In its first phase, NetObjects was based in Redwood City, California, and ceased operations in 2001 after selling its assets to Website Pros (now Web.com) and a portfolio of patents to Macromedia.

CNET's Builder.com elected Samir Arora one of the Web Innovators of 1997,[6] and in 1998 NetObjects received the prestigious Gold award from the Industrial Designers Society of America (IDSA).

In 1999 IBM brought NetObjects to the stock exchange with initial public offering while remaining the major shareholder.

In the following years numerous product-bundling deals[14] were made with nearly all the big PC sellers like Dell and HP,[15] and with Internet service providers like UUNET, Earthlink or 1 & 1 (Germany).

[citation needed] In 2000 the stock price of NETO (ticker symbol) reached its record high of $45 11/16 USD, making NetObjects worth $1.5 billion.

[20] In the beginnings of the concept of "software as a service" (SaaS), the company secondly made a bet on its ability to recognize technological trends[21] and coined a strategy shift to a subscription model.

[28] Tough competition from Microsoft, Macromedia and Adobe put pressure on market share and falling prices of web-design applications affected revenues.

Technical demands for large business web sites changed and required direct access of programmers to HTML code — which NetObjects Fusion was not designed for.

[30] Its target market were designers who need complete control over page layout and a similar user interface as desktop publishing applications.

In 2001 revenue decreased sharply,[31] a result of changing markets, price cuts, strategy shift to Software as a Service.

A smaller part of the amount was transferred instantly, while $3.0 million remained payable from future revenue of NetObjects Fusion sales until 2013.