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CAN MINOR STRIKE GOLD? | PAGE 2 OF 2
CNET was launched in December 1992 with $50,000 in seed money and has grown into one of the leading new media companies -- a publishing concern that doesn't produce a scrap of paper. Since going public in 1996, CNET's properties have been multiplying like viruses -- it currently operates 11 Web sites devoted to computers and technology. The relentless growth of CNET properties has begun to focus attention on the company's young founder. Forbes ASAP spotlighted Minor as one of its "30 Who Matter." Business Week crowned him "online emperor," naming Minor as one of their "Hot Entrepreneurs" for 1998. Of course, only on the Net can one of the hottest entrepreneurs in the industry be someone who hasn't made a penny in profit yet. CNET lost $24.7 million last year, about $7 million more than it lost the previous year. However, CNET's revenue more than doubled over the past year, and Minor says he's optimistic that CNET can turn a profit by year's end. (Minor owns about 20 percent of CNET, as does Microsoft co-founder Paul Allen's Vulcan Ventures; Intel owns 6 percent.) These days, the Net is more about potential than profit, and Minor has already distinguished himself as a man with global aspirations. "He's sort of the Ted Turner of the Internet," says Sky Dayton, founder of EarthLink Network Inc., and a friend of Minor's. "He's got a big dream and isn't afraid to take risks. He's building a lot of things at once. He knows what he wants and he isn't shy about going out and getting it." Like Ted Turner, Minor seems to thrive on continually raising the stakes, parlaying one media property into a series of new ventures. Just as Turner successively created new cable channels -- TBS, CNN, TNT, the Cartoon Channel and Turner Movie Classics -- by reinvesting his profits, Minor has leveraged a small village of Web sites and TV programs into a teeming subcontinent of CNET-branded properties.
The man behind CNET is disarmingly boyish in appearance. At 33, he still looks young enough that any sensible bartender will ask him for ID before serving him. From his glistening wire-frames down to his pleated pants and sensible loafers, Halsey McLean Minor looks as well-bred as his name sounds. His grandfather's first cousin was Admiral Bill Halsey, the commander of the Allied Naval forces in the South Pacific during World War II (later immortalized in one of the most annoying pop songs of all time, Paul McCartney's "Uncle Albert/Admiral Halsey"). Minor grew up amid the horsy set in Virginia, where he sealed his preppy credentials by attending prep school. But he didn't attend the boarding school favored by his family; instead he chose a rival school that had a mini-computer. "I was kind of a closet nerd as a kid," says Minor. "I played football, but I'd lock myself away in the computer room and program for hours. I loved reading all the computer magazines." After graduating from the University of Virginia with a degree in anthropology, Minor worked for Russell Reynolds executive search company, and then in investment banking for Merrill Lynch Capital Markets in New York. But he always dreamed of building his own company. When he was in his early 20s, Minor started a company with the most impressive name he could dream up: Global Publishing Corporation. The business wasn't exactly global, since it had only one client, Merrill Lynch. And it wasn't really a publishing business, but rather a firm that produced business training material over computer networks. And come to think of it, it wasn't actually a corporation. Global Publishing Corporation didn't last long enough to live up to its lofty name, but it revealed an attitude that Minor has since refined into a long-term business strategy: Don't be afraid to think big. A decade after pretending to be head of a global publishing corporation, Minor has become something resembling the real thing. "I think I've always wanted to build a large, substantive company," says Minor. "You always kind of think it's a pipe dream because the odds are stacked against you. But through a combination of luck and hard work, we actually have a chance of doing it." Minor may look like he just put down a polo mallet, but he has the scrappy tenacity -- even obstinacy -- of an up-from-the-streets entrepreneur. "He has a lot of strong opinions," says one CNET staffer. "But he doesn't impose them." Colleagues describe Minor as "bright" and "intense," driven by an almost messianic zeal to build CNET's "red ball" logo into a global icon, not just a desktop one. Minor visibly bristles when he hears criticism that CNET sites such as Shareware.com are parasitic, feeding off of other people's content rather than generating original material. "If you look at our properties, they're actually all very original," says Minor. "Our Shareware.com isn't parasitic, it's providing a service. If you look at PC Magazine, they always have 'The 1,000 Top Shareware Titles On the Web.' I built a shareware search engine, because that's the better form for the Web. It had nothing to do with being parasitic. Jeez, our left-hand tool bar metaphor is probably the most stolen thing on the Web today. Everyone's ripped that off." The rap on Minor's company is that so far, it's been much better at launching new properties than managing existing ones. Over a two-year period, CNET launched 12 startup properties and three television shows. Some startups were more expensive and time-consuming than CNET anticipated. And with last fall's launch of Snap Online, a Web search and content aggregation service, CNET is poaching on the territory of the industry's 800-pound gorillas, all scrambling to become the "start page" of users crawling onto the Web. The CNET launch-o-rama has cooled Wall Street's ardor for the company over the past year. CNET's stock, which traded as high as 46-1/2 last September, fell to the mid-20s. It's bounced back of late, currently trading above 35. "They're going in a lot of directions at once," says Jill Frankle, a senior analyst at International Data Corporation. "They're still losing money, and the growth isn't as managed as it could be." But Minor makes no apologies for CNET being out to launch for the past few years. "You only get one chance at the beginning of an industry," says Minor. "If you miss the window and you don't invest early, then you wind up spending an enormous amount of money later on. For the first time since starting the company, I feel settled. It's not like we've won the war, but I don't wake up thinking we've got to launch something."
Many companies are a reflection of their founder's interests; CNET is more a reflection of its founder's obsessions. "I nearly lost a girlfriend in college because I used to spend Saturday and Sunday nights on the couch reading all the computer magazines," says Halsey Minor. "I bought them all and would just sit there reading them all weekend. My entire life I've been fixated about computers." For the geek subculture, computer magazines -- and now computer-related Web sites -- serve roughly the same function that pornography does for the general population. The Communications Decency Act is looking in all the wrong places -- computer Web sites such as the ones run by CNET are the real Internet porn. Like the skin rags, computer magazines and sites fixate their readers' attentions on "hardware" and "performance" ("Web Servers: Faster! Faster!"), keeping the unattainable object of desire seemingly just within reach. They revel in festishistic detail about the Plaything of the Month, often in vaguely auto-erotic terms ("Put a Gig In Your Pocket: Zip, Jaz, and More!"). Many of the photos, revealing the intimate inner workings of sleek-bodied hardware, are nothing less than high-tech beaver shots. Spend a Friday or Saturday night clicking through the various computer-related Web sites, and by evening's end, the domain is revealed for what it actually is: a 28.8 bps circle jerk. Real sex is superfluous when you're staring at a honey of a laser printer spitting out flawless pages or peeking at a preview of "Quake II" with your sweaty hand riding the joystick. So it makes perfect sense that CNET's Snap Online has banned sex from its service. "The rule we have with Snap is 'No pornography, no firearms, no tobacco,'" says Minor, articulating a rule that some might view as downright un-American. "Yahoo and Excite make about $1 million a month on pornography. One of the main differences between us and other services is that we've taken a much more family-oriented approach. With Snap, you don't have to worry about typing in 'Little Women' for your daughter and getting a pornographic ad." Minor says the porn ban on Snap is an economic decision, not a moral one, and envisages Snap becoming "what Blockbuster is to video stores." By that, Minor means, he wants Snap to be a reliably mainstream domain that's completely safe for family surfing. Blockbuster is certainly a successful operation, but to more than a few people it represents the darker side of American media monoliths. Blockbuster, like Disney, aggressively sanitizes content in the name of family values. It rejects independent and non-conformist videos in favor of mass-appeal blandness. Employing the skewed values of network TV, it bans nudity but glorifies violence. And it certainly doesn't lose any sleep over providing "great editorial" to its customers. You can walk into a Blockbuster and not turn up a single copy of "Citizen Kane," but you'll find an entire wall of "Die Hard II." Already, CNET displays some of the formulaic blandness that has made media giants like Blockbuster prosper. CNET's four cable TV shows are relentlessly chirpy, favoring a USA Today-style optimism in covering computers and technology. "Up next -- keeping your heart beating strong ... with the help of the Net!" gushes a typical tease from "The Web," an hour-long magazine show that seems much longer. Watching CNET's TV programs, it's hard to find a single instance in which computers aren't making everyone's life longer and more satisfying than ever. Even if you already own a perfectly adequate computer, CNET's TV shows put you in the mood to buy a better one. Fortunately, incessant reminders from the anchors to "check out CNET's Web site" make it easy to do just that. As a tool to drive computer sales, CNET TV may end up being a winner. But for a consumer trying to decide whether to make a computer purchase at all, CNET is about as trustworthy as the Soviet Union's Tass news service used to be. CNET pours its heart and silicon soul into telling consumers what computer gear to buy and how to do it, but completely sidesteps the question of "why" someone should buy, or -- gasp -- whether they should buy at all. Getting consumers and corporate buyers to buy more stuff, after all, is CNET's "larger mission." CNET's television shows already follow the Blockbuster line on sex -- nudity is unthinkable, but a little tease is good for the soul. The co-host of "The Web," Sofie Formica, is a fetching Australian who starred in soap operas Down Under and on the tabloid newsmagazine "Extra," where, presumably, good editorial wasn't a primary mission, either. On her personal Web page, Formica reveals that "I've always liked boys" and posts a series of pouting photos showing "Me in my many moods." Move over, Lesley Stahl. Formica's soft-core come-hitherings would be welcome on Snap, but an online gay and lesbian bookstore might not make the cut if the site is explicit enough to be deemed pornographic. Snap doesn't care if the Net libertarians squawk. It's targeting the 85 percent of the population that isn't online, for the same reason that Willie Sutton robbed banks -- 'cause that's where the money is. "The Internet can be a confusing place," announces the Snap starter kit. Snap promises to be "the friendliest way to understand, get on, and use the Internet." And even though Snap's promotional tag-line is "It's all there," you'll never have to worry about breasts flashing across the screen. Snap might be an overnight success if half a dozen other major players weren't also doing versions of the same thing. These days, everyone wants to be the "front door" or "portal" to the Web, the first page that Internet viewers see. Information aggregators such as Yahoo, Excite, Lycos and Microsoft (which in the fall plans to launch a new gateway page, code-named Start) are betting that if they can be that first page, users -- particularly new ones -- will tend to stay within one large site, the way many TV viewers stay with NBC after watching "Seinfeld," no matter how lame the follow-up show is. "You're at a tremendous advantage when you're the first thing people see because after that, people have to type something in," says Minor. "If you don't deliver a good service, they won't stay. But if you do, you've won." What's likely to happen over the next several years is that the Web aggregation business will come to resemble network television -- three or four large players will survive, and the rest will either go away or recast themselves as niche sites. Some question whether CNET can make Snap one of those handful of survivors while still keeping all of its other plates spinning. "It's going to be a challenge for Snap to survive if it's not [CNET's] fully dedicated business," says Yahoo COO Jeff Mallet. "You can't just dabble in this space." But the man who once dreamed up the name Global Publishing Corporation is still thinking big. "Snap is a long-term proposition," Minor says. "If the Internet really is the medium for the next 100 years, then we have time." CNET's investors, however, may not be so patient. In many ways, Snap is Halsey Minor's biggest challenge. It's the first time his company has targeted an audience whose interests don't closely resemble his own. Minor has built a small empire by delivering high-quality services to technical folks -- he's been a trade publisher for an exploding trade. But CNET may find it harder to attract people who have better things to do with their Saturday nights than download "7 Surfing Secrets You Need to Know." And sales pitch-weary consumers may come to call "good editorial supporting a larger mission" by another name -- advertising -- and turn it off.
Tom McNichol is a San Francisco writer whose work has appeared in the New York Times Magazine, the Washington Post, Spy, Punch and other publications. |
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