Reading this you would think "Here is a company Going Places !"
Netpliance Seeks I-Opener Kitchen Space: Spotlight (Update1)
By Anthony Massucci
Austin, Texas, April 24 (Bloomberg) -- Netpliance Inc. wants
to replace your can opener with its i-opener, a stripped-down
computer that lets you check your e-mail, surf the Internet or
even order a pizza with at the touch of a button.
``Forty percent of our customers keep it in the kitchen,''
said Munira Fareed, director of marketing at Netpliance. ``We're
considering making an attachment that will allow our customers to
mount it under the kitchen cabinet.''
Industry analysts say Internet appliances will fill our homes
as the role of the personal computer changes amid consolidation
that will bring movies, games, video and the Web into our living
rooms over television set-top boxes and flat-screen Internet
devices bring recipes and take-out ordering into our kitchen.
``I would say the Netpliance is one of dozens of Internet
appliances that will proliferate over the next few years,'' said
Jupiter Communications Inc. analyst Dylan Brooks. ``It's more of a
kitchen item versus a household item.''
Netpliance, which raised $144 million when it sold 8 million
shares to the public in March at $18 each, is pushing sales with a
$99 offer until Father's Day, June 18, then raising the price to
$199. Austin, Texas-based Netpliance makes money from a $21.95
monthly Internet access fee that can be ordered with the device.
Rapid growth of the Internet has spurred sales of devices for
limited online tasks, eliminating the cost and complexity of
personal computers, research analysts said. Demand will grow to
55.7 million units and $15.3 billion in sales by 2002, according
Framingham, Massachusetts-based International Data Corp.
Due to its low cost, consumers likely will buy the i-opener
instead of a second personal computer, Brooks said. ``You'll end
up spending less than it would cost for a PC.''
When you take the i-opener out of its box, you'll see the
flat screen framed by a gray casing. The 10.4-inch wide screen is
held up by metal legs and squats above a light-gray keyboard. In
all, it weighs about five pounds.
The device is equipped with the Internet service, a browser
and an electronic-mail account using a 56-kilobyte modem
connection. It connects, by itself, every four hours to get news,
weather and e-mail. The device also has channels for
entertainment, finance and sports information.
``They are trying to replicate the model that America Online
has now,'' Brooks said. ``In the longer term, Netpliance will make
more from money from e-commerce and advertising revenue than the
Netpliance fell 23/32 to 9 1/8 on the Nasdaq Stock Market and
have declined 49 percent from its first-day close of 22 1/16.
Unlike America Online, Fareed said, you don't have to sign on
or boot up the computer to use the i-opener. A key feature is the
unit's pizza key, located near the keyboard's space bar marked
with a graphic of a pepperoni pizza slice.
``When you hit the key, it will order pizza,'' she said.
For now the key works in towns with Papa John's International
Inc. outlets. By pushing the key, you're linked to the Papa John's
Web site that allows you to create an order that's relayed to the
nearest store for delivery. Eventually, the company expects to let
customers customize the key's function, for either cuisine or
reaching the nearest grocery.
Netpliance said it also plans to add buttons that take users
directly to popular electronic-commerce Web sites, such as eBay
Inc.'s online auction site. Last week, the No. 1 Internet
auctioneer formed an agreement to put an eBay key on the i-
opener's keyboard. Terms of the agreement weren't disclosed.
The i-opener design is simple and some hobbyists were
reconfiguring the device with $100 in parts to add personal
computer features. The company added a three-month minimum service
agreement, with a $499 penalty if not honored, and modified the
devices to prevent turning them into low-cost personal computers.
``We are interested in developing a collaborative
relationship with those who have reconfigured the device,'' Fareed
Netpliance is giving i-openers to some Linux software
developers, for example, to allow them to modify the device's
software and it plans to support other developers, who may want to
design software or attachments that work with the i-opener. Much
like the Palm Inc.'s Palm-branded handheld devices, the i-opener
has software and infrastructure that makes it easy for developers
to expand, Fareed said.
``We're operating system agnostic, we can use any of them.
Our software can run on various operating systems,'' Fareed said.
The i-opener opened the eyes of U S West Inc., which made an
undisclosed investment in Netpliance and plans to sell the device
its telephone and Internet customers. The regional phone company
was seeking a network appliance when it found the i-opener, said
Joseph Zell, former president of U S West's !nterprise Networking
Division. Zell became president and chief executive of Convergent
Communications Inc. on April 5.
``We think there is a huge market for people who are not
interested in being PC Web users because of the hassle factor and
the cost factor,'' Zell said last month. ``So I guess from (U S
West's) standpoint, there isn't any question that there's a huge
market (for appliance products).''
Quanta Computer Inc., the world's No. 2 maker of notebook
computers, makes the i-opener for Netpliance. The company, which
makes laptops for Dell Computer Corp. and Hewlett-Packard Co.,
expects to produce between 10,000 and 100,000 appliances monthly.
Tim Li, chief financial officer at Quanta, said the i-opener
is the ``latest cool gadget that serves as a gateway to Internet
content and a median for e-commerce.''
If the i-opener replaces the under-the-counter can-opener, it
won't open soup cans, Fareed said, but it has opened eyes and it
may be providing a look into the future.
Hmmmm 10 to 100 thousand a month ! If they make that many every /.er could have one and still not make a dent in their bussines plan .....