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Sun Microsystems gave server-based Java development a boost earlier week by releasing a new version of its J2EE spec.

Java 2 Enterprise Edition 1.3, which will support the development of more complex business applications, includes a new reference implementation, available in binary form, as well as a test kit that is the basis for Sun's J2EE Compatibility Test Suite. Tool and application server vendors must be certified as J2EE-compliant.
Although many e-businesses have started to build and run J2EE-based applications in the past year, the new spec will support more sophisticated apps, said Giga Information Group analyst Randy Heffner.
J2EE 1.3 includes new prebuilt connectors for integrating Java app servers with popular ERP and customer service and sales management platforms. It also adds support for so-called message-driven beans, which brings a component model to inter-application messaging--key to building transaction-processing apps. It also supports Enterprise Java Beans 2.0, which includes new container-managed persistence that simplifies the development of distributed apps. And finally, it offers improved support for XML integration, Java Server Pages and Servlets.

In a related move this week, Microsoft said it plans to add Java Database Connectivity drivers and support for them to its SQL Server 2000 database.

News source: Yahoo!/Techweb

That's a risky wager, analysts say.

"I am very skeptical about Napster's long-term revenue potential," said Jupiter Research analyst Aram Sinnreich. "They've got one shot to launch a new service that looks nothing like the old one...If they don't get it right, Napster will be dead in the water."

Napster and Bertelsmann declined to comment on the funding.

Like its major media peers, Bertelsmann is in the midst of a scramble to make sure that it establishes as much control over the digital future of its content as it now has in the physical realm. As one of the biggest publishing distributors in the world, its range of content assets is slightly different than rivals such as Vivendi Universal or AOL Time Warner, but its aims are roughly similar.

Unlike AOL Time Warner, Bertelsmann lacks a potent online distribution arm. The company hopes that a revived Napster service, which will charge people to swap or download music files, will fill that missing piece of its Internet strategy. The service potentially could let consumers trade other types of digital content beyond music files, such as books, music videos or movies.

Although Napster remains a shell of its former self, Bertelsmann executives think the service still has cachet among Net users. The hard part will be convincing them to return with their wallets.

Napster's revenue potential is cloudy even under the best circumstances, given that its brand name has been built on music-swapping services that don't cost a dime.

The company hasn't yet said how much it will charge for its monthly service or what features it will include. Previously, executives have laid out a vision of tiered services, with an entry-level fee of about $4.95 a month and an advanced service offering unlimited downloads for $7.95 to $9.95 a month.

But the landscape has changed somewhat since that time. Napster has cut a considerable number of deals with prominent independent labels in Europe and the United States and appears likely to offer the largest authorised array of popular independent artists of any of the planned subscription services.

Its grasp on major label music is more tenuous, however. It has a tentative deal with MusicNet, which includes Warner Music Group, BMG Entertainment and EMI Recorded Music, to offer those labels' songs once it proves it no longer allows copyright violations. The MusicNet content is expected to be part of a separate tier, with a fee over and above what Napster charges for basic service.

The cost structure for Napster's service is beginning to mount as well. As a part of the deal announced Monday, Napster agreed to pay music publishers a third of whatever it pays for content licenses. The company has not said how much money this is likely to be or what percentage of its overall revenues this might represent.

Analysts say this agreement could make negotiating with record labels, which continue to pursue their lawsuit against Napster, more difficult. Labels have traditionally taken well over two-thirds of the total revenue dedicated to content licenses.

The cost of all of these licensing fees is likely to leave room for only a small margin of profit, analysts say.

Napster Chief Executive Konrad Hilbers said Monday that profits were part of the business plan, however.

"I don't envision any Internet business (settling for) less than a 20 percent margin over the long run," he told reporters. "There's nobody here who's willing to lose money over the long run."