Chairman Bill Gates is expected to take the wraps off of the long-awaited Marvel online service next week, finally giving the industry something concrete to talk about.
And last week, Microsoft said it would work with several technology partners, in-cluding Hewlett-Packard Co. and U S West Communications, to develop interactive TV offerings in such areas as education, games and shopping.
The online service-code-named Marvel, but likely to be marketed under another name-will be available in the first half of 1995, when Microsoft is expected to bundle it as part of the new Windows 95 operating system.
Mr. Gates is likely to detail Microsoft's strategy for the first time in his keynote speech Nov. 14 at Comdex/Fall, the computer industry trade show in Las Vegas.
Speculation about Marvel's powers has been rampant in recent months.
While existing online services and even the Internet appeal to a fairly small base of computer users, Microsoft is developing Marvel for the masses.
Microsoft projects first-year sales of 20 million to 30 million copies of Windows 95. Marvel should get a high percentage of trial by offering access at the click of an on-screen icon.
The company could encourage trial by offering special customer support for various company products, and Microsoft probably will undercut the competition on both subscription prices and advertising rates to gain market share, analysts say.
Microsoft declined to discuss the unannounced product.
The key could be transaction fees, in which Microsoft takes a small fee for selling a product or delivering an ad or information.
"I'm sure Bill just drools over the idea of transaction-based revenue as opposed to something you buy once," said one software industry analyst. "To get a nickel for every transaction forever is the stuff Bill's dreams are made of."
Microsoft's pending $1.5 billion purchase of Intuit, marketer of the Quicken money-management software, may add another element to Marvel by connecting electronic commerce to a consumer's bank account.
"By purchasing Intuit, essentially what Bill Gates does is he gives himself the ability to set up a tollbooth on the Internet, or on an online service, so that he can begin to capture some of the revenues," said John Aronsohn, consumer communications analyst at the Yankee Group, Boston.
Marvel could give Microsoft a second huge marketing advantage: Analysts say the service should allow Microsoft to know what hardware and software setup a user has, allowing Microsoft to target its sales messages and sell that information to others.
Conceivably, Marvel could quickly become the dominant online service.
"Microsoft is a very formidable threat to the current online players," Mr. Aronsohn said.
It might also be possible, though, for Microsoft to ward off antitrust concerns by somehow opening Marvel to other online providers. That would be similar to the way Microsoft encourages rivals to develop Windows software applications that compete with Microsoft applications.
Not that Microsoft is guaranteed dominance. Historically, the company has suffered glitches with all-new products, meaning it could take time to prove Windows 95 and Marvel.
For now, many analysts say the online field is too small for federal regulators to step in. But if Microsoft were to dominate an unregulated online field in the way AT&T once dominated the long-distance market, it could invite regulation.
On the interactive TV front, Microsoft last week said it had formed partnerships with technology companies including Hewlett-Packard, U S West, Deutsche Telekom of Germany and NEC Corp. of Japan.
Deutsche Telekom and U S West will help test software that Microsoft is developing for an interactive trial with cable giant Tele-Communications Inc. in Seattle.
Microsoft already has deals with Compaq Computer Corp. and General Instrument.
Microsoft also went on the acquisition trail again, saying it would buy U.K.-based NextBase, marketer of mapping and route-planning software for cars, creating yet one more market for Microsoft to conquer.