TO : FROM : DATE : Th e onli n e co n t e n t co m m i t t e e Wal t e r Isaa cs o n Ma r c h 23, 19 9 4 This is to up d a t e all of us on wh e r e thi n g s sta n d . Sinc e this is all a wo r k in pr o g r e s s , ple a s e tr e a t this inf o r m a t i o n as co n f i d e n t i a l an d in pa r t i c u l a r do no t disc u s s an y of th e s e thi n g s wit h pe o p l e ou t s i d e th e co m p a n y . Stra te gic options. A te a m co m p o s e d of Cur t Vie b r a n z , Bru c e Judso n , Lin d a Rolle an d m y s e l f ar e co n t i n u i n g to ex p l o r e , in co n s u l t a t i o n wit h pe o p l e at eac h of th e m a g a z i n e s an d divisi o n s , wh a t op ti o n s we ha v e for lev e r a g i n g ou r reso u r c e s on a co m p a n y - wid e basis in th e onli n e wo r l d . This incl u d e s tw o rela t e d issu e s : wh a t ou r str a t e g y sho u l d be wi t h exis t i n g onli n e ser v i c e s suc h as Co m p u S e r v e an d A m e r i c a Onli n e , an d wh a t we sh o u l d do ab o u t cre a t i n g ou r o w n ser v i c e th a t co u l d ta k e ad v a n t a g e of po t e n t i a l op p o r t u n i t i e s on th e Int e r n e t or ne x t - ge n e r a t i o n onli n e deli v e r y sys t e m s . Wit h re g a r d to th e firs t issu e , th e exis t i n g onli n e ser v i c e s , we ar e co m i n g to th e co n c l u s i o n th a t th e r e m a y be fin a n c i a l an d str a t e g i c ad v a n t a g e s to m a k i n g cer t a i n de a ls as a cor p o r a t e pa c k a g e . This co u l d giv e us m o r e co n t r o l ov e r th e o w n e r s h i p rig h t s to ou r m a t e r i a l , th e na v i g a t i o n a l to o l s we m a y wis h to de v e l o p , an d th e lisce n s i n g fee s we rec e i v e . Alr e a d y , AOL has co m e up wi t h an in t e r e s t i n g fin a n c i a l off e r , an d we ar e aski n g th e m an d ot h e r s to co m e up wi t h a va r i e t y of op t i o n s . In m y co n v e r s a t i o n s wi t h so m e of yo u , th e r e wa s a co n c e r n th a t suc h a str a t e g y co u l d disr u p t pla n s th a t so m e m a g a z i n e s ha v e for th e i r ow n onli n e de a ls or, in Ti m e ' s case , to co n t i n u e wit h a ve r y succ e s s f u l rela t i o n s h i p . First of all, we will tr y to assu r e th a t th e r e is a ge n e r a l co n s e n s u s th a t an y co u r s e we pu r s u e m a k e s sen s e for all of 1 us; seco n d l y , we will tr y to m a k e an y de a ls no n - excl u s i v e so th a t th e y do no t pr e cl u d e an y ot h e r tr u l y co m p e l l i n g op p o r t u n i t i e s . Wit h re g a r d to th e rela t e d issu e of ho w we pu r s u e th e ne x t ge n e r a t i o n of onli n e ser v i c e s , we ar e in th e pr o c e s s of desi g n e i n g an u m b r e l l a ser v i c e of ou r ow n (co d e n a m e d Callio p e ) th a t m a y exis t as a site on th e in t e r n e t . This ser v i c e wo u l d incl u d e ou r o w n co n t e n t , so m e co n t e n t we acq u i r e , an d lin ks to ot h e r pu b l i c l y ava il a b l e inf o r m a t i o n an d da t a b a n k s . It wo u l d also incl u d e na v i g a t i o n a l to o ls an d in t e r f a c e s th a t we desi g n or lice n s e . This str a t e g y allo w s us to pr e p a r e for th e diff e r e n t possi b l e wa y s th a t th e onli n e wo r l d m a y ev o l v e : a fe w co m m e r c i a l ser v i c e s suc h as AOL re m a i n i n g th e pri m a r y ga t e w a y s , doz e n s of co m m e r c i a l ser v i c e s arisi n g as no n - excl u s i v e ga t e w a y s , or th e Int e r n e t itse l f bec o m i n g a sea m l e s s m e t h o d of acce s s i n g m o s t co n t e n t an d ser v i c e s . Content . John Pap a n a k of Ti m e - Life, Te y m o u r Bo u t r o s - Gh a li of Ti m e Inc. Ve n t u r e s , An d r e w Ler n e r an d Th o r n e Spa r k m a n of Ti m e Wa r n e r Bo o k s , Br u c e Judso n an d I m e t this we e k to sta r t disc u s s i n g ho w we co u l d joi n t l y de v e l o p co n t e n t for suc h a ser v i c e . I ha v e also tal k e d to th o s e of yo u at th e va r i o u s m a g a z i n e s ab o u t co n t e n t possi b i li t i e s in yo u r ar e a . Wit h re g a r d to an y de a l wit h exis t i n g co m m e r c i a l ser v i c e s suc h as AOL, ou r co n t e n t an d na v i g a t i o n a l off e r i n g s wo u l d be res t r i c t e d by th o s e ser v i c e s ' s cur r e n t off e r i n g s an d te c h n i c a l ca p a b i l i t e s . For exa m p l e , an y na v i g a t i o n a l to o l s an d int e r f a c e s we de v e l o p m a y no t be wo r k a b l e on a co m m e r c i a l ser v i c e wit h 96 0 0 ba u d acc e s s, an d it m a y no t m a k e se n s e to lice n s e m a t e r i a l suc h as a sto c k or spo r t s tick e r wh e n pr o v i d i n g a pa c k a g e to an exisi t n g ser v i c e th a t alr e a d y has suc h m a t e r i a l . Pri m a r i l y we wo u l d be pr o v i d i n g ou r edi t o r i a l co n t e n t , so m e ad d i t i o n a l m a t e r i a l , an d th e m a n a g e m e n t of bull e t i n bo a r d s an d disc u s s i o n gr o u p s . We ar e wr e s t l i n g wi t h th e fac t th a t bull e t i n bo a r d s ar e no t easil y in t e r c o n n e c t e d fro m on e ser v i c e to an o t h e r . Th e s e sa m e 2 li m i t a t i o n s wo u l d ap p l y if we pu t all of ou r m a t e r i a l on ou r ow n ser v e r an d allo w e d th e exis t i n g co m m e r c i a l ser v i c e s to pr o v i d e a ga t e w a y to it. Ne v e r t h e l e s s , we see so m e edi t o r i a l ad v a n t a g e s in pr o v i d i n g all of Ti m e Inc.'s m a t e r i a l to g e t h e r an d cre a t i n g ne w wa y s to pac k a g e it th a t ar e suit a b l e for th e onli n e en v i r o n m e n t . 3