the federal government would use only NCSA-approved codes in government Web sites, no announcements that it would refuse to buy any Web servers (i.e. Netscape's) based on such non-standard formatting, and no signal from the government at all that they would oppose Netscape's takeover of the standards. Instead, the University of Illinois, after a bit of public grumbling, threw in the towel. They signed an agreement with Clark in December 1994 that allowed Netscape to be sold without a license for the minor concessions that the words "Mosaic" be removed from the firm's title and that no mention of Mosaic be made in marketing the browser.
In a perverse way, Clark and Netscape would justify their destruction of the government standards based on the expected weakness of the government in defending them. They predicted that Microsoft would soon use its dissemination of the operating system to take control of standards if Netscape didn't do so first through free distribution. Argued Clark:
At some level, standards certainly play a role, but the real issue is that there is a set of people, a set of very powerful companies out there, who don't play the standards game. For the standards game to work, everyone has to play it, everyone has to acknowledge it's the game. Companies such as Microsoft aren't going to sit around and wait for some standards body to tell them. If your philosophy is to adhere to the standards, the guy who just does the de facto thing that serves the market need instantly has got an advantage.
Netscape, having seized leadership of Web standards, would try to redeem its reputation by working with the old Internet fellowship of engineers embodied in the Internet Engineering Task Force (IETF) and the more recent World-Wide Web Consortium (W3C) based at MIT and run by CERN's Tim Berners-Lee, who came to MIT in late 1994.
And as Microsoft entered the game with its own Internet Explorer browser to appear on every Windows desktop, the grumblings over Netscape's occasional forays into proprietary advantage would lessen as the alternative fear of Microsoft taking over the whole computing world loomed. Having come late to the Internet, Microsoft initially directly licensed Mosaic browser technology from Spyglass in December 1994--a license netting Spyglass about $13.1 million. But when Microsoft began giving its browser away at the end of 1995, the rest of Spyglass's licensing revenue (amounting to $20 million) disappeared as the browser war settled into a two-company fight between Netscape and Microsoft.
In the end, Netscape would argue that the beloved public village of standards was threatened by Microsoft, and Netscape had only destroyed the village in order to try to save it. With the government withdrawing from its role in defending standards, such a standards war was inevitable.
Next: Why the Government Withdrew From Defense of Open Standards