Marc Andreessen Gets a Big Job Interview
By Kara Swisher
12/07/98
The Wall Street Journal
Page B1
(Copyright (c) 1998, Dow Jones & Company, Inc.)
Former barefoot Time magazine cover boy with experience in changing the way the world communicates seeks position to do it all over again. Willing to relocate.
Netscape Communications Corp. co-founder Marc Andreessen today visits America Online Inc.'s Dulles, Va., headquarters for only the second job interview the 27-year-old has ever had. The meeting is brimming with symbolism, about the maturation of one young man and the Internet itself.
At Netscape, Mr. Andreessen led a band of Silicon Valley radicals with absolutist views about the World Wide Web and open disdain for AOL. Now he is negotiating for a major role at Netscape's potential owner, the result of a $4.2 billion deal that may transform the industry. And things that once turned Mr. Andreessen off about AOL -- which grew by hawking online access and content to the technically illiterate -- seem from his new perspective to look sensible and exciting.
"I'd love to do it . . . bringing this stuff to those who don't want to be burdened with a lot of complex technology," Mr. Andreessen says. "There are a lot of lessons to be learned from AOL."
People familiar with AOL's point of view see him as some sort of top technologist at AOL headquarters, assuming a deal closes, as expected, in several months. AOL Chief Executive Officer Steve Case, though poker-faced about any talks, expresses interest in retaining Mr. Andreessen.
"If we can work it out, we would love to have him in one of the key positions of figuring out the directions of this medium," Mr. Case says. "He brings an incredible amount of credibility to any company, since he has been one of the key players on the Internet."
Mr. Andreessen has a good negotiating position. For one thing, he doesn't need to work. His Netscape stock and options will be valued at nearly $100 million in AOL shares, assuming the deal goes through. For another, Mr. Andreessen could be vital to retaining talent and morale at Netscape's Mountain View, Calif., operations, which would continue developing Internet software under AOL's ownership.
The future of that franchise is one of the biggest questions about the deal. While AOL is a good fit with Netscape's Web portal, many wonder whether it can run Netscape's sophisticated software business.
The world looked different in 1994, when the tall, baby-faced Mr. Andreessen left the University of Illinois with several classmates and developed one of the first programs for navigating the World Wide Web. Netscape, first funded by entrepreneur Jim Clark, went on a rocket ride that inspired national magazines to ponder whether Mr. Andreessen was the next Bill Gates. Then came Microsoft Corp.'s counterattack, which savaged Netscape's original Web-browser business model and triggered a government antitrust suit against Microsoft.
In Netscape's heyday, Mr. Andreessen and others at the company insulted AOL in an almost juvenile fashion, deriding it as a closed online service that would be made extinct by the freewheeling Web. AOL was full of commercials, beset by customer-service problems and struggling to show a profit. In one late 1996 debate with Mr. Case and Microsoft's Brad Silverberg, Mr. Andreessen suggested AOL's proprietary business model -- requiring users to access the Web through a separate online service -- was a dead end.
"The battle for subscriber retention in Steve's industry will become so bitter that you will see marketing wars the likes of which you've never seen before," he predicted in one online forum sponsored by The Wall Street Journal Interactive Edition. Months later, speaking to the Washington Post, Mr. Andreessen again questioned AOL's approach. "If you can't make money with eight million customers, how many customers do you need?" he asked.
AOL increasingly opened itself to the Web, though relations with Netscape weren't helped by AOL's 1996 choice of Microsoft's Web browser over Netscape's. Still, Mr. Case remained an admirer of Jim Barksdale, Netscape's chief executive, and had long toyed with the idea of buying some or all of the software company. And as competitive pressures increased, Mr. Barksdale began thinking more seriously of selling his company. After an initial round of talks early this year, negotiations between the companies began in earnest last summer.
Mr. Andreessen began re-evaluating AOL. He opened a new AOL account this past summer, finding the latest version of its software and service much better than the earlier versions he found clunky. He noted that AOL managed to buy an innovative Israeli company called Mirabilis Ltd. and retain its maverick talent. Ultimately, he concluded that the AOL subscription model he once dismissed created a closer relationship with customers than a Web site like Netscape's own portal, Netcenter.
His earlier attitude, Mr. Andreessen now says, reflected a kind of Silicon Valley mentality that becomes enamored of technology while losing sight of people.
He also says the technical elite unfairly exaggerate the shortcomings of any highflying companies. "Look at Steve Jobs," he says, referring to the charismatic co-founder of Apple Computer Inc., who has survived several dramatic highs and lows. "I can count four times that he has proved he is a genius . . . and that included a 10-year dry spell." In general, he says, "I had come around to seeing that the traditional Valley way does not always work."
He has few qualms about deserting that world for AOL's headquarters in the Washington, D.C., area. In fact, Mr. Andreessen thinks the online service could become the real crucible of the Internet's evolution, as communications technology fades into the fabric of new types of non-PC appliances and consumer services. He hopes to help that happen by adding to AOL's understanding of research at companies and universities that is still largely untapped. "This is the early days of this medium," he says. "Going there would be like being at RCA in the 1920s or NBC in the 1940s."
Not that Mr. Andreessen isn't comfortable where he is. He has a large house in an affluent neighborhood in Palo Alto, Calif., a fiancee, three bulldogs and a new kitten. He has personal investments in such start-ups as Replay Networks Inc., which makes devices that find and digitally store TV programs.
But he isn't eager to be a passive investor, finding himself impatient with an eight-week sabbatical that was interrupted by the AOL deal. If he doesn't get a technical job at AOL, he jokes about becoming a brand manager or the voice for "You've Got Mail." After the proposal was announced, he tried the familiar AOL phrase in a convincing basso profundo. "Not bad, don't you think?" he says.
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