Microsoft were fairly slow to discover the success of the Internet. Netscape develop web browsers for many different operating systems and Microsoft were surprised by their success and realised the Internet had potential after all. They decided to compete with Netscape using the monopoly they have on desktop Operating Systems to their advantage. The licenced the Mosaic web browser from a company called Spyglass. This became what is known today as Microsoft Internet explorer (MSIE). Spyglass ran into financial difficulties because Microsoft decided rather than to sell the browser where Spyglass would get royalties - they decided the only way to compete with Netscape was to give the browser away free.
At the time Netscape charged for their web browsers as the sales of web browsers was their main income and without it they would go out of business. Microsoft introduced Microsoft Internet Explorer 2 around the time of the Windows 95 launch. They initially included it as part of the Plus pack of useless add ons for Windows then they made it a free download and eventually they included it with Windows 95. MSIE2 was very poor compared to Netscape Navigator 2 and so although Microsoft were giving their browser away free, Netscape was still the most popular browser.
Microsoft then realised that they couldn't take over Netscape's position just by giving their product away free so they spent millions on research and design to produce version 3. This release was almost approaching the standards of Netscape's browser so market share was growing for Microsoft but Netscape was still the undisputed leader despite the fact Netscape didn't even have half the money Microsoft put into developing MSIE3. To encourage more people to use their browser Microsoft actually paid websites to provide MSIE exclusive content as well as paying ISPs to distribute their browser to their customers rather than Netscape. Despite all this Netscape still remained the most popular web browser but their income was drastically slipping.
The major battle occurred with the release of the version 4 browsers. Microsoft had tightly integrated MSIE4 into the operating system and added some new features. Of course integration with the Operating System meant that every machine with Windows on it had to have MSIE installed on it with it set to the default browser. This made life extremely difficult for Netscape so they announced their browser was also going to be free and they'd get their revenue from advertising on their web site and sales of server software. Only the future will tell if Netscape will survive Microsoft's hard handed tactics but they have done so well to survive so far and hopefully they will do so in the future. Help them as much as you can download their browser. Visit their site and lets just hope that Netscape will be around for a long time to come.
For those who think Microsoft were competiting fairly just remember that Microsoft had income from a wide variety of sources such as sales of Windows and its Office applications. Netscape just had the income of its servers and browsers. Netscape couldn't spend the amounts of money that Microsoft could. Netscape is just an example of a company that has faced Microsoft's unfair business tactics so have many others. A few you'll read about in my Operating Systems section.
Of course there's more to the Internet than just web browsers. The servers that provide our Internet content have also suffered from the Microsoft treatment. Using unfair licencing on the Windows NT Server product and giving their IIS web server away free has affected the sales of other companies that make Web Servers for Windows NT. They've also produced proprietry Front Page Extensions that are produced if you created a web site created with the Microsoft Front Page web site development tool. If you try to upload your site to a server that doesn't support Microsoft Front Page then your site won't work properly. This makes a Front Page user unhappy and normally they'll blame the host of their site rather than Microsoft. This pressurises the host into supporting the Front Page Extensions. Microsoft also own a lot of other Internet services. None of them were their innovation they just used their seemingly endless financial reserves to buy out successful companies. An example was the web based email service Hotmail, which antiMicrosoft used to use for email, but since December 1997 it has been owned by Microsoft and now forms a collection of MSN sites.
Microsoft also bought out the WebTV network which as recently admitted to invading its custiomers privacy. It just proves that you should never trust Microsoft!
Previously on antiMicrosoft:
Internet Exploder - Why I hate MSIE (et en français)