The Well - the good ol' days....

[Steve]

The Well Shrinks as Its Children Grow

Matt Richtel
NY Times 7/25/98


The Well, the pioneering online community of intellectuals and
writers that helped define the concept of the virtual village, faces
declining membership at a time when many of the electronic forums
that it inspired are booming. 

But Well officials and members say their small corner of cyberspace
is as resilient as ever, having survived many predictions of its
imminent demise over the years. 

"It's far too soon to be writing any obits," said Bruce Koball, a
long-time Well member. "All the ones that have been written in the
past are untrue." 

Founded in March 1985, long before there was a Web, the Well is
known as a place for discussion among contentious, impassioned and
sometimes self-important digerati. Its Sausalito, Calif., location
gives it a distinct San Francisco Bay Area flavor. 

It's likely that most of the millions of people who now populate
cyberspace have not heard of the Well, but they have been touched by
its legacy. Because of the intense sense of community generated by
its discussion groups, the Well has been a model for other companies
hoping to create online gathering places. Its imitators include
Geocities, the Globe and the mighty America Online. 

Those communities are growing exponentially, while the Well may be
stagnating at best. It now has 7,500 members, down from a peak of
10,000 a year ago, company officials said. An undisclosed number of
its accounts are provided free of charge. 

Published reports have said the Well loses 400 members a month, but
the company disputes that number. Officials declined to specify how
membership levels are changing. "We're not big into statistics,"
said Claudia Stroud, a director of the Well. 

Meanwhile, the company's president, Maria Wilhelm, and its director
of marketing quit earlier this year, leaving the Well with a staff
of six. The situation has prompted some Well members to question the
long-term viability of the operation. 

Critics say the Well failed to capitalize on its early lead in the
online business because it did not invest in marketing the service
or upgrading it to incorporate new technologies. They also charge
that the Well lacked a clear business direction. Now it may be too
late for the Well to take advantage of the cachet surrounding its
name and grow into a viable business entity. 

Company officials said they have not neglected the Well's discussion
groups, but they did acknowledge that they have been more focused on
other parts of the business, namely an Internet access service and
software development components. 

"Now we're really turning our attention back," Stroud said, noting
that the company is exploring various business possibilities. "There
are a lot of different logical extensions to the Well brand," she
said. "but I wouldn't want to speculate as to what they might be."
Stroud did confirm that Bruce Katz, the company's owner, has said he
will consider selling it. 

The Well charges $10 a month for access to its discussions through
its Web site. For $15, it sells a package that includes an e-mail
address and the ability to create a private discussion, among other
perks. 

Many Web sites charge nothing for access to discussion groups and
chats. But Well members say that the exclusivity, the small scale
and the sense of community on the service lead to better discussions.
There is a sense on the Well's 50,000 discussion groups, many of
which are not currently active, that it is not a place for the kind
of unchecked, mindless insults characteristic of some other online
forums. 

When Stewart Brand created the Well, his idea was to invent a forum
for high-level electronic dialogue. He believed passionately in free
speech, but also in the proviso that people had to take
responsibility for what they posted -- thus his motto, "You own your
own words." 

Another lasting contribution Brand made was to give free accounts to
some writers, intellectuals and journalists. As a result, word of
the Well and its influential membership spread far beyond its
immediate circles -- perhaps giving it a buzz that was not in
proportion to its size. 

The Well has never been a particularly lucrative business, and
profits have been sporadic and small. There were constant equipment
and technology problems, and there was never enough funding for the
Well to keep pace.

Katz, the man who built and sold the Rockport shoe empire and had
been a Well member since 1989, bought half of the Well for $175,000
in 1991. In January 1994, he purchased the other half for $750,000.
He also began investing in infrastructure and new offices; Well
membership had grown to 8,000. Some credit him with saving the
company. 

In 1996, Katz hired Wilhelm as president. Under her direction, the
Well split into three parts; the Well conferences; a software
company called Well Engaged that markets the discussion software used
on the service; and Whole Earth Networks Inc., an Internet Service
provider.

Well Engaged continues to grow, said Stroud, noting that among the
40 companies that license its conferencing software are The Wall
Street Journal Interactive, The Los Angeles Times and Netscape.
Meanwhile, Katz this year sold Whole Earth Networks for $9 million to
GTS Telecomm. 

Stroud said the Well itself is "profitable," but she declined to
elaborate. Others who are familiar with company operations said
that, if there is a profit, it is small. 

"The Well is vibrant, the loyal conference participants are still
there and the company is profitable at a time when few other
Internet companies are," Stroud said. 

Stacy Horn, founder of the New York-based online community Echo,
said she empathizes with the Well's circumstances. The membership of
Echo, which was patterned after the Well and is often cited as its
East Coast equivalent, has been flat for the last year at about
3,500. Horn blamed the lack of growth on the fact that Echo has not
yet implemented a Web-based discussion system, and is only accessible
through an antiquated text-based interface. 

Horn believes the Well has suffered because it has not fully
integrated new technology into the Well discussion software. For
example, Horn said, it does not yet offer instant messaging that
allows members to communicate in pairs as well as in larger
discussion groups. 

"Both the Well and I have to do something," Horn said. "If we do
nothing, we may die." 

She added, however, that Echo and the Well offer a level of
interaction and discourse not seen elsewhere on the Internet. It is
an intellectual asset that Well fans frequently cite: they say that
as long as people want thoughtful conversation online, the Well will
have a place. Perhaps, they suggest, this is not a place for the
masses anyway. 

Ironically, as turbulent as its business operations have been, the
community inside the Well has had a notably stable year, said several
long-time Well members. Fred Heutte, a Well member since 1987, said
conversations remain energetic and informed, and the community is
intact despite the business machinations. 

At the same time, the members do not dispute that the forum can be
unkind to the Well's leadership, skeptical about the company's
direction and ever-wary of the future. In short, it's their party and
they can whine if they want to. 

"It's the Well. There's always somebody complaining," said Noah
Johnson, a Well member and the son of the company's founder. "We're a
crabby bunch of smart people." 

Copyright 1998 The New York Times Company




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