By David Pescovitz
| NEW ECONOMY
| Digital Pinkerton
<h4>#### Larson has transformed Network Associates into the world's largest independent security-software company.</h4 "r of failure drives away the sense of complacency that success breeds," recites the 42-year-old CEO and chair of Network Associates, the world's largest company devoted exclusively to security software. In five years, Bill Larson has used that fear to transform what was once a 40-person, US$4.7 million virus-scanning-software company called McAfee Associates into a $600 million-plus, one-stop security shop with 1,800 loyal hands.</p>
Halso learned to talk the talk of a new economy cliché leader: "I still want people to act like we can go bankrupt if we don't perform"; "We want to be a billion-dollar company with a start-up mentality."</p>
FLarson, who used to race open-cockpit Formula 4 cars, performing means taking risks, like the buying spree he's been on since last fall. Following the December buyout of Network General, Larson bolted together the five wheels of network security – encryption and authentication (Pretty Good Privacy), firewalls (Trusted Information Systems), intrusion detection (Secure Networks), and antivirus technology (Dr. Solomon's Group) – into one steamroller suite called Net Tools Secure running on Windows NT. "What we're saying by doing this is that in a year there won't be a stand-alone firewall market," Larson explains. "And there won't be a stand-alone authentication market."</p>
Nork Associates isn't the only one pursuing an IBM "solutions" approach. Last year, Axent Technologies rounded out its product line by merging with Raptor Systems, a firewall firm, while in March Cisco acquired WheelGroup, whose forte is intrusion detection.</p>
Aeast one holdout, Internet Security Systems, insists the one-stop suite is a flawed approach. Some analysts agree, fearing Network Associates risks chaos by stuffing too many incompatible companies into one bundle; note the obvious culture clash between the cypherpunks at PGP and the squares at TIS. Ultimately, though, stockpiling partners may be the only way to secure market share.</p>
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tyear-old start-up's recently released flagship product, CustomerNow, allows befuddled, annoyed, or otherwise vexed visitors to a Web site to have a real-time chat with a customer-service rep. If need be, the system also allows the rep to remotely control the customer's browser, pointing the way to a purchase or other form of clarification. And, as CEO Wendell Lansford likes to demonstrate, CustomerNow works for anyone's browser; SiteBridge's trademarked WorksEverywhere technology, affectionately dubbed "The Nose," sniffs out the platform you're on and detects whether it's Java-enabled, JavaScript-enabled, or HTML-only and then serves up the appropriate interface.</p> <p>
Bge has competition from WebLine Communications (it has 50 corporate clients) and Aspect Telecommunications, but all three should be in demand, as vendors field the backlash of unattended Web sites.</p> <p>
oEMICAL SOFTWARE</strong
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wellsst from half a million to US$50 million to drill, and, given that only one in five produces black gold, it's easy to see why wildcatting is reserved for large corporations. But IBM scientist Ulisses Mello is changing this. His software allows prospectors to combine data from various sources to better determine whether a well will gush. "It's like what's happening on Wall Street," says Mello. "This opens a niche of opportunity for small, efficient companies."</p> <p><str
<ITIZENSHIP</strong></s
eong the estimated 30 to 49 million Americans with disabilities – or the 50 percent who will be by the time they're 70 – infotech is both a boon and a tease. Though the number of PCs and software programs that take various disabilities into account has increased, they typically lag behind the state of the art.</p> <p>Feel
theat from marketplace competition and political pressure, some IT giants have begun to realize the bottom-line value of adding or accommodating, for example, screen readers for the blind. Charted below is what the major creators of operating systems have (or haven't) done to capitalize on this market.<br></p> <p>
oPROBong> | NITstrong> | TATng> | HE strong> </
enternet Explorer 4.0 to market without accessibility features for the disabled. | A chastened Bill Gates held an "Accessibility Day" and increased Redmond's accessibility team from 8 to 25. | Biggest turnaround since Scrooge. | Windows 98 includes screen display improve-ments and a tool kit for hooking into more products. </p> <p> |
O8 user interface only slightly easier for disabled to use than Windows. | In 1985, created the industry's most ambitious access effort, the Worldwide Disability Solutions Group. | Will have to improve accessibility features to keep pace with federal laws. | The WDSG was 86'd in January. </p> <p> |
designers can't crack the Java code to link accessibility features to their pages. | Has stepped up efforts to open Java to designers and added "sticky keys" (for those with motor-skills disabilities). | Lots of R&D; few time lines for enhancements. | Gaining steam, but still has a ways to go. </p> <p> |
erface not disabled friendly; customers must go to third parties for (not-so-great) add-ons. | Collaborating with 14 partner companies on wide range of products and offering customer service. | Thirteen of the partner companies have products on the market; others to follow. | Effort isn't as extensive as Microsoft's, but it's a solid performance. </p> <p><em>
oll (<a href="htt>) reside a Montana basement, where he coproduces Rox, the first online TV series.</em></p> <p
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dividu#### nvestors, online forums are a place to dream, scheme, and run with the big dogs. But as fraud increases, forum moderators are pressed to act as censors.</h4> <h4>By Joe e#### h4> <p>On Augu 7, a retired New York City cop named Riley G (his real name) clicked into an obscure thread on the Silicon Investor Web site and posted a message. In it, he alerted others of his ilk to "the possibilities here of making money." Market makers, G asserted in a series of posts, had sold more shares of Olympus Ventures than had been issued, and those who bought the remaining shares could sell them back to the oversold brokers in what's known as a "short squeeze." For anyone confused by the lingo, G made it plain: The stock, then trading for about two dimes per share, could be driven up to US$400 to $500 per share. The crowd went wild.</p> <p>"I just
h,000 shares to show my support," wrote one visitor. "Yes, I'm crazy too. We're all crazy. Now let's make some money and be even crazier." By December, there were more than 30,000 posts to the thread, but by then the tenor of many of these had changed. The Securities and Exchange Commission suspended trading of Olympus stock (by then renamed Rocky Mountain International), and when the SEC halt lifted 10 business days later, Rocky Mountain itself refused to allow trading to resume. G's promise of easy money went unfulfilled.</p> <p>"What th
ln Investor people did was not good for our company," says Rocky Mountain CEO Gary Morgan, who believes that shorters, frightened by the possibility of being squeezed, set out to harm the company's reputation.</p> <p>Though t
tmay not be run of the mill, stories like it are not uncommon. The convergence of equity markets and the Internet has inspired a bum rush, and, as online investment and trading scams increase in frequency and subtlety, the gatekeepers of stock discussions such as Silicon Investor and The Motley Fool find themselves pressed to become traffic cops, even censors.</p> <p>Back in
d(1995, say), the grifters were relatively easy to spot. In August of that year, for instance, the SEC filed a complaint against Daniel Odulo, who was offering bonds via newsgroups for an eel-farming company called Golden Waters. Odulo promised a "whopping 20 percent rate of return"; the SEC pointed out that such a rate would be difficult from a company that didn't exist.</p> <p>Lately,
veven the cautious can be tricked. Touted by SGA Goldstar Research, an online newsletter, Systems of Excellence seemed a legit operation offering teleconferencing technology. But in January 1997, a Virginia federal court sentenced Systems of Excellence CEO Charles Huttoe to a 46-month prison term and fined him $10,000 for securities fraud.</p> <p>Thanks t
aemains of the 1996 Communications Decency Act, BBS moderators and webmasters are not liable if they too get duped. Yet few trust in the CDA, and few have forgotten <em>Stratton Oak Inc. and Daniel Porush v. Prodigy Services Co.,</em> a 1995 casrd in the Supreme Court of New York. Prodigy was found responsible for posts made to its Money Talk threads.</p> <p>"Any org
eommunity has to have rules and regulations that people abide by, and ours is no different," says David Forrest, community coordinator at The Motley Fool. "We're not responsible for what someone else posts," but, he adds, "when we see things that violate our rules, we remove them." Forrest notes that The Motley Fool employs a full-time staff of 20 to monitor content and remove anything inappropriate – which, to The Motley Fool, even includes discussion of stocks that trade for less than $5 a share. Silicon Investor now also keeps an electronic eye out for trouble. The company tracks the whereabouts of "problem users" on the site.</p> <p>Ultimate
mrigorous methods of filtering will be necessary for the Motley Fools of the world to gain and keep the faith of investors – particularly the wealthiest and most conservative traders. The challenge is how to do this without stifling the unfettered debate and dish that makes online forums exciting.</p> <p>"There's
aa possibility of further problems," shrugs John Keister, chief operating officer at go2net, which purchased Silicon Investor this spring, "but I guess that's what insurance is for."</p> <p>As for R
when he's not maintaining his Psychic Detective Web presence, he's keeping his eye on Rocky Mountain. Says G, "I'm in this for the long haul."</p> <p><strong>
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ionalsrbveo Ushakov, Vietalui Papsouev, Alexandre Konanykhine, and Mikhail Khodorovsky are suspected of getting rich off the Internet. According to conflicting press reports, all four played a role in the collapse of the Antigua-based European Union Bank, touted as the world's first Internet bank when it opened in 1994. The EUB principals had not been seen on Antigua for months, when in August 1997, US$6 million of the bank's deposits vanished and the EUB site went 404.</p> <p>Well, the de
tidn't exactly vanish. Just before it vaporized, the bank wired $4.8 million to a Russian bank, lending credence to the theory that the EUB was a scam masterminded by the four. A year out, the cleanup crew – including the FBI – has no new leads.</p> <p><strong><str
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tassets are shuffling … No sooner had the ink dried on Monsanto's US$2.5 billion check for the 60 percent of Dekalb Genetics (America's Number Two seed company) that it didn't already own than Monsanto itself agreed to a $33 billion merger offer from American Home Products. AHP, the folks who bring you Robitussin, Advil, and Chap Stick, reckon they can save about $1.5 billion a year by combining with Monsanto, perhaps fashioning painkillers from herbicides. And their claim to huge savings puts to test an idea that seems to obsess pharmaceutical CEOs: economies of scale in knowledge. Frankly, we're skeptical, but we'll keep Monsanto on the Index to reflect the test results … WorldCom and MCI, meanwhile, are conducting a more subtle experiment. MCI promised to sell its Internet backbone business (service contracts) to Cable & Wireless, so the trustbusters will give its merger with WorldCom the go-ahead. But MCI is not actually selling any of the fiber-optic cables that carry the business it's selling off. If in three years time it wins back some of that business, keeping the fiber will overturn another popular theory: It's better to own the contracts than the infrastructure.</p> <p><strong>The
dks 40 public companies selected by editors of <em>Wired</em> to seas a ether for the new economy. For a complete description and the latest results, see <a href="http://stoc>. The Wired Inde not a traded fund or portfolio. Some of the companies in the Wired Index may have an advertising relationship with <em>Wired.</em> Readwho uss information for investment-related decisions do so at their own risk.</strong></p> <p><em
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ernet vice providers have generally followed one of two paths: leverage economies of scale (e.g., America Online or WorldCom/MCI) or go the small-is-beautiful route. (See "<a href="http://archive.2.) Verio iing both.</p> <p>During the past
,e Englewood, Colorado, company has acquired a number of relatively small ISPs around the US: Washington's NorthWestNet, Texas's OnRamp Technologies, California's Network Intensive. It's part of an effort to create a national franchise of local ISPs offering a combination of fast, deep reach – secured in part by a US$100 million deal with Qwest – and homey customer relations. It's like a newspaper chain: Readers get local coverage reported by their neighbors, but their subscription checks get cashed out of town.</p> <p>Analysts are con
ey bullish on Verio. The company gets high marks for being selective about the ISPs it buys, and Verio's May IPO should reinforce its Pac-Man tendencies. "When we started," says Verio CEO Justin L. Jaschke, "small and medium businesses could go to a local ISP and face the possibility that it wouldn't be around for a long time or wouldn't be sophisticated enough. Or they could go to a big national company, and, whenever they needed something or had a question, they had to call someone at the other side of the planet." Now, Verio claims to offer the best of both worlds.</p> <p>More than 1 bill
stcards were issued in 1997 – a figure expected to triple by 2002 (The Insight Research Corporation) <strong>…</strong> FiftyeFortune 1000 executives think the Arch Deluxe is something that helps run a computer (Jericho Communications) <strong>…</strong> Nearlfbusinesses are reporting profits this year, up from 22 percent three years ago (ActivMedia) <strong>…</strong> The aorice of a wireless phone call fell 20 percent last year (The Yankee Group) <strong>…</strong> Nearliolds made an online purchase during the final six months of 1997, more than double the number for that same period in 1996 (Odyssey) <strong>…</strong> About agers at Fortune 1000 companies expect to acquire more than half of their software online by 1999 (Forrester Research)</p>
