ClariNet

1989 - 1997
dead us
brad templeton noticed that people were retyping dave barry's newspaper column onto usenet every week and drew the commercial conclusion, which was that a market existed. clarinet launched on 8 june 1989 selling wire copy as newsgroups, billed the universities and companies that already carried a news feed, and turned a profit in its second year without raising a dollar. it has a real claim on being the first business built to live on the internet. it sold in june 1997 for about eight and a half million dollars of somebody else's falling stock.

~ the eulogy ~

The thing that started ClariNet was copyright infringement against a humor columnist. Dave Barry wrote for the Miami Herald, somebody typed his column into Usenet every week without asking anyone, and it traveled further and faster that way than the newspaper had ever managed on paper. Brad Templeton read that as a demand signal rather than as a crime, and in June 1989 he announced a service that would push news down the same pipe legally, for money.

The delivery mechanism was the clever part. ClariNet did not build a site or a client or a protocol. It created its own Usenet hierarchy, clari.*, sitting outside the Big 8, and shipped licensed wire copy through it over the same UUCP and NNTP plumbing that already moved every other newsgroup on earth. If your site paid, your news server carried the groups and your users read the Associated Press in the same window where they read arguments about text editors. Nobody had to install anything.

It carried UPI and Newsbytes at the start and moved to the Associated Press and Reuters in 1994. It also carried Dave Barry himself, properly licensed this time, and Dilbert, and a database of street prices for computer parts. The money came in as site subscriptions priced by how many people were behind the feed, which reached something like 1.7 million paid seats by the end, though Templeton has been honest that actual readership ran nearer a sixth of that.

By the time I had a modem in 1998 ClariNet was already a year sold, and I would not have reached it regardless. A licensed hierarchy is only on your news server if whoever runs that server signed a contract for it, and a Turkish dial-up account in 1998 got you the free groups. So this is one I know as history rather than as somewhere I went, which is the honest position for most of what happened on Usenet before the web arrived.

~ the dossier ~

Born8 June 1989, announced by Brad Templeton out of Waterloo, Ontario
Peakup to 1.7 million paid subscriber seats, top of Inc's 1996 dot-com list
KilledJune 1997, sold to Individual Inc
Lifespaneight years
Made byBrad Templeton, who had already written and sold a spreadsheet compiler
Killed bythe web, and a sale paid in the buyer's depressed stock

~ how it was paid for ~

There was no venture capital. Templeton had written a spreadsheet compiler and done a bundling deal with Intel, and the cash from that seeded the company. ClariNet was profitable in year two and stayed that way, which in the history of internet news businesses puts it in a category with almost nothing else.

The pricing worked because the customers were institutions with existing news servers and existing budgets. A university or a corporate site paid once for everybody behind it, and the marginal cost of another reader was zero because Usenet flooding had already solved distribution. It is the cheapest content delivery network anyone ever ran, and it was free because somebody else had built it for other reasons.

~ the first dot-com argument ~

Templeton's claim is careful rather than loud. He defines a dot-com as a company born to use the internet as its business platform, admits the answer depends on where you draw that line, and says ClariNet has a claim rather than the claim. That is more restraint than most people in this graveyard managed about anything.

The case for it is strong. In June 1989 there was no web, no browser, and no commercial traffic allowed on the NSFNET backbone at all, which is why ClariNet ran over UUCP and the commercial networks that surrounded it. Building a company whose product only existed as internet distribution, at that date, was not an obvious thing to do.

~ how it ended ~

Individual, Inc. bought ClariNet in June 1997 for roughly $8.5 million, paid in Individual's own stock, which was already depressed. Individual merged with Desktop Data in 1998 to form NewsEdge and Templeton left. The business drifted on through further owners and ended up at Yellowbrix, and the clari.* groups thinned out on news servers through the early 2000s until they were simply not carried anywhere.

What killed it was the obvious thing. In 1989 getting wire copy onto a screen was hard enough that people paid a company to solve it. By 1997 every wire service had a website and the news was free, and a paid newsgroup hierarchy was an expensive way to receive something a browser would hand you for nothing.

~ the long tail ~

ClariNet's other appearance in the record is legal. It was a plaintiff in Reno v. American Civil Liberties Union, the case that took down the Communications Decency Act, and Templeton testified about what the law would mean for anyone publishing to a network. The decision was unanimous and it is the reason a great deal of what came after was allowed to exist.

The delivery idea did not survive but it keeps getting rebuilt. A publisher hands content to a syndication layer, the layer floods it to everyone subscribed, and the reading happens in a general-purpose client rather than on the publisher's property. That is RSS, and it is podcast feeds, and it is roughly what ClariNet was doing in 1989 with the only flooding network that existed at the time.

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other news: K2Kapital, Firedoglake, PenToy, USgamer

also died in the 1990s: Erols Internet, CSNET, Brøderbund

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