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February 6, 1996

Microsoft to Give Away Web Server Software

By PETER H. LEWIS

Microsoft Corp. said Monday that it would begin distributing free software that businesses could use to create World Wide Web sites on computers using its Windows NT operating system.

The move is seen as a direct salvo against Netscape Communications Inc., which sells similar software. The programs allow companies to create and maintain information sites either on the Internet or for internal company use.

In a further sign of its new aggressive interest in the Internet, Microsoft also said Monday that it was stepping up its efforts to become a major global Internet access provider, and that demand for Internet access from overseas had exceeded the company's forecasts.

"Microsoft is going to be one of the primary players in the Internet era, and this is a significant milestone for them," said J. Neil Weintraut, head of Internet research for the securities firm of Hambrecht & Quist in San Francisco.

Microsoft said the software to be given away was much faster than Netscape's equivalent server software for the Windows NT network operating system. Netscape sells its software, which is used on powerful microcomputers called servers, for $495 a copy.

But Microsoft's free Web server software must be installed on top of a current version of Microsoft's Windows NT Server, which itself costs hundreds of dollars. The Microsoft Internet Information Server software will be released on the Internet beginning next Monday.

"This marks the start of the tit-for-tat race in the server marketplace," Weintraut said. "We anticipate that Netscape will have a significant server announcement by the end of March."

Mike Homer, Netscape's vice president for marketing, said Microsoft's move had been expected in January. He also noted that most Web servers on the Internet are based on the Unix operating system, although he conceded that Windows NT constituted a "significant chunk" of Netscape's business.

Separately, Microsoft and UUNet Technologies Inc. of Fairfax, Va., announced Monday that they were ahead of schedule in deploying the infrastructure for the Microsoft Network in the United States and 14 other countries.

In a briefing to analysts and reporters last December, Microsoft said it was transforming the Microsoft Network, which was originally conceived as a proprietary on-line information service similar to America Online, into an open network for providing consumers worldwide with access to the Internet and the Internet's electronic publishing service, the World Wide Web.

Last week, Microsoft disclosed that it was abandoning work on an important technology for creating multimedia content for the Microsoft Network, and turning its efforts instead to developing tools for creating World Wide Web content. The move stunned some companies that had made major investments in developing content specifically for the Microsoft Network.

Last week Microsoft announced an alliance with MCI to offer Microsoft Internet software to the telephone company's Internet customers. Previously, MCI had invested in Rupert Murdoch's News Corp., which was creating a rival system.


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