DOUBE DEAL MAKING, THE BROWSERS WARS Case Study Solution
INTRODUCTION:
This case study specifically deals with the negotiations and strategy opted, by leading browser companies to make effective arrangements with the vendor. This case deals with the strategies put forwarded by Netscape and Microsoft, to compete over a contract with AOL. Both the companies negotiated with AOL, to be their default browser for online services. After intense competition coupled with personal rivalries among Microsoft and AOL, Microsoft succeeded to win the contract. The deal was so dramatic in a sense, that AOL-Netscape deal only lasted for a single day superseded by the deal between AOL-Microsoft.
Later on after a year’s gap, same companies fought for the major contractual arrangement with KPMG. KPMG was considering both the browsers for in-house use, being a major accountancy firm. After the intense negotiations and discussions, KPMG took decision in favor of Netscape.
DISCUSSION:
At the first instance, it is must to clearly define what actually the browser is?
In simple words, browser is a software program that is used to find out different web pages. In this case study there is a war seen between leading browser companies. By materializing their respective plus points and proposing their respective deals, they wanted to capture the market share as a leading browser.
Netscape was leading the market, by providing the wide range of browser services and other internet programs.Dealt with the intense competition with the other companies and emerged out,as the best web-browser providers across the globe. By following their initial strategy, they have developed their name among the customers and considered as a brand, in a very short period of time. They wanted to sell their services to corporations, to run their browsers and software’s and different application programs. After its launch, in a very short period of time Netscape captured the market and gained almost 60% of the market share.Afterwards, they had continuously strengthened their strategies, to compete with the world’s giant in the internet world i.e. Microsoft.
On the other side, Microsoft are there immense competitors, dealing with the huge giant having monopoly in an operating system throughout the world was not so easy task for the Netscape, Microsoft launched their own web browser in 1995, making it free for customers and for corporate level clients as well. They made all the efforts to make it a success, by offering it free of cost to different customers and over internet as well. They made their distribution free of cost and at zero-pricing, but got flopped. Microsoft also had competitive edge in online-businesses, they also offered their clients free access to MSN by just one click. Microsoft’s initial strategy was to capture the browser’s market by capping the percentage to 30%.Afterwards they intended to gain the whole market stake, by criticizing the Netscape’s quality of product.
AOL American online, is an online service store providing customers with the access to chat rooms, news and web access, but only to paid subscribers. Steve Case was the CEO of AOL, had cordial relations with Netscape and made effective contracts with the company in the past. Whereas, the relationship of AOL was not so good with Microsoft, because of close rivalry of providing same services to the customers.
ANALYSIS:
The case revolves around the profit motives and priorities of the different companies, despite of close rivalries and huge competition among the companies.The companies took most advantageous moves backed up, by the designed negotiation processes of the competent individuals.
Netscape wanted to have componentized application of Netscape, to make it built in in the company’s software and applications and not to make any sole program. Case really wanted to make a heavy deal with Netscape, by advertising the website. Netscape management did not prefer the deal,to produce the customized version of AOL application software. AOL desirous contract that is, to provide their customers with cost-cutting browser that is to provide them at the lowest costs. AOL made discussions during February 1996, to select the appropriate vendor for their online-software services....................
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