About Netscape

The company was founded as Mosaic Communications Corporation on April 4, 1994 by Marc Andreessen and Jim Clark, and was the first company to attempt to capitalize on the nascent World Wide Web. It released a web browser called Mosaic Netscape 0.9 on October 13, 1994. This browser was subsequently renamed Netscape Navigator, and the company took on the 'Netscape' name on November 14, 1994 to avoid trademark ownership problems with NCSA, where the initial Netscape employees had previously created the NCSA Mosaic web browser. (The Mosaic Netscape web browser utilized some NCSA Mosaic code with NCSA's permission, and this was noted in the application's "About" dialog box.)

Netscape had a successful IPO on August 9, 1995. The stock was to be offered at $14 per share; a last-minute decision doubled the initial offering to $28 per share; the stock's value reached $75 on the first day of trading, which was nearly a record for a stock's first-day gain. The company's revenues doubled every quarter in 1995.

One of Netscape's stated goals was to "level the playing field" among operating systems by providing a consistent web browsing experience across them. The Netscape web browser interface was identical on any computer. Netscape later experimented with prototypes of a web-based system which would enable users to access and edit their files anywhere across a network, no matter what computer or operating system they happened to be using.

This did not escape the attention of Microsoft, which viewed the commoditization of operating systems as a direct threat to its bottom line. It is alleged that several Microsoft executives visited the Netscape campus in June 1995 to propose dividing the market (although Microsoft denies this as it would have breached anti-trust laws), which would have allowed Microsoft to produce web browser software on Windows while leaving other operating systems to Netscape. Netscape refused.

Microsoft released version 1.0 of Internet Explorer as a part of the Windows 95 Plus Pack add-on. According to former Spyglass developer Eric Sink, Internet Explorer was based not on NCSA Mosaic as commonly believed, but on a version of Mosaic developed at Spyglass (which itself was based upon NCSA Mosaic). Microsoft quickly released several successive versions of Internet Explorer, bundling them with Windows, never charging for them, financing their development and marketing with revenues from other areas of the company. This period of time became known as the browser wars, in which Netscape Communicator and Internet Explorer added many new features (not always working correctly) and went through many version numbers (not always in a logical fashion) in attempts to outdo each other. But Internet Explorer had the upper hand, as the amount of manpower and capital dedicated to it eventually surpassed the resources available in Netscape's entire business. By version
3.0, IE was roughly a feature-for-feature equivalent of Netscape Communicator, and by version 4.0, it was generally considered to be more stable on Windows, but not the Mac platform. Microsoft also targeted other Netscape products with free workalikes, such as the Internet Information Server (IIS), a web server which was bundled with Windows NT.

Netscape could not compete with this strategy. In fact, it didn't attempt to. Netscape Navigator was not free to the general public until January 1998, while Internet Explorer and IIS have always been free or came bundled with an operating system and/or other applications. Meanwhile, Netcape faced increasing criticism for the bugs in its products; critics claimed that the company suffered from 'featuritis' – putting a higher priority on adding new features than on making them work properly. This was particularly true with Netscape Navigator 2, which was only on the market for 5 months in early 1996 before being replaced by Netscape Navigator 3. The tide of public opinion, having once lauded Netscape as the David to Microsoft's Goliath, steadily turned negative, especially when Netscape experienced its first bad quarter at the end of 1997 and underwent a large round of layoffs in January 1998.