A Message to GI? MediaOne Taps Philips
By Alan Breznick and Jim Barthold
Breaking ranks with other major MSOs and sending shock waves through cable set-top manufacturers, MediaOne Group announced last week that it will buy digital set-top boxes from Philips Electronics NV of the Netherlands, as well as digital headends from DiviCom Inc. and computer software to support the equipment from Canal Plus.
The move by MediaOne, which it called the first order of non-proprietary equipment, access control systems and software complying with the cable industry's OpenCable standards, means that General Instrument Corp. and Scientific-Atlanta Inc. will finally no longer have a lock on the U.S. cable set-top market. Other large MSOs, including Tele-Communications Inc., Time Warner Inc., Comcast Corp. and Cox Communications Inc., have ordered their digital set-tops from GI and SA so far.
"It's certainly the boldest move yet by an MSO in the set-top space," said Michael Harris, president of Kinetic Strategies Inc., an industry analyst and consultant. "It's the first OpenCable play that intentionally does not endorse the S-A/GI duopoly."
Analysts predicted that the entry of Philips and MediaOne's selection of an open conditional access system, DVB (for digital video broadcasting), widely used overseas will clear the way for other major consumer electronics manufacturers to plunge into the domestic cable set-top business. That should mean greater competition, further innovation and lower set-top prices for cable operators as they try to turn boxes into a hot retail product.
"Ultimately, it's going to be Philips, Toshiba, Sharp, (Thomson, Hitachi) and on and on," said Cynthia Brumfield, principal analyst at Broadband Intelligence Inc. "Every consumer electronics manufacturer will be making digital boxes at some point."
Tossing a bone to GI, MediaOne said it has also expanded its digital-box relationship with the cable set-top leader. Under the broadened agreement, GI will supply digital headends, set-tops and software for one of the two undisclosed markets where Media One plans to launch digital service this year. The new team of Philips, DiviCom and Canal Plus will handle the other market.
Cont... cableworld.com
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