Online service targets computer users, publishers

Ziff-Davis Interactive, a division of Ziff-Davis Publishing, last week introduced a prototype of its new online service for computer professionals, code-named Interchange. Although the service is still in development — and we know a lot can change between now and its expected fall rollout — Interchange sets a new expectation level for what it should “feel” like to gather, create and distribute information online.

The service, which has been in development for more than two and a half years at Ziff-Davis Interactive’s offices in Cambridge, MA, is built from the ground up as a publishing environment. The Interchange architecture supports media-rich documents (that is, documents that combine text, audio and graphics), simple click-and-drag editing tools and a unique, contiguous “information space.” The information space is unlike existing commercial online services today, because it allows subscribers easily to perform cross-service searches and create extensive links among various content provided on the service.

SPECIAL INTEREST CONTENT AREAS

Initially, ZDI plans to narrowly focus the content available on Interchange. Based on Ziff-Davis’s background — it is one of the largest computer publishers in the world — it should come as no surprise that Interchange will primarily provide information pertaining to personal computing. Publications committed to delivering content for the Interchange online service include Ziff-Davis’s PC Magazine, PC/Computing, PC Week, Windows Sources, Computer Shopper, MacWeek, MacUser, Computer Gaming World and InfoWorld, which is published by the International Data Group.

Tech talk and software. In addition to electronic computer magazines, the computing section of Interchange is expected to provide standard online fare, including shareware, freeware and public domain software as well as commercial software drivers and demos that members can download to their personal computers. (According to ZDI, subscribers are able to download information or software in the background, while still using the service to check mail — an impossibility on any of the existing commercial services.)

ZDI also plans to offer “tech talk” forums on Interchange, where industry leaders, editors and technology experts will gather to discuss the news and views of the personal computing industry. Also included is a Companies Online section, which initially will include 75 software, hardware and networking vendors that have agreed to provide software updates, new product specifications and technical support to members of Interchange.

Even techies need (sports) news. Several non-technical publishers have committed to distribute their content on Interchange as well. The most entertainment-oriented of these comes from StarWave, the Seattle, WA-based interactive media company founded by Microsoft cofounder Paul Allen. According to ZDI, StarWave plans to produce an electronic sports section for the Interchange online service. (No details on this service were available at press time.)

In addition, ZDI plans to offer general news and reference services on Interchange, including PC Quote, a market information and analysis service; Reuters NewMedia; Grolier Electronic Publishing’s Academic American Encyclopedia; weather information from Weather Services Corp.; and Kiplinger’s Personal Finance Magazine, a money management publication from the Kiplinger organization.

CREATED BY AND FOR PUBLISHERS

While certainly not yet a mix of content to lure every man onto the Interchange network, ZDI says it intends to broaden the scope of the service by developing other highly focused special interest areas beyond personal computing coverage.

Michael Kolowich, president of ZDI, says he is confident that the service’s sophisticated publishing tools and its object-oriented environment will lure additional content companies, as well as more diverse subscribers, into the Interchange fold. According to the company, ZDI is already in negotiations with several mainstream media companies to provide services on Interchange in time for the expected launch of the product this fall. Kolowich says that ZDI will charge publishers 20 percent to 50 percent of its revenues for use of the electronic service.

Breaking the ASCII ceiling. Unlike existing online services, Interchange is built on what ZDI calls “rich documents” that tie together formatted text, graphics, images and hyperlinks. Therefore, the Interchange documents can include embedded connections to related articles, software, searches and discussions, according to Kolowich.

We haven’t seen a live online demonstration of this hyperlinking capability (we were shown a prepared presentation). But if ZDI can successfully implement this technology into Interchange, we see it as one of the most valuable features of the service.

It offers subscribers and publishers the potential to create extremely indepth, or narrowcast, compound documents. For instance, members could use Interchange to do extensive comparative shopping on computer equipment and peripherals as well as potentially place their order online. In addition, they could use the service to gather extensive information about topics, such as computer virus protection, complete with access to the appropriate anti-virus software. (This is in no way an impossibility today but what ZDI is promising with Interchange is a kinder and simpler way of making these connections.)

Click-and-drag editing. ZDI says it also plans to offer a set of simple-to-use tools that will enable subscribers to customize their workspace, automate the collection of information and subscribe to areas of the service they access and read regularly. If a member consistently follows a particular discussion or executes a certain search, for example, Interchange can be set up to automatically update the discussion thread and/or execute the search and copy the results to a member’s PC every time he or she logs on.

While Ziff and ZDI have invested millions trying to figure out what subscribers want to see on their computer screens, the company has also spent a great deal of cash on what goes on behind the scenes. Interchange runs on a cluster of Digital Equipment’s Alpha-based VAX processors that, according to Kolowich, enable subscribers to search entirely across the information space. “With services like CompuServe, data is divided into multiple standalone servers that don’t make it easy to share information,” he says.

Testbeds by summer. Kolowich says ZDI plans to have 40,000 to 50,000 Interchange subscribers online by summer as part of a select beta-testing program. The service, which will initially be made available for the Windows platform only, is expected to be commercially available this fall. A Macintosh version, according to ZDI, is about six months behind the Windows version in development and is not expected to be shipped until early 1995.

Although pricing for the service has not been set, the service is expected to be based on a $10 to $15 basic monthly membership fee, plus an hourly fee for extended use, according to ZDI.

REINVENTING A PUBLISHING BUSINESS

According to Kolowich, when Bill Ziff, founder of Ziff-Davis, hired him to start ZDI almost three years ago, Ziff said, “‘If someone is going to kill publishing as we know it, it better be us.’” And that, says Kolowich, is what the ZDI team set out to do with Interchange. There are several very real concerns with that goal, not the least of which is that Ziff employs more than 4,000 people worldwide to produce its print publications.

Safe for now. Kolowich quickly went on to explain that Ziff sees the two distribution mediums as highly complementary for the foreseeable future. There just aren’t enough personal computers out there that are capable of running Interchange (you need a ‘386 or better), nor is there enough compelling content online to be an actual threat to Ziff’s, or for that matter, any publisher’s traditional print business. In addition, last time we checked electronic advertising hadn’t exactly taken off and publishers, such as Ziff-Davis, draw a substantial portion of their revenues from print advertising.

According to Kolowich, ZDI is experimenting with electronic advertising on Interchange, but the service will not be dependent on dollars from advertising to survive. So where will the return on this “tens of millions of dollars” investment come from?

Courting early adopters. Kolowich declined to comment on ZDI’s projected subscriber numbers for Interchange, but the company is obviously hoping to win over a substantial share of the existing online subscriber base, many of whom are computer professionals using online services for business first and pleasure second. As that dynamic shifts and more sophisticated personal computers find their way into people’s homes, Ziff-Davis intends to shift the balance of its content, from professional to consumer.

Ziff-Davis is far from alone in its aspirations. In addition to the existing commercial services — America Online, Prodigy and CompuServe (on which ZDI already runs a text-based computer online service called ZiffNet) — a slew of new competitors are flocking to the online market, including Apple, Microsoft and most notably, in Ziff-Davis’s case, its computer publishing rival, International Data Group, which also plans to launch a personal computer online service in 1994.

Ultimately, this battle of the online service providers will come down to who has the most transparent technology and the best content. It is in these areas that Ziff, with its 15 years in the business of computer publishing, is confident it will prevail. According to Kolowich, the company has the knowledge and the deep pockets to not only survive the battle, but potentially win the war.

Whatever the outcome, this will be one war worth watching.

Janice Maloney