A secure new space where teams can collaborate

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The designer of the Lotus Notes program, Ray Ozzie, has developed a software tool to provide new ways for workers to collaborate over the Internet.

The software, simply called Groove, employs the same peer-to-peer approach to permit small groups of workers to share data, have voice conversations and create a shared “virtual space” without need of a large corporate network infrastructure.

In addition, it promises to increase the ease with which any two people can have private and secure conversations over the Internet.

Ozzie, 44, believes Groove will start a new generation of software with the potential to transform the use of personal computers as workplace tools.

One of the first consumer-oriented software programs to take advantage of the Clinton administration’s decision to drop national security restrictions on encryption technology, Ozzie’s program will permit any group of users to create a secure and private channel beyond the reach of government monitoring like the FBI’s Carnivore system.

In turning the product into a business, Ozzie will borrow from the business model of Real Networks, which gives away a simple version of its streaming-media software and sells a commercial version. Groove also foresees revenue from add-on software components, developer licenses, and a centralized server business that will help manage the flow of information.

Groove Networks, was created in 1997 with the backing of Mitchell D. Kapor, the founder of Lotus and now an independent investor.

Ozzie’s vision has managed to attract $60 million in capital for his company, which is based in Beverly, Mass., and has 150 employees. But it also has a formidable potential competitor: the Microsoft Corporation, which already includes a component known as NetMeeting with its Windows operating systems.

Currently, Groove’s advantage is that it provides a set of application programming interfaces intended to encourage developers to build programs based on Groove’s software and network infrastructure, thereby supplanting the role of the operating system.

That model is what attracted Jim Breyer, managing partner at Accel Partners, the venture firm in Palo Alto, Calif., that is Groove’s major investor. “We went into the deal realizing that it would take several years for Groove to get deep traction” among corporate users, he said.

But he also said he believed that the company would quickly find a market with companies like Wal-Mart, which is developing a Groove application to permit its customers to share digital photographs.

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