INTERVIEW-Motorola sees huge growth in broadband
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CHICAGO, Jan 5 (Reuters) - The technology that Motorola
Inc. MOT.N acquired on Wednesday with its purchase of General
Instrument Corp. GIC.N could soon transform televisions into
computers, telephones and even video stores.
Schaumburg, Ill.-based Motorola, which completed its $11
billion acquisition of set-top box maker General Instrument
Wednesday, said it formed a new broadband communications sector
that will use the boxes for services such as high-speed
Internet access, video and telecommunications.
The boxes sit atop television sets and are used to receive
digital data from cable operators, which allows for high-speed
digital services.
"What you can do with this (technology) is a combination of
all forms of video and interactive video, including true
video-on-demand, where you can order off of a menu any movie
you want to watch via a remote control," Edward Breen, former
chairman of General Instrument and newly named president of
Motorola's broadband unit, said in a telephone interview.
With a high-speed cable modem, "you can now (use) your TV
to access the Internet without going to the personal computer,"
Breen said. "You can do split-screen or picture-and-picture"
with television on one side and the Internet on the other.
As early as 2001, the set-top boxes could be used for
Internet-based telephone calls, Breen said.
Breen said Motorola's global presence would accelerate
international growth prospects for the set-top boxes. He said
General Instrument generated only 11 percent of its 1999
earnings overseas, yet the international television market was
10 times larger than the U.S.
"The biggest part of the growth is international," he said.
"We're well positioned in the U.S., but the sheer opportunity
outside the U.S. is going to be very significant for us over
the next five years."
For Motorola, the acquisition should have no effect on
earnings in 2000, but boost profits in 2001. When the
acquisition was first announced in September, Motorola said the
deal would slightly hurt earnings, but later amended that
forecast.
In the interview, Motorola Chairman Christopher Galvin
declined to comment on the company's 2000 earnings outlook,
saying it would provide an updated forecast when it releases
its fourth-quarter earnings in about two weeks.
Shares in Motorola were off 2-9/16 at 135-5/8 in afternoon
New York Stock Exchange, off the session low of 130-3/4.
REUTERS
Rtr 15:45 01-05-00
IATV's technology is the one that will facilitate the split screen with television on one side and the internet on the other. Look for MOT to begin a worldwide effort. Remember that IATV's software will be included in every box. With the PC business slowing down (GTW warning), investors are going to be looking for the next hot sector and IATV will be a leader in the convergence area. IF you have more questions feel free to come over to the IATV thread - there are a lot of knowledgeable posters there. |
