1. CREATING ONLINE COMMUNITIES: ISP & PORTAL SPACE

2. ISP: The Stakeholders Users ISP Telco ISP Buys Access Wholesale ISP Sells Access Retail Pays Telco for Usage Pays ISP for Access $ $

3. Consumer ISP: AOL Model Users AOL Local Telco AOL Sells Access & Value-added Services User Pays Subscription Fee to AOL $ $ ISP Controls the Market

4. Consumer ISP: European Telcos Users Telco ISP National Telco Telco Sells Access to Subsidiary ISP Sells Access Retail Pays Telco for Usage $ $ $ National Telco Controls Market ISP may Reduce Fees as they generate traffic for parent Telco

5. The Free ISP Model Users ISP Local Telco Buys Access Wholesale ISP Provides Free Retail Access Pays Alternative Telco for Usage $ $ Alternative Telco Provides Access Wholesale Shares Revenue with ISP Access Becomes Commodity

6. Diverging Paths for ISPs Convert to Portal Merge with TelcoFocus on Corporates

7. Portal Business Model Aggregate Users Advertisers E-commerce Content Providers Adv Revenue Transaction Fees

8. Portal Categories Horizontal Portals: Major Consumer portals targeting the widest possible audience  Yahoo!, AOL, Excite, Lycos Vertical Portals:  Industry Portals: Sector specific, targeting businesses for information, jobs  Affinity Portal: Targeting specific segments with common interests:  iVillage or women.com for women  Automall.com for car enthusiasts

9. Global Portals Emerge Three Portals Dominate US & Europe: Yahoo AOL MSN  US companies have successfully reproduced their business models in Europe  Yahoo largest portal in Europe, in the top two in three largest markets  National portals leader in their markets only

10. Industry Portals Targets a particular industry, providing information and dialogue platform Revenue from focused advertising Brings together the community and controls future transactional B2B initiatives Vertical.net has 57 communities now

11. Financial Portals Mainly for consumers Aggregate information from financial product providers Product category bases content management Revenue Model:  Referral fee  Transaction fee

12. Corporate ISP Value-added services in addition to access Custom pricing instead of commodity Common Services:  Web hosting: Design, Corporate brochure, e- mail  Co-location: Server/Router housing & maintenance Next Step: Application Service Provider

13. ASP Model Evolution of IT outsourcing; one standard application is used by many customers Benefits to Users  Lower Hardware costs  Software rental instead of s/w licence & upgrades  Save on hiring & retaining IT staff Drawbacks:  Integrity & Security of Data  Reaction of Software Vendors:

14. Players in ASP Space CORPORATES ISP Telco IT Services Software Co. Oracle, Microsoft IBM, EDS, CSC PSINet BT

15. ASP Categories Generic Service ASPs: Offering ERP or Microsoft office Specialize in Vertical Sectors: Offering sector-specific applications, such as Retail or Financial Services Specialize in Horizontal Services: Offering e-commerce applications