AOL and Sun announced that they have entered into a strategic
alliance to accelerate the growth of enterprise class e-commerce,
and to use Sun's Java technology to develop selected Internet
devices that will help Internet users access America Online
brands from anywhere, anytime.
The alliance follows America Online's announcement
that it will acquire Netscape Communications Corporation.
Under their definitive three-year development and marketing
agreements, America Online and Sun will work together to develop
the most comprehensive suite of easy-to-deploy, end-to-end
solutions to help companies and Internet service providers
rapidly enter the e-commerce market and scale their e- commerce
operations. Sun will become a lead systems and service provider
to America Online, with America Online committed to purchase
systems and services worth $500 million at list price from Sun
through 2002 for its e-commerce partners and its own use.
America Online will receive more than $350 million in licensing,
marketing and advertising fees from Sun, plus significant minimum
revenue commitments, over the next three years.
Complementary E-Commerce Strengths
The companies said that their strategic alliance will take
advantage of the complementary strengths of America Online, Sun
and Netscape. These include America Online's success as an
Internet service provider and its industry- leading consumer
reach, Sun's expertise and global reach as an enterprise software
and network computing leader, and Netscape's suite of e-commerce
software and services. Together, the companies will be able to
offer complete turnkey solutions along with modular software
flexibility and consulting services to enable e-commerce partners
to put their businesses online quickly and scale rapidly to meet
The new offerings will allow customers to completely outsource
their electronic commerce operations, with America Online
providing everything from Internet traffic and application
connectivity to online marketing, orders, billing and payments.
Sun and America Online will also market their e- commerce
solutions to customers, including other Internet service
providers, who want to create part of the solution themselves.
The products will be available on Sun's Solaris operating
environment as well as on other operating systems.
Sun will initially be able to sell AOL's Netscape-branded suite
of middleware software, with both companies using each other's
sales channels and customer relationships to market their
existing products and services. As new products are developed,
both companies will sell the next-generation e-commerce
solutions. Sun's large sales and service organization will
provide technical support for these products and services.
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