Wanted: Home for MSN waif

Free to a good home: more than 2000 Microsoft Network subscribers in New Zealand. Current owner getting out of access business, open to suggestions.

Free to a good home: more than 2000 Microsoft Network subscribers in New Zealand. Current owner getting out of access business, open to suggestions.

Yes, MSN will be killed off as an access provider in New Zealand, but Microsoft is not yet sure what it will do with the 2158 subscribers on its books as it moves toward being a Web-based "content service".

The decision to split the "platform" and content businesses of MSN was made in January, according to John Levisohn, manager of Microsoft's public networks group for the Asia-Pacific region. It was decided then that Microsoft had no place in the local Internet access market. Apple, in a similar quandary earlier this year when eWorld folded, gave stranded customers the option of shifting to a new ISP, Internet Express, but a decision from Microsoft may take a while yet.

"The transition will take place over the next 12 months, and we'll try to make it the earlier part of that time period," says Levisohn. "There are some network problems with the change from the existing X 25 network to TCP/IP which have to be worked out in detail."

Levisohn admits he has no data on what the MSN subscribers, who pay $28 a month for two free hours, are doing online, but admits the $19 an hour charge for additional hours makes MSN "clearly an expensive option". The cost of running its own X 25 network is one reason Microsoft could not compete in the local market, but the writing was probably on the wall even before the service was launched alongside Windows 95 last August.

"Early in 1995 we began to see the incredible potential of the Internet. Microsoft network's long-term future had to be as an Internet service. But the capabilities of Internet access providers hadn't really grown up at that point and we were concerned about bandwidth, so we launched MSN as a combined product, offering both access and content.

"But since January, the platform business is now concentrating on offering NT-based solutions to network providers. The content business will be the coolest site available on the Internet. If you have access to the Internet, you will be able to pay a subscription fee for the content."

The platform business's major sale so far is the package of NT-based software which will drive CompuServe's migration to being an Internet-based subscriber service. Levisohn admits to seeing the irony in selling tools to a company which could corner the very market MSN is seeking.

"Therein lies one of the interesting issues. CompuServe is both a customer and a competitor for us. Clearly, we don't know how it will pan out, but I think there is room in the market for a range of offerings, especially given the rate at which the use of online services is expanding."

The new MSN's latest move as a brand on on the Web has been to incorporate and develop the Entertainment Tonight Web site. The site has been redesigned for Microsoft Internet Explorer (parts of it don't work with Netscape) and, after a trial period, made exclusive to MSN subscribers.

Microsoft Australia has hired "content people" to work on localised MSN content, but this is unlikely in New Zealand.

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