NetMarket
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NetMarket is an
online marketplace An online marketplace (or online e-commerce marketplace) is a type of e-commerce website where product or service information is provided by multiple third parties. Online marketplaces are the primary type of multichannel ecommerce and can be a way ...
owned by
Trilegiant CXLoyalty (formerly Affinion Group and CUC) is a private company based in Stamford, Connecticut that provides customer engagement and loyalty programs. Affinion designs, markets, and services programs that deal with customer relationships for ...
that sells various goods ranging from electronics to jewelry. It was founded in 1994 by Dan Kohn and Roger Lee, both former
London School of Economics , mottoeng = To understand the causes of things , established = , type = Public research university , endowment = £240.8 million (2021) , budget = £391.1 millio ...
students, and by Guy H. T. Haskin and Eiji Hirai from
Swarthmore College Swarthmore College ( , ) is a Private college, private Liberal arts colleges in the United States, liberal arts college in Swarthmore, Pennsylvania. Founded in 1864, with its first classes held in 1869, Swarthmore is one of the earliest coeduca ...
. ''
The New York Times ''The New York Times'' (''the Times'', ''NYT'', or the Gray Lady) is a daily newspaper based in New York City with a worldwide readership reported in 2020 to comprise a declining 840,000 paid print subscribers, and a growing 6 million paid ...
'' has credited the company with performing the first secure retail transaction on the Internet.


History

NetMarket was initially conceived by Dan Kohn while he was studying at the London School of Economics after finishing an honors degree in economics from Swarthmore College. He recruited classmate and Yale graduate Roger Lee to become president of the company. The company's management team was rounded out by Guy H. T. Haskin and Eiji Hirai, both from Swarthmore and both hired for their technical skills. The firm's initial headquarters was a house in
Nashua, New Hampshire Nashua is a city in southern New Hampshire, United States. At the 2020 United States census, 2020 census, it had a population of 91,322, the second-largest in northern New England after nearby Manchester, New Hampshire, Manchester. Along with Manc ...
. It started out selling goods such as CDs and books for various offline stores using non-digital payments. On August 11, 1994, NetMarket sold ''
Ten Summoner's Tales ''Ten Summoner's Tales'' is the fourth solo studio album by English rock musician Sting. The title is a combined pun of his family name, Sumner, and a character in Geoffrey Chaucer's '' The Canterbury Tales'', the summoner. Released in 1993, ...
'', a CD by
Sting Sting may refer to: * Stinger or sting, a structure of an animal to inject venom, or the injury produced by a stinger * Irritating hairs or prickles of a stinging plant, or the plant itself Fictional characters and entities * Sting (Middle-eart ...
, to Phil Brandenberger of Philadelphia using a credit card over the Internet. ''The'' ''New York Times'' characterized this as "...apparently the first retail transaction on the Internet using a readily available version of powerful data encryption software designed to guarantee privacy." The encryption used in the transaction was provided by the Pretty Good Privacy (PGP) program, incorporated into the X Mosaic browser. The author of PGP,
Phil Zimmermann Philip R. Zimmermann (born 1954) is an American computer scientist and Cryptography, cryptographer. He is the creator of Pretty Good Privacy (PGP), the most widely used email encryption software in the world. He is also known for his work in VoI ...
, called the transaction an important step towards the creation of digital cash. NetMarket was soon purchased by
CUC International CUC (Comp-U-Card) International Inc. was a membership-based consumer services conglomerate with travel, shopping, auto, dining, home improvement and financial services offered to more than 60 million customers worldwide based in Stamford, Connectic ...
and despite expectations to the contrary, continued to be successful. While general online malls were superseded by specialty shops and forced to close, NetMarket continued to expand the range of its inventory. In 1997 the chairman of CUC estimated the company could fill approximately 20% of a family's retail needs with that number going up to 95% in three years. The company was also profitable, estimating doing more than $1 billion in sales in 1998. ''
The Economist ''The Economist'' is a British weekly newspaper printed in demitab format and published digitally. It focuses on current affairs, international business, politics, technology, and culture. Based in London, the newspaper is owned by The Econo ...
'' called NetMarket's business model the third wave of online retailing - one site providing goods found in an entire mall, but focused on the efficiency and low prices provided by specialized retailers. Also in 1997, CUC paid
America Online AOL (stylized as Aol., formerly a company known as AOL Inc. and originally known as America Online) is an American web portal and online service provider based in New York City. It is a brand marketed by the current incarnation of Yahoo! Inc. ...
$50 million to set up and promote NetMarket's services on AOL's Shopping Channel. In 1999, NetMarket, now owned by
Cendant Cendant Corporation was an American provider of business and consumer services, primarily within the real estate and travel industries. In 2005 and 2006, it broke up and spun off or sold its constituent businesses. Although it was based in New Yo ...
, had its ordering system breached due to a bug in its software. Customer names, addresses, and phone numbers could have been shown publicly along with order details for as many as 983,000 orders stretching back to June 1998. NetMarket was spun off by Cendant in 2001 under a new parent company, Trilegiant.


References

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External links


Official website
Online marketplaces of the United States Internet properties established in 1994 1994 establishments in the United States