Alcatel and Oracle to form interactive TV venture
LONDON, Oct 24 (Reuters) - French telecom equipment maker Alcatel (SBF:CGEP) and U.S. software company Oracle (NASDAQ:ORCL) said on Tuesday they would set up a company that will offer interactive television to telephone operators.
The joint venture called Thirdspace will offer television programming as well as technology that has been developed by both companies. It will receive funding of 100 million pounds.
The interactive television will be offered over ordinary copper telephone wires, boosted by Digital Subscriber Line (DSL) technology which allows faster data transport.
Many telephone operators in Europe and the U.S. are currently selling DSL-upgrades to their telephone subscribers.
Thirdspace will offer broadcast television and movies on demand. It will buy the programmes from broadcasters, production companies and film companies.
Oracle's aim is to make Internet more appealing to consumers so that they are willing to buy more via the web. When Internet traffic grows, demand will increase for Oracle's databases which store information that is used on the Internet. The company also sells software that enables e-commerce on the web.
Interactive television is in its infancy, and generally offered via cable television wires. Internet and cable companies in Europe, such as UPC (AMS:UPEC) and LibertySurf (SBF:LBYP) are geared up to offer interactive television through digital cable set-top boxes before the end of this year.
By offering the same interactive services over telephone wires, telecom operators will try to retain customers.
"The name of their game is to keep their customers," said Chief Executive of Thirdspace, Brian Keating. "If they're not going to do something, they're going to lose those customers."
He said his joint venture is in talks with four of the biggest telecom companies in the world to start offering interactive television as soon as early next year.
Using DSL-technology from Alcatel, which recently bought Canada's Newbridge Networks which has technology to enhance DSL, the new company should be able to offer video streams with a quality equal to digital versatile disk (dvd), Keating said.
This razor sharp picture quality should be achievable even with the relatively slow DSL bandwidth specifications that operators use in most countries. 8825, fax +44 20 7542 3722, email: lucas.grinsven@reuters.com))
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