Microsoft, Disney Unveil Service
Thu Oct 24, 5:14 PM ET
By JIM KRANE, AP Technology Writer
NEW YORK (AP) - In a splashy fete in Central Park on Thursday, Microsoft Corp. chairman Bill Gates (news - web sites) and Walt Disney Co. chairman Michael Eisner announced the release of an upgraded MSN Internet service stocked with Disney's content.
"It's a real coup," Gates said, sharing a stage in the autumn-tinged park with Eisner and a pair of extras in Mickey and Minnie Mouse suits.
"We're going to gain a lot of share here," Gates said. "We're going to make a lot of consumers happy."
The two companies plan to share revenues from the dialup-only service, which includes a Disney-centric version of MSN and a smattering of free Disney content.
Neither company would disclose terms of the deal.
Gates also announced the latest MSN software, version 8.0, which adds new features — also included on the separate Disney-fueled version — as well as an improved version for those with high-speed access.
The two dial-up services cost $21.95 per month and use the same access telephone numbers, but employ separate software. Gates said broadband access costs $39.95 or $49.95. And for $9.95, those with alternate Internet access can subscribe to the MSN content.
Eisner said Disney's partnership hinged on Microsoft's inclusion of strident parental controls on children's' Internet use.
"We've been looking for a safer environment to take Disney to the next level," said Eisner, whose sharp tan suit contrasted with the casual Gates' usual open-necked shirt.
The combined Disney on MSN service includes subscriptions to Disney Adventures magazine and Disney's Blast, a premium online site for children.
Microsoft hopes Disney's distribution prowess will fuel its quest to boost its 9 million subscriber base, second among the world's Internet service providers. America Online, which last month released its own 8.0 service that bundles similar features, counts 35 million subscribers.
The MSN event, which included an invitation-only concert by pop star Lenny Kravitz, closely mimicked AOL's launch party at Lincoln Center earlier this month, featuring a performance by singer Alanis Morissette.
Eisner said Disney plans to market Disney on MSN at its theme parks, stores and on its DVDs and television shows. For its part, Gates said Microsoft will spend $300 million to market MSN 8.0.
Microsoft's marketing handiwork was already in evidence in Midtown Manhattan on Thursday, where public sidewalks were plastered with butterfly-shaped ads with the MSN logo.
A Microsoft spokeswoman said the company secured city permits to post the ads.
Microsoft intends its new software to cater to parents, who can receive a weekly e-mail detailing their children's online activity, including Web sites they visited or tried to visit and the e-mail addresses and MSN Messenger accounts of people with whom they corresponded.
The new service also adds improved e-mail filters and access to Microsoft's Encarta encyclopedia.
Disney tried once before to launch an Internet portal to compete with AOL, MSN and Yahoo. That effort, called Go.com, was abandoned after Disney decided that it diluted its key brands, including Disney and ESPN.
Eisner said he believed Microsoft offered the best technology for the new service. Disney already has a deal to deliver sports content to Microsoft's online users through ESPN.
