Snap Out of It: NBCi Launches Broadband Portal, NBCi.com

NBC Internet (NBCI Quote) outlined Monday how it is readying itself for the Internet of the future. And it wasn't a Snap decision.

Preparing for a world in which most U.S. homes will have fast Internet connections, NBCi -- operator of the Xoom.com community site and various NBC-affiliated Web sites -- Monday launched an all-purpose starting point, or portal, targeted at Internet users with high-speed, or broadband, online access. But instead of using the name of its current portal, Snap, the company has decided to call the new site NBCi.com.

The choice to go with NBCi.com is an acknowledgment of how difficult it is to create memorable brands on the Internet, and of the stakes in the broadband online game, which in coming years stands to be potentially far more profitable than narrowband Internet.

Internet Dinners?

The name aside, the launch of NBCi.com signals a coming clash among several companies seeking to develop destinations for a growing audience of Internet users with broadband connections. The battle corresponds with the ongoing competition between dial-up, or narrowband, portals, in which Yahoo! (YHOO Quote) and America Online (AOL Quote) are the reigning champions. Chief competition for NBCi in the broadband arena, says NBCi President Edmond Sanctis, includes AOL, which is developing AOL TV, a television service that includes interactive features of AOL; Yahoo!, which acquired online broadcaster broadcast.com in February; and Excite@Home (ATHM Quote), which combines the Excite portal with the @Home high-speed cable modem service.

Snap, Crackle, Pop A big branding decision for NBCi

Source: BigCharts

The branding decision, says Sanctis, reflects the growing understanding among Internet companies and consumers that the Internet and television are slowly converging. Among its other qualities, Sanctis says, TV is reliable and it's everywhere. "We want to take the attributes people love about TV, and bring them to the Internet," he says.

Though Snap has been around for more than two years, and NBCi has previously called Snap its flagship Web site, NBCi has decided that the venerable NBC brand is better equipped for easing the company into an age of high-speed, instant-on Internet connections. (Snap, launched in September 1997 by CNet (CNET Quote), was rolled into NBCi late last year, when NBCi commenced operations.)

Flash in the Pan?

It will likely take years for the high-speed fight to play out. About 9% of people visiting NBCi properties from home computers have high-speed Net connections, according to Nielsen/NetRatings. But, says Sanctis, the number of these visitors to the company's sites is growing quickly. Citing projections that by the end of the decade a majority of home users will have high-speed connections to the Internet, Sanctis says, "You've got to be in it now."

In launching the NBCi.com portal, NBCi is announcing a long slate of content partners that will provide video, audio and other content and services, ranging alphabetically from A&E Network to Women.com Networks (WOMN Quote). In addition, the company has struck a number of distribution agreements with high-speed Internet service providers; for example, a version of NBCi.com, says Sanctis, will be the default home page for people who sign up for high-speed digital subscriber line service through Bell Atlantic (BEL Quote).

To help distinguish itself from other high-speed portals, says Sanctis, the company is relying heavily on Macromedia's (MACR Quote) Flash software for presenting sound and graphics. NBCi is using Flash, for example, as the basis for a customizable navigational tool, or "dashboard," on its site.

Rich Get Richer?

The business appeal of broadband, says Sanctis, is "the economics are much richer." NBCi, he says, is able to charge broadband advertisers triple what it can charge for conventional narrowband ads. And because the company is aggregating content developed by others, he suggests, the additional revenue to NBCi isn't eaten up by added production costs.

Jordan Rohan, media analyst for Wit SoundView, says the decision to forgo Snap makes sense for NBCi. "It's very difficult to create online brands," he says. "Certainly the NBC brand is more recognizable than Snap." (Rohan doesn't follow NBCi, though he covers other Internet portals.)

But Rohan thinks it will be difficult for NBCi and other companies to devise broadband programming that's compelling -- that takes full advantage of the interactive nature of the Internet and its ability to conduct transactions. "Broadband programming really needs to evolve to differentiate itself clearly from the programming you get at a movie theater or on your television," he says. "This is going to take years."