Compaq weighs options for AltaVista

Compaq weighs options for AltaVista

As Compaq acquires Digital, the computer giant will find itself with not only Digital's hardware technology but also with its Internet software technology, representing previously undiscovered territoryfor Compaq.

AltaVista, a division of Digital, will be acquired along with its parent and brings with it the company's Internet software and search engine technology. Of the two assets AltaVista brings to Compaq, the search engine poses the possibility of greater opportunities and greater costs, according to Ted Julian, a Forrester Research analyst.

Weighing options

"There are some things that are a fairly straightforward value-add for Compaq in terms of becoming a more valuable enterprise company," Julian said. "What could be a little trickier for it is the search engine. The impact is more difficult [to assess]."

Compaq has two options with the AltaVista search engine, according to Julian. The company can either keep it as Digital did using it as a pure search site for demonstrating new technology associated with its name -- or it can try to turn a profit with it through advertising and Internet commerce.

Either avenue means added cost for Compaq, however, either through marketing the AltaVista name to Compaq, or building the site to support advertising.

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