Now that the leading browsers can push content, all eyes are glued on the pioneer of push--PointCast. Can PointCast, which has attracted marketers such as Mercedes-Benz of North America and Procter & Gamble Co., and built a following of 1.2 million active users, maintain its edge?
PointCast took an aggressive step in defending its lead last month when it named David Dorman, former exec VP of SBC Communications, as its president-CEO, replacing PointCast founder Christopher Hassett, who became chairman. Mr. Dorman, who was chairman and president-CEO at Pac Bell before it merged with SBC, arrived at this Sunnyvale, Calif.-based company armed with ambition: He wants to double PointCast's subscriber base in the next 18 months--and that's just within the business market, which the company has focused on since it launched the PointCast Network two years ago.
One roadblock for the PointCast Business Network is company fire walls that prohibit constant Internet access for employees. Drawing on his background, Mr. Dorman has outlined ways to help businesses ease bandwidth problems by using the untapped "D channel" on phone lines.
IMPROVING THE NETWORK
The "tried and true" business audience will continue to be PointCast's main focus, Mr. Dorman said. "I think it's pretty clear, we have a direct selling opportunity to Fortune 500 clients," he added.
But PointCast, which is said to be preparing to file for an initial public offering, knows more than most how critical it is to broaden its subscriber base and business model.
It's already moved in that direction on several fronts. When PointCast College Network opened in September, it had a stack of charter sponsors, including Apple Computer, Ford Motor Co., SegaSoft, Visa USA and others. Anna Zornosa, senior VP-ad sales and affiliate development at PointCast, said the College Network is on track to reach 150,000 registered users by the end of the year.
The PointCast Business Network is also spreading its wings, with the addition of Insider Channels aimed at 10 specialty industries. Sponsors anchor each Insider Channel. For instance, EDS backs the Aerospace & Automotive Insiders, while KPMG Peat Marwick sponsors the Banking & Consumer Markets Insiders.
ADDING VERTICAL CONTENT
PointCast is also casting international business lines with PointCast Japan, a co-partnership sold and managed in Japan with regional content providers.
As aggressive as these efforts may seem, the reality is that PointCast no longer owns the market.
Several hundred Internet companies signed partnerships with Netscape Communications Corp.'s Netcaster and/or Microsoft Corp.'s Internet Explorer 4.0 to push content to consumers. Yet Ms. Zornosa views both browsers as a validation of the medium, rather than a threat.
A VALIDATION OF PUSH
"The introduction of [Microsoft's] Active Desktop really illustrated that the strategies we put in place when we designed the PointCast Network were right," she said. "Today we find ourselves as the only push player who's developed an ad-model around the push category."
A year ago, she added, industry analysts predicted the field would have a few dozen such companies.
PointCast is also a prominent channel on IE 4.0, something that could be critical to reaching consumers, Ms. Zornosa said. This eliminates having to download PointCast software from its site.
So far, PointCast's audience comprises mostly early technology adopters and business professionals. PointCast studies have shown that women and mass consumers are more likely to use the service if it's pre-installed on computers.
FIRST TO MARKET
PointCast is "focusing on the fact that they have some brand recognition," said Evan Neufeld, senior analyst at Jupiter Communications, New York.
"A year in this marketplace is a long time," he said: "PointCast has been in this marketplace for two years. They've done a lot of things right from an advertiser's perspective."
Getting into the market early and being among the first to spread the word to ad agencies about intermercials, animated Web commercials, also works to its advantage, Mr. Neufeld said.
But he added, "I think what people have said eternally is, `How are they staying in business?' "
For now PointCast is positioning itself as a media company and distancing itself from the technology, he said.
Promoting the PointCast brand to marketers and consumers is more important than ever. "They have to make sure they're not just hanging on to the people they have--they've got to attract new users," said Mr. Neufeld.
Copyright November 1997, Crain Communications Inc.