As the Internet becomes increasingly popular among computer users, Spyglass Inc. believes a massive untapped market is growing among the "Web-impaired" - those who do not own a computer.
While manufacturers are Web-enabling everything from TVs to telephones to gas pumps, Spyglass is hoping its own technologies and components will be at the core of these devices.
Tim Krauskopf, Spyglass co-founder and chief technology officer, said the biggest challenge facing his company and the entire connected devices industry will be overcoming the perception that the Web is a computer-based media.
"We are fighting the perception that this is what the Web is," said Krauskopf. "There are so many valuable uses of the Web beyond images and bandwidth-heavy files. Our goal is to make it possible for HTML and HTTP to be anywhere and everywhere."

Such ambitions could transform the business of Spyglass, which now gets most of its revenues from licensing its browser technologies to PC companies such as Microsoft Corp.
"What [Spyglass] is doing makes sense," said Jim Hurley, director of operating markets for the Aberdeen Group, a Boston research firm. "There are more opportunities and a more ubiquitous demand associated with connected devices... The likes of set-top boxes will be in huge demand."
Whether this gambit is going to pay off will depend on how aggressive are the 102 licensees Spyglass has recruited. A Spyglass spokesman said at least 15 of these licensees are incorporating its technologies in some 30 connected devices.
For example, Mitsubishi Consumer Electronics of America (MCEA) is using Spyglass technology in its DiamondWeb TV project which will allow consumers to access the Web via TV, using either a remote control or an optional keyboard for navigation. MCEA is integrating Spyglass browser technologies for the user interface, while employing Spyglass server technology for back-end support.
"It is very clear that to offer competitive TV products in the future they must be Web-enabled," said Jack Osborn, president and chief operating officer of Mitsubishi.

The use of Spyglass technologies could be far-reaching. One Spyglass licensee, whose identity the company would not disclose, is developing a Web-enabled gas pump that will display pre-selected Web pages across a screen to be viewed by the gas-pumping consumer.
"The Web is a pervasive media," said Jay Friedland, vice president of strategic marketing at Spyglass. "There's hundreds of devices that can access the Web."
In order to make that happen, Spyglass is investing heavily internally. For nine months ended June 30, the R&D budget at Spyglass rose 169 percent to $4.5 million from the year-earlier period. Now it accounts for 28.7 percent of its net revenues, up from 21.3 percent a year ago.
In addition, the company is counting on some of the technologies it acquired recently.
In April Spyglass acquired both OS Technologies, a developer of conferencing and forum technology, and SurfWatch, a developer of filtering and parental control software.
Spyglass believes WebNotes, a Web-based forums system from OS Technologies, will be a strong addition to their technology offerings in both the PC and connected devices arenas. "Offering corporations the ability to conference within an Intranet and Internet network is something our customers and prospects need in order to fully Web-enable their applications, services or devices," said Doug Colbeth, president and chief executive officer of Spyglass.
SurfWatch, on the other hand, will offer filtering technology that will be crucial in the Web TV market, said the company spokesman.
On the downside, analysts said the Web device approach could backfire because of the cyclical nature of its licensees.
Hubert Delany, research director of Internet strategy for Gartner Group, said, "Their market is similar to that of a tourist town. They make all of their money in one part of the year, which has to carry them through winter. The question isn't how much money is Spyglass making, the question is what will they do with it until the next wave hits.''

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