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A Place to Hang Your Hat in Cyberspace--Eventually

September 08, 1997|JONATHAN WEBER

Michael Egan made a mid-nine-figure fortune building Alamo Rent-A-Car into an industry powerhouse, and though he isn't much of a gear-head, his decades in the travel business convinced him that we haven't even begun to see the changes that will be wrought by information technologies.

And so last month, Egan invested $20 million in WebGenesis/The Globe, a New York-based Web venture founded by two 23-year-old Cornell University graduates. His advisors were dubious: "They said, 'For what it is, it's neat, but have you lost your mind?' " he recalls with a chuckle.

In fact, it's not immediately obvious just what the Globe is. Egan and his fresh-faced business partners, Todd Krizelman and Stephan Paternot, grab hold of one of the most overused terms in the technology universe in describing it as a "virtual community."

It's become almost de rigueur on the Net these days to say that you're building "community." If you're selling books or computers, you're creating a community of book or computer lovers. If you're offering personal ads, you're developing a community of single people. If you're America Online, you're nurturing a community of 9 million Net surfers.

The descent of the term into a kind of tautology is unfortunate, because creating new kinds of community is one of the great promises of the Internet. The primary definition of "community" might be explicitly geographic, but if you think of cyberspace as a place, it's one in which human association can transcend the tyranny of physical place.

What the Globe and other Web ventures, ranging from America Online to Santa Monica-based GeoCities, are doing is not so much creating community as providing tools for the creation of community. And people are beginning to use those tools in large numbers.

The Globe's specialty has been "chat" service: It developed technology that works better than most Web chat software, and it has created an environment that makes people comfortable chatting. It also provides other services--instant messaging and e-mail, personal home pages, games, shopping and even a little news--with the aim of becoming members' home base in cyberspace.

The site claims more than 600,000 registered users, some of whom pay $25 a year for a premium membership that offers special features. Krizelman and Paternot consider the competition to be America Online and the Microsoft Network, even though Globe members must buy their Internet access somewhere else.

Though it started from a very different place, GeoCities has many of the same aims. Its original proposition was simple: free home pages, organized in thematic neighborhoods, using a geographic metaphor of streets and houses.

Interested in the arts? You can set up your home page--displaying just about whatever kinds of text and pictures and graphics you'd like--in Soho or Paris. Wine lovers might opt for the Napa Valley. Sports fans can head for the Colosseum or Yosemite.

Again, the idea is to establish the site as people's home in cyberspace, and it seems to be working. GeoCities, which has attracted more than $11 million in venture capital funding, is closing in on 1 million "homesteaders," and with more than 2 million visits per day, it is one of the most-trafficked sites on the Internet.

"We give people the opportunity to connect with people of similar interests," GeoCities founder David Bohnett says. The site is not so much a community as a meta-community, a collection of many different groups of people with similar interests.

This concept accounts for the success of America Online as well. Even with all of its well-publicized busy-signal problems and continued predictions from some corners that it's in for a precipitous fall, America Online continues to grow rapidly. Why? Because AOL is easy and convenient to use.

Internet access providers, and even search sites such as Yahoo, are trying to develop similarly appealing interfaces and tool sets. But the success of GeoCities and the Globe indicates that many Web surfers are looking for something that they aren't getting from their access company.

Egan says the evolution of online communities will, in critical respects, emulate communities in the real world. The earliest human communities provided for procreation and socialization, and for common procurement of food and shelter and common defense, he says, "and these societies evolved, constantly giving more services to their members, until you get present-day San Francisco."

San Francisco, or any big city, also is less a community than a collection of communities with a set of opportunities and facilities (think tools and services) in common. Once you adapt to how things are done, and begin to use what the city has to offer, you tend to want to stay.

For this to happen, people must be willing to pay some taxes--be it property tax (subscriptions) or sales tax (a cut of transactions). Or they must be willing to put up with lots of billboards along the streets and in their frontyards (advertising).

How all that will work out remains to be seen. For all their traffic, these businesses are still small. GeoCities expects to have $5 million to $6 million in revenue for this calendar year, mostly from advertising. The Globe, though it won't provide figures, is likely to be well below that; it's counting on paid subscriptions as its key revenue source.

But if the theory behind these ventures is even close to being right, they'll naturally take a long time to develop. After all, neither Rome, nor any other meta-community, was built in a day.


Jonathan Weber ( is editor of The Cutting Edge.

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