Please feel free to forward this newsletter to as many friends as possible. I have a personal goal of reaching one million readers. I can achieve it with your help.

  the Software View: You and iOwn.com.

Welcome back, gentle readers. For those of you with Web access and a Netscape Navigator browser, please click here:
http://www.softwareview.com/
Scroll down the page and you will notice a link entitled, "Daily view weblog". The daily news page is also known as a "web log". It is en vogue and the fashion of these days to call it that. Click on the link, click "reload" on your browser or clear your browser cache to ensure that you always receive the freshest, hottest daily news concerning Java^TM, Linux®, XML, wireless, and the software industry! The link never changes, but I will be updating the HTML file page behind it every day. Please, do take a gander at it every day.

Also, gentle readers, the Software View is an Associate Internet World Wide Web site of Amazon.com. I'd like to extend my sincere, heartfelt gratitude and thanks for your patronage. I'm offering links to books, et cetera that you can purchase from my web site. I'd greatly appreciate it if you would purchase software industry books from my web site. Help support my newsletter and web site by purchasing items from Amazon.com from my web site. Here is the URL (Uniform Resource Locator):
Click here

Now, dear readers, on with this week's episode of the Software View!

MORTGAGING THE FUTURE

Megan Barnett writes, "An estimated $4.2 billion worth of online home mortgages was transacted during the year of 1998. Deutsche Bank research analyst James Marks predicts that $60 billion in loans will originate online in the year 2000. A quarter of all United States residential mortgages will originate online by the year 2003. Expect a fierce battle for market share. Internet entrepreneurs forced dramatic changes in the brokerage, book selling, and auction industries. Now they have their eyes on another huge segment of the financial landscape: home mortgages.

People hate shopping for mortgages. Getting the best rates requires multiple phone calls to banks, finance companies and mortgage brokers. You tell your story repeatedly, answer standard questions over and over, weigh countless options and ultimately decide on a lender. And that's just the beginning. You still have to endure one of the most paper-intensive and tedious of all financial transactions. The lender asks for piles of old financial records. You FedEx signed documents back and forth and spend hours on the phone with your mortgage processor. It is an old-world, offline horror.

iOwn.com started thinking about how to improve the painful process several years ago. Why not let the Internet automate some of the work, they wondered, freeing up time and reducing the costs of shopping and processing loans? By one estimate, the Web's share of the $1.5 trillion home mortgage market will grow from less than one percent in 1998 to twenty-five percent by the year 2003.

The online mortgage industry is divided into two camps. One group uses a referral model, while the other processes loans internally. iOwn.com (formerly HomeShark.com) does its own processing. Processors like iOwn.com employ small armies of customer-service representatives who handle the paperwork and correspondence needed to close a loan.

Whether the industry has room for both camps is an unanswered question. If you're a marketplace, it's almost like you're too neutral. With that model, you have to keep banks and consumers happy. In fact, all you really have to do is keep consumers happy. iOwn.com could be described as a "consumer advocate" rather than a marketplace.

The fact that most major mortgage lenders are partnering with the online sites can't make it easy for the referral model. For instance, Chase Manhattan Bank provides rates for iOwn.com and a number of other online home mortgage Internet sites. While the same rate could be returned from Chase on each site, some of those sites will send you elsewhere to have your loan processed. iOwn.com will process it for you directly.

During the past six months online mortgage providers have begun to climb the crest of the online wave, while interest rates have declined steadily. Falling rates prompt just about every mortgage holder to at least consider whether to trade up or refinance. These sites have made it easy to window-shop for loans – and a portion of those window-shoppers turn into buyers.

iOwn.com's distribution partners include Lycos, Infoseek, and HotBot. During November of 1998, iOwn.com closed $50 million in online home mortgage loans.

NORTH, SOUTH, EAST, WEST POINT

Ned Hoyt was the Class valedictorian and was chosen to serve on the Brigade staff for his Class of the United States Military Academy at West Point, New York. He graduated during the summer of 1990 with a Bachelor's of Science degree in Economics. Because of his undergraduate achievements, he got the opportunity to study at Queen's College at Oxford University in the United Kingdom. He graduated with an M.B.A. in Politics and Economics during the year of 1992. From 1992 to 1994, he served as a Light Infantry platoon leader in the United States Army. When he got out of the military, from 1994 to 1996, he served as an Engagement Manager for the McKinsey and Company consulting company. Then he founded and became the President and Chief Executive Officer of iOwn.com.

WHAT'S IN A NAME?

Jacob Ward writes, "Naming a company seems like it should be easy: Get some friends together and brainstorm yourself a brand. But most companies end up paying a consultant tens of thousands of dollars to conduct consumer recall studies, pull teeth at the United States Patent and Trademark Office to register the name as a trademark and (an added hassle particular to Web companies) hunt through InterNIC for an available URL.

Even then, sometimes the company wants to start over. Each week, it seems, another Internet company changes its name, sacrificing millions of dollars in branding to be called something else. The Mining Company renamed itself About.com. Jutvision changed its name to Bamboo.com. Computer literacy renamed itself FatBrain.com. AllApartments changed its name to SpringStreet.

Darrell Hayden, president of a company which charges between $15,000 and $20,000 to find a suitable name and corresponding URL, says that his Internet clients often don't realize that it takes more than a domain name. "I've been in meetings with clients where they check InterNIC and pick one – 'Alpha.com looks available!'" says Hayden. "And we have to tell them that it's not necessarily available in the real world. And they say, 'Oh yeah, right.'"

Barbara Heinrich, Vice President of marketing at iOwn.com, which changed its name from HomeShark.com ("We found the name had different connotations for different people," she explains), says finding a name was surprisingly difficult. Using Lexicon Branding, a brand-development company, she says, "We cut it down from 3,000 names to eighty-five. After figuring out what's a clean trademark and what URL you can get – only then can you do the focus group."

The URL alone can cost $10,000 or more if it's owned by a greedy prospector; hiring an attorney to check out your Top ten list can run $1,000 per name. To keep it cheap, About.com created a fake company name to do the domain-name acquisitions. "If we, as a public company with $80 million in the bank, want to buy a name, the price is going to be ridiculous," said Scott Kurnit, chairman and Chief Executive Officer of About.com.

The company name is the first line of defense against the competition. But right now, the fashion in Web-related names runs contrary to legal wisdom. In the real world, trademark and patent lawyers advise their clients to establish a wide defensive perimeter around their names by choosing ones that are (in legal terms) descriptive, suggestive and, most important, fanciful. A fanciful name differentiates a brand from its competitors. Clorox, Kodak and Xerox (XRX), for example, are powerful brand names with no prior associations in a consumer's mind.

The intoxicating "first-mover" temptations of the Internet, however, have driven many people to choose plainly descriptive category names – often before a company has even been assembled. "We bought the URL before we had the business plan, to be quite honest," said Tracy Randall, Vice President of e-commerce at Cooking.com.

But to be memorable, a name shouldn't be generic. "Someone with an abstract name, provided it's loaded with positive, mysterious, exotic images, has a more efficient engine for building brand," says J. David Placek, Chief Executive Officer of Lexicon, which charges Internet startups $40,000 to $50,000 to find a name and a URL. Already, some Internet companies are discovering the problems of not having established that defensive perimeter.

SHARK BITE

Barnett writes, "HomeShark.com changed its name to iOwn.com to court a new image. Homebuyers will no longer make the mistake of assuming HomeShark is an online marketplace for loan sharks. The four-years-old San Francisco, California-based online provider of home buying services, including real-estate listings and mortgages, changed its name to iOwn.com.

Last year, the company rolled out three regional ad campaigns in an effort to establish its new brand identity. Over the course of the next three months, the firm's Web site was completely redesigned with new product enhancements. iOwn.com launched a national ad campaign later that summer.

Chief Executive Officer and founder Ned Hoyt explained that the name iOwn.com gives the consumer a sense of empowerment at the same time it places the company in a better strategic position. "Now I own my own home," Hoyt said that he hopes consumers will proudly declare after their experiences with iOwn.com. And from a strategic perspective, the name iOwn.com could open the doors for lending for more than homes. But for now, Hoyt said, the company's focus will remain on the homebuying experience.

Hoyt's company closed one thousand loans, worth nearly $170 million, during the first quarter of 1999. The company is experiencing a healthy growth rate. Instead of referring customers to loan providers as some of its competitors do, iOwn.com employs a small army of in-house processors to handle the loans from beginning until close; sixty percent of the 250 employees at iOwn.com work in customer service. The army is growing at such a fast pace that the company purchased a 40,000-square-foot facility, with a maximum capacity of four hundred people, in Martinez, California. In the past, iOwn.com has retained the services of the Antenna Group Public Relations firm, based in San Francisco, California. During November of 1998, iOwn.com named Blodwen Tarter Vice President of product management. Tarter's a veteran of Schwab online, Knight-Ridder Information and Providian Financial (PVN).

Sincerely,
Mark Kuharich

Join my free e-mail newsletter called the Software View by clicking here or by sending an e-mail to thesoftwareview-owner@west-point.org