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By Carolyn Duffy Marsan
Network World, 05/27/02

When keywords became available in Microsoft’s Internet Explorer two years ago, they offered companies a simpler way for their customers to find information about their products and services on the Web.

Now the recent closure of RealNames, the Internet’s premier provider of keywords, leaves the technology’s future in doubt even as the Internet Engineering Task Force (IETF) is finalizing a standard for resolving keywords.

Major corporations such as IBM, eBay, Ford, Bank of America and Xerox use RealNames’ keyword service, which will remain operational until June 28, to help customers find product information on their Web sites. For example, a user could type the keyword “ThinkPad” in the browser command line and go directly to the appropriate page of IBM’s Web site without needing to know the corresponding URL.


However, the technology’s greatest promise was in resolving queries for non-English language domain names, especially in such complex languages as Arabic, Japanese, Chinese and Korean. Among the Asian companies that used RealNames’ keyword service to ease user navigation were Sony, Nomura Security and Haier Group.

“The closure of RealNames, the company, is fundamentally a measure of business-level process, not a statement about keyword technologies,” says Leslie Daigle, chair of the Internet Architecture Board and leader of the IETF’s keyword resolution effort. “It has more to do with decisions made in various boardrooms than whether people want, or will supply, keyword services.”

RealNames ceased operations May 13 after Microsoft chose not to renew a contract to distribute the RealNames keyword service with its browser. Microsoft made this decision even though it owns 20% of RealNames, which is in the process of liquidating assets.

Also losing out in this surprise turn of events is VeriSign, which owns 10% of RealNames and was a reseller of its keywords. VeriSign plans to write off an $18 million investment in RealNames and must come up with another solution for resolving the 1 million foreign-language domain names it has registered.

RealNames founder and CEO Keith Teare says the company was at a break-even point and has $12 million in cash. The company owes Microsoft approximately $25 million and plans to sell its physical and technological assets related to directory services, multilingual domain name resolution and messaging services.

“We put all our eggs in one basket very consciously,” Teare says. “With Microsoft as a 20% shareholder and with significant revenue share going to Microsoft, we thought it was a pretty safe basket.”

RealNames had sold more than 200,000 brand-name keywords. During March, RealNames’ keywords were accessed 187 million times, company officials say.

“Keyword technology is being killed by Microsoft, and it has absolutely no chance of being re-created unless they’re prepared to help,” Teare says. “Their browser is used by a half-billion people, and it sits between the user and the content. If their applications don’t support keywords, then keywords don’t exist.”

Keywords are “the human-facing component that the geeks who built the Internet forgot to make,” says Michael Mealling, an engineer with VeriSign who helped author several IETF documents related to keyword resolution. “The Internet really became popular before we finished the thing. And it was used primarily by geeks who didn’t have a problem with [long HTTP addresses]. So now that our grandmothers want to use it, we have to build that human component into it.”

The demise of RealNames leaves only a few small keyword providers standing: the U.K.’s CommonName, a Chinese portal-based keyword system called 3721 and a Korean-language service called Netpia. Meanwhile, AOL Time Warner offers a proprietary keyword service to its users.

Companies spent $500 per year to register a RealNames keyword, with volume discounts available for large customers such as eBay, which had about 3,000 keywords in the RealNames system. These large customers paid RealNames from $50,000 to $500,000 per year.

Supporters of keyword technology say RealNames failed in part because it was a closed, proprietary service offered by a single company.

Ironically, RealNames is closing just as the IETF appears ready to approve a standard for keyword resolution. RealNames engineers helped create the standard, which is called the Common Name Resolution Protocol (CNRP). Daigle, who served as chair of the CNRP working group, says the IETF’s leadership has approved the CNRP documents and will publish them soon.

Whether a new player will enter the keyword market remains to be seen. RealNames executives were angered last week by the discovery that Microsoft recently was awarded its own patent for a keyword system. Microsoft declined to comment about the patent it has on keywords.

Some observers predict new keyword services will be hard to finance in today’s economic climate.

“Keywords is another layer above the basic resolution. It is an option. So the key question is: Do we really need it?” asks Marc Blanchet, co-chair of the IETF’s Internationalized Domain Name working group and an engineer with Viagenie. “This is a great technology but . . . some technologies that are not essential sometimes never get the market [support].”


Location: San Carlos, Calif.
Founded: 1997
Original name: Central Corp.
Products: Keyword registration and resolution service.
CEO: Keith Teare
Financing: Venture capital raised $133M in four rounds; Microsoft 20%, VeriSign 10%.
Status: Ceased operations, liquidating assets.

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Keith Teare

Keith Teare is a Silicon Valley based, UK born, entrepreneur. He was involved at the founding of Accelerated Digital Ventures, Archimedes.Studio, RealNames and EasyNet. He was also founding shareholder in TechCrunch. He is US Managing Partner at ADV.