December 11, 1996 6:00 PM ET
ISPs, desktop info delivery services poised for big profits
By Maria Seminerio

  Studies released this week by The Yankee Group Inc. and The Business Research Group predict that by the year 2000 there will be a boom in the markets of desktop content delivery and Internet and intranet access.

The Yankee Group's "Desktop Delivery Economy" report, released today at Internet World in New York, predicts that by the year 2000 some 30 percent of all Internet revenues, or $5.7 billion, will be made by providers of information-push technologies.

The report predicts that the best-known push services, PointCast Inc.'s PointCast Network, which delivers information to the user's desktop in a screen saverlike format, and Marimba Inc.'s Castanet system, will face increasing competition in a crowded field.

As industry giants step into the fray -- with Microsoft Corp. developing its Active Desktop strategy and Netscape Communications Corp. putting the finishing touches on its Constellation architecture -- content developers will have an even greater opportunity to bring their creations to corporate desktops, according to the report.

BRG's report on "Vendor Opportunities in the Internet Service Provider Market," released Monday, estimates that the commercial Internet products and services market, combined with the market for intranet services provided by ISPs, could exceed $24 billion by 2000. The report was based on a survey of 60 U.S. ISPs that employ more than 800 workers and that have been in business for more than five years, BRG officials said.

Local ISPs that offer few services aside from Internet access are imperiled by large telecommunications providers' entrance into the ISP space, the report concludes.

"Most local and regional providers are unable to keep up with corporate demand, marketing power and bandwidth requirements to compete with the telephone and cable companies and national service providers," the report states. Flat-rate pricing offered by large ISPs also threatens to shrink the overall number of providers, BRG officials said.

The BRG report is available by calling (617) 558-4609. BRG is based in Newton, Mass. More information on reports by The Yankee Group, based in Boston, is available at www.yankeegroup.com/.

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