(COMTEX) B: Microsoft, USWeb/CKS Ink $90M Deal
B: Microsoft, USWeb/CKS Ink $90M Deal
Sep 29, 1999 (Tech Web - CMP via COMTEX) -- San Francisco -- In an
embrace of a business model that could theoretically unseat its rule on
the desktop, Microsoft pledged approximately $90 million to USWeb/CKS
Tuesday.
In return, Microsoft gets the e-services provider's co-marketing and
implementation support for forthcoming Microsoft products, as well as
what analysts described as a new way to penetrate small- to
midsized-business markets.
In an event for press and industry analysts held here Tuesday, USWeb's
Chief Executive Robert Shaw and other executives talked about plans to
develop iFrame, a set of customizable applications, standards,
components and methodologies that will serve as a template for USWeb
consultants building solutions for clients.
USWeb's other buzzword of the day was iAMsystem, or Internet
Application Management System, which is in effect a set of
line-of-business applications focusing on customer relationship
management, e-commerce, back office and knowledge management.
These applications will be built with Microsoft products, though Shaw
noted that USWeb will "be free to use any product we want" --not only
those from Microsoft, in the creation of its e-business solutions.
Alex Hawkinson, executive vice president for USWeb/CKS's managed
services division, said that some 3,500 of USWeb's approximately 4,500
global deployments use Microsoft products.
USWeb executives broke the $90 million down into smaller chunks: $67.5
million would go toward joint marketing and development of solutions
based on USWeb's iFrame managed services, and another "several million"
will go toward training USWeb consultants.
The balance comes from Microsoft's plan to purchase one million shares
of USWeb/CKS common stock at a fixed price of $27.59 per share over the
next five years, executives said.
The companies are also cooperating on a joint technology lab slated to
open in Redmond, Wash. by year's end, where integration of Microsoft's
Active Directory into iFrame and testing of Microsoft's forthcoming
AppCenter product will be critical, Shaw said.
John Connors, vice president of Microsoft's worldwide enterprise group,
was on hand here to provide the software maker's view of the deal.
"We think software is going to be a service," Connors said,
characterizing that service as "an extension of the PC" and Microsoft's
response to the rise of application service providers as "reinventing
ourselves as a company."
The PC industry is only aided by the rise of hosting companies, service
providers and other types of companies thriving in the Internet era,
Connors said.
"Any industry that shops hundreds of thousands of units year after
year" is in little danger of faltering, Connors suggested.
Analysts said that the deal would help Microsoft meet goals it has set
for itself.
"Microsoft has always stated it wants a significant presence in the
e-services space," said Steve Lidberg, a research analyst with Pacific
Crest, Portland, Ore. The deal will most likely benefit small to
midsized companies that might get "a cheaper entry point" to business
applications, he added.
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Copyright (C) 1999 CMP Media Inc.
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