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In the early days of television, people watched the test patterns. Somewhere, recently, we heard the Web referred to as the "test pattern for the 21st Century". We think it's apt.

In the current issue of Seidman's Online Insider, Robert Seidman waxes eloquently about the future of the Web as the foundation of Interactive television. He's close to being right. But, the future includes some significant detours for marketers and thinking about marketing.

Cybergold will shortly offer users digital cash to view and rate ads. The system isn't up yet, but potential advertisers can read up on how to get in on the action and potential users can sign up to be notified when the site goes live.

You may be interested in the new, nontechnical revision of Donna Hoffman's working paper reanalyzing the CommerceNet/Nielsen Internet estimates:

Hoffman, Novak and Kalsbeek (1996), "Internet and Web Use in the United States: Baselines for Commercial Development," July 10.

The revision provides a new segmentation based upon Internet and Web use and an analysis of important demographic characteristics, computer usage behavior, and general computer and Web-specific activities for these segments.

There is also an appendix containing detailed tables analyzing an additional 38 marketing variables by each segment for men and women separately.

Apple Computers has made some major "improvements" in their website. Gone are the customer oriented pointers to software upgrades and new products. They've been replaced with pointers to the CEO's bio, press releases and a search engine that lets the user "find" things but doesn't bother to mention what is available to be found.

That this bizarre incarnation got through the in-house marketing department doesn't bode well for Apple's future. We'd bet that even Forrest Gump has sold his stock. It's too bad.

As devoted Apple evangelists, we've hoped against hope that Apple would survive its lost vision and misplaced focus. But now, instead of focusing on their loyal base of users, they're emphasizing the upstream components of the market.

The really sad thing is that from "getting it" about the Web as a communications vehicle, they've moved to "not getting it". The web isn't a vehicle for broadcast messages of corporate vision, it's an embracing tool that works best when it surrounds users with their preferences. By shifting into a broadcast mode, increasing standardization and focusing on damage control, Apple is demonstrating the depth of their internal panic to anyone who cares to look.

As a lesson, take a look at the "new and improved" Apple Computers website. We're sure that the corporate managers inside the company loved the product. We're equally sure that many of the site's users will get the sickening feeling that they can't find anything.

The lesson: Keep your eyes on your customers and keep your internal machinations internal.

I-Watch is a great example of a typical Web marketing disaster. The recipe is: take one really great idea; flesh it out as a website; spend all of your money on product development; and, leave the final site untouched for months. In other words, it's terribly easy to invest in site development at the expense of marketing. The results are nearly always fatal and embarrassing.

The site has the following features areas.

• The Best-Kept Secrets of Email Marketing
• Net-Biz Alert
• The Ad Spot
• Net Resource Locator
• Marketing Discussion Areas

Use I-Watch as an example of how not to do it. With no marketing budget, a limited set of inbound links and an unfilled promise of changing content, I-Watch was doomed to failure.

Today's piece is a reprint from E-Node, a monthly newsletter about the net. Subscription information follows the article>

I have a terrible confession to make. A part of me, a not-so-small part of me, wants Microsoft to dominate the Internet.

I am not a masochist. I am not working for an international conspiracy. I do not need an exorcist. As much as I hate Microsoft--and as a Mac user, I _hate_ Microsoft--I think it will eventually take over the Net, and I think that might not be so bad.

When I say I hope Microsoft wins out, I'm not referring to the current "browser war." Six months ago, pundits were saying that Microsoft had missed out on the Internet and that new nimble companies like Netscape were taking its place, boldly moving us forward. Within six short months, conventional wisdom has turned on its head, and many are predicting that Microsoft's Internet Explorer will eventually beat Netscape's Navigator. Considering how self-satisfied the folks at Netscape are, even as they torture us with hideous new features and a browser that routinely crash, I get a certain vicious thrill watching them being hunted down by Godzilla. But whether or not Godzilla wins in the next 18 months, it won't significantly affect our lives.

The real struggle for domination goes far beyond the issue of whose software is used to surf the Net. As Business Week and other magazines have argued, the real battle is the result of the fact that the Internet may change how all software operates.

Right now, most word processors, spreadsheets, and databases are unwieldy monoliths. You can't mix and match features: either you get Microsoft's Word or you get Word Perfect. You might not like the way Word handles tables, but either you take all 30 diskettes worth or you don't get any of it.

The Internet may provide a very different way of using software. With the growing acceptance of the programming language Java (which I'll discuss next month), one day software may be designed as a series of components, just like a stereo system. So, for example, if you used a word-processor but liked someone else's spell-checker better, you could just download and plug in the other spell checker.

Some pundits have predicted that if programs are broken into a series of components, Microsoft will lose their monopoly. You wouldn't have to buy all your components from Microsoft just because you bought their basic word processor or spreadsheet. In the long run, this would give rise to a whole industry of small entrepreneurs producing software components that you could plus in if you needed a new feature. Microsoft's power would be broken, because they could never keep up with the ingenuity of the little guy or gal.

This is a wonderful fantasy, and it would be nice if it came true. But it's unlikely that "Small is Beautiful" will win out. Unless Microsoft stumbles badly, they will end up dominating this new world.

When the new world of software components opens up, most people will start off with Microsoft's basic word processor, spreadsheet, and database components, just because they're using Microsoft today. This will give Microsoft an enormous advantage. They will understand how their software components go together much better than anyone else does, and when they make changes in the structure of the basic software components, they'll make those changes to suit their programmers, not outsiders.

More importantly, Microsoft will be in a position to "lock in" the market by extending their current suite strategy. Microsoft gained its dominance because of Microsoft Office, which packaged together their word processor, spreadsheet, and database together. This bundling made it very hard for any individual word processing or spreadsheet company to compete.

Microsoft could use the same strategy to dominate the Internet. It could tell its customers that for $50 a year, you can download a certain number of upgraded and new software components from a basic "suite" that you'd purchased. This would create a formidable obstacle for other software companies. Every time a small company came up with a hot, new software component, within a year or two, Microsoft would release a similar component that was "free" for everyone in the country who paid $50 a year for the suite.

Would Microsoft end up controlling the entire software industry? Of course not. There would always be niches it wouldn't dominate. In fact, it might even grow up a little and deliberately decide not to try to own the entire software market so the Justice Department would stay off its back.

But Microsoft would still have an enormous advantage. Most people don't need lots of bells and whistles. A few optional features and an occasional upgrade is more than enough. In fact, for most people, having so many options is too confusing; a friend once joked that when he first used Microsoft Word 6.0, he was afraid he'd hit the wrong key and send a nuke streaking towards Moscow! To pose a threat to Microsoft, a software company would have to do more than add a few doo dads. Their software components would have to be much, much better than Microsoft's current software.

Much as I hate to say it, a Microsoft-dominated world of software components might not be a bad deal for us consumers. Because if Microsoft captures the Internet, the Internet will also capture Microsoft.

Microsoft rarely beats its competitors because it produces amazing technology. In fact, some of its best programs started out as real dogs. Where Microsoft has always excelled is in the business end of computers. They know how to take products and continually improve them.

Today, Microsoft doesn't have to do something really innovative with Word or Excel because they don't have much competition. A small outfit can't dream of competing against Microsoft, because the startup cost is too high: they have to build an enormous program that offers all the features that Microsoft does. But in a world where you can get new software components over the Internet, it will be much easier for someone small to pose at least a temporary threat to Microsoft. This will be particularly true for amateur programmers who produce freeware or shareware programs. With this constant pressure, Microsoft will be forced to add new options and constantly make small improvements to keep their competitors at bay.

At the same time, Microsoft's domination might end just-too-fast development. As I discussed in last month's column, if Netscape wants to survive, it has to keep changing the standards even if the new features aren't very useful or are too much of a pain to use. Microsoft will be big and powerful enough that they won't need to change their standards unless the new features are actually useful.

Barring unforseen circumstances or an alien invasion, I think Godzilla will continue to reign. None of us will be happy about it--Microsoft will always find new, small ways to piss us off--but it may not a bad deal for us consumers.

E-NODE is a monthly column about the Internet. To subscribe to E-NODE, send the following email to enodelist@garnet.berkeley.edu:

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Donna Hoffman, the Vanderbilt marketing professor has delivered another solid contribution to the emrging Web/Net Marketplace. Give Internet Use in the United States: 1995 Baseline Estimates and Preliminary Market Segments a thorough scan. The report is a strong attempt to reconcile the conflicting numbers floating around in various Internet Demographic surveys. Hoffman's team have identified four major market segments based on frequency of usage. The accompanying demographic matrices provide a solid insight into the Net as a bulk market.

We wonder, though, when the market researchers will start segmenting the Net's population into real markets...ie, interest clusters. The fact that 10 million 35 year old males use the Net frequently is of little interest if they're all interested in football and we're selling books. We hope Hoffman and Co will come through shortly with demographic data about niche markets.

Customer service and support are central components of any marketing strategy. The fascinating thing about the web is that it allows small, regional players to benchmark their customer service performance against large, well-heeled, international players.

Take Professional Messenger, for example. The firm, a regional messenger service working in the San Francisco Bay Area, chose to use UPS and Fedex as its service benchmarks. As a result, you can place and track orders on the web with Professional Messenger.

The site, cleverly crafted by Internet Literacy Consultants simultaneously raises the performance entry bar for other regional messenger services while establishing that Professional Messenger intends to hold itself to the delivery and quality standards of much larger operations. It's a fantastic idea executed with attention to customer satisfaction and usability rather than graphic flash.

We think it's a model that any Web business can apply to their operations. Pick your competitors carefully.