Liberate in deal with Insight over set-top services
By Jim Davis
Staff Writer, CNET News.com
January 13, 2000, 12:40 p.m. PT
Liberate Technologies increased its growing profile in the interactive TV market yet again today under a deal with
cable operator Insight Communications that will allow both companies to bring email and Web surfing capabilities to
a wider variety of set-top devices.
Liberate said today it acquired technology from Source Media and Insight Communications that will enable the company to bring
interactive TV applications to a greater number of set-top boxes. Liberate will exchange 886,000 of its stock for the technology,
which totals about $181 million, pre-split.
In addition, Insight will use Liberate's software to deploy interactive TV services. Insight is the eighth-largest cable operator in the
United States, with around one million customers. Also, Liberate will market Source Media's interactive program guide and local
content services to its customers.
"A lot of the activity in interactive TV has been around higher-end digital boxes," explained Liberate
CEO Mitchel Kertzman. While those devices such as General Instrument's DCT 5000 are
beginning to ship, the majority of digital set-tops can't support interactive TV applications that are
designed for those boxes, such as email and Web surfing.
With the Source Media technology, Liberate can now target the estimated 5 million digital
set-tops, such as GI's DCT 2000 and 1200 series, that fall into the less elegant product
categories, Kertzman said. The overall number of set-tops is expected to grow, he said, as the
use of two or even three digital set-tops of varying capabilities become more prevalent in homes.
By extending its reach to a larger number of devices, Liberate hopes to make its software a more
obvious choice for cable operators. Ideally, the cost of deploying the technology can be spread
over a larger number of customers, letting the cable operators realize revenues from new services
and eventually e-commerce activities sooner, according to the company.
Even where Microsoft's Window CE operating system and associated software is being used for
interactive TV, Liberate could gain a potential inroad through the Source Media technology.
AT&T's publicized plans for interactive services, for example, currently revolve around the DCT 5000. The DCT 5000 uses
Microsoft's Windows CE operating system. AT&T could conceivably offer a more limited range of interactive services--Web
surfing, for instance, would likely be precluded--using Liberate's software, in addition to a "premium" interactive TV service.
Liberate isn't the only company to have seen the wisdom of this strategy.
OpenTV, another provider of interactive TV software, is tuning its products for use on GI's low-end digital cable boxes, affording
OpenTV the same opportunity as Liberate. The only hitch for OpenTV is that, while they are a dominant supplier in Europe, they
don't have a deal with a U.S. cable company yet.
Meanwhile, Liberate has made moves to get its software into devices other than the traditional cable set-top boxes. Last week,
the company said it has started working with TiVo to provide interactive services alongside TiVo's digital video recording service.
With Liberate's software, TiVo-based boxes from Philips and Sony would theoretically be able to deliver Internet content along
with video-on-demand, an entertainment package similar to strategies currently being fleshed out by Microsoft and AOL.
Liberate's moves would seem to set the bar higher for any new entrants into the interactive TV space such as PowerTV. PowerTV
is the software subsidiary that Scientific-Atlanta is planning to spin off later this year, as first reported by CNET News.com.
PowerTV makes an operating system and associated applications that currently run on Scientific-Atlanta's cable set-tops. The
company has shipped out over 1 million copies of its operating system to date. |
