Spyglass, Inc.

» see spyglass.com as it lived, on the wayback machine

~ the obit ~

Spyglass was founded in 1990 in Champaign, Illinois, by people commercializing software from the National Center for Supercomputing Applications at the University of Illinois. The first products had nothing to do with the web. They were graphing packages and 3D rendering engines for scientists whose data was too large to look at directly, sold to customers who already owned a workstation. The company later moved up to Naperville and would have stayed a respectable Midwestern software business if the same building had not also produced Mosaic.

In May 1994 Spyglass licensed the Mosaic browser from the NCSA for several million dollars. What the university had was three separate programs that shared a name: the Unix, Windows and Macintosh versions had different features and different code underneath them. Spyglass rewrote it as one codebase with the platforms sharing almost everything, which is the part that made it sellable. It never sold to the public. There was a thirty-day trial you could download, but the actual business was licensing the code to companies that shipped it under their own name, and O'Reilly, CompuServe, IBM and Ipswitch all did.

The company went public on 27 June 1995, two million shares at $8.50, closing the first day at $27.25. That made it the first internet software company to hold an IPO, six weeks ahead of Netscape, and for about a month it was the purest way for a public investor to buy the web. Nobody knew what any of it was worth yet, which turned out to be the important fact about the whole period.

Microsoft had tried to buy a browser from BookLink in November 1994 and lost it to AOL. In January 1995 it licensed Spyglass Mosaic instead, and that code shipped in August as Internet Explorer 1.0 inside the Microsoft Plus! pack for Windows 95. The terms were a per-copy royalty against a quarterly minimum, which was a perfectly normal way to license software to a company that sold software. Internet Explorer was never sold. By 1997 Spyglass was threatening a contractual audit, and on 22 January Microsoft settled for $8 million, $7.5 million of it cash and the rest in software and services, converting the deal into a fully paid-up license and ending the relationship.

~ the rap sheet ~

~ a royalty on a free product ~

The mistake is easy to name in hindsight and was nearly invisible in January 1995. Every software contract of that era assumed the licensee would charge for the thing, because charging for the thing was how software worked. A browser given away as a bundled component of an operating system, funded by what it protected rather than by what it earned, was a business model nobody had a clause for yet. Spyglass got the quarterly minimum, which is what you write down when you assume the real money will come from volume.

What followed was not a small miss. Internet Explorer went from a $5 add-on pack to the default on more than nine out of ten desktops on earth, and the company that supplied its original rendering code took a one-time eight million dollars and went looking for another market. Spyglass spent its last years selling embedded browsers for set-top boxes and phones, which was a genuinely good bet on where browsers were going and about ten years early.

~ the browser everyone here used ~

Internet Explorer arrived in Turkey as the condition of the machine rather than as a choice anyone made. It was what sat on every internet cafe desktop in Ankara between 2002 and 2005, and Turkish banking and state sites were built against it for another decade after that, which is why people here were still being asked to install an ActiveX control long past the point where that was defensible. The rendering code underneath the first versions of it was licensed from a company in Illinois for a fee that ran out.

~ the about box ~

OpenTV announced on 26 March 2000 that it was buying Spyglass in a stock swap valued at $2.5 billion, intending to put the Prism server software behind interactive television. The deal closed on 24 July. Anyone who took OpenTV shares in that swap watched the valuation come apart over the following eighteen months along with the rest of the sector. OpenTV itself was absorbed by the Kudelski Group on 29 March 2010.

The credit outlasted the company. Internet Explorer 6 and everything before it carried an acknowledgement of Spyglass and NCSA Mosaic in the About panel, sitting in a dialog box on hundreds of millions of machines long after the entity named in it had been folded into an interactive television company. Microsoft removed the line in Internet Explorer 7 in 2006, which is the last date on the record.

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