Double Dealmaking in the Browser Wars (a)

Double Dealmaking in the Browser Wars (A)

Heyine Park 2008122027

Assignment Questions

1. How did each of Netscape, AOL, and Microsoft see their negotiation in terms of their perceived interests, no-deal alternatives (BATNAs or Best Alternatives to Negotiated Agreement), and a zone of possible agreement? Evaluate Netscape’s performance in the negotiations with AOL. Specifically, what did they do well? Poorly? Why? Evaluate AOL’s performance in the negotiations with Netscape and/or Microsoft. Specifically, what did they do well? Poorly? Why? Evaluate Microsoft’s performance in the negotiations with Netscape and/or AOL. Specifically, what did they do well? Poorly? Why?

The contract that has been settled between MS and AOL is a very successful one in all aspects. MS' search engine Explorer and AOL's software will be totally integrated and users will be able to use it without problems readjustment. Furthermore, as far as AOL is concerned, the benefits are very attractive in terms of cost reduction and savings because the MS is willing to care of it all.

On MS's interest point of view, by becoming partners with AOL, it aims to settle Explorer as the default browser which will help MS gain presence in the market. There was indeed a huge opportunity cost(money MS had poured to MSN) that MS had to embrace but taking into consideration that every single joiner will have to use Internet Explorer as their browser.

Then what about Netscape? what did it do wrong or poorly? Indeed, before and after the contract between MS and AOL was settled, Steve Case invites Jim Barksdale to have new partnership but Netscape declines. The reason for the double contract seems to come from the attitude Netscape had towards AOL. Indeed, to every suggestion AOL put on the table, Netscape were reluctant. We can presume that Netscape was acting too haughtily because of they thought that their relationship with AOL was geared towards them in terms of power. AOL have in the past constantly wooed for potential merge. AOL viewed Netscape as a partner whereas Netscape viewed AOL as a mere customer. Netscape seem not to have well understood the meaning of merging because this consists of a committed relationship where technologies are shared and one learn from the other and vice versa. Furthermore, during the whole negotiation process, what differentiates AOL and Netscape the most is the fact that AOL always bear in mind that the deal is a three party negotiation whereas