IS INSP A PARTNER IN DIGEO? (Part Three)
HISTORY OF "DIGEO BROADBAND, INC" (continued)
3/17/2000 - Go2Net 1999 Annual Report & Form 10-K
Go2NET shareholder's meeting
(Introduction pages, dated 12/31/1999)
Broadband Services:
Go2Net is positioned to become a market leader in the distribution of broadband portal services by delivering its content, services and technologies to Broadband Partners, which will provide further distribution to Charter Communications, RCN Corporation, and High Speed Access Corporation, our products and services will be exposed to millions of broadband cable subscribers. Go2Net is positioned to be one of the very few Internet companies with a defined and growing broadband distribution footprint. All of our partners in the venture are proven leaders in their respective categories, and our close collaboration should ensure that Broadband Partners captures the sector's vast potential and fully leverages the assets of each participation organization. Our goal with Broadband Partners is to develop the richest possible user experience, via both TV and PC portals....
Sincerely,
Russell C. Horowitz
(pgs.5-6)
Broadband Partners.
On October 1, 1999, Go2Net, Vulcan Ventures, an entity controlled by Paul G. Allen, and Charter Communications Holding Company entered into an agreement in principle to form Broadband Partners, a joint venture. Broadband Partners intends to provide broadband portal services initially to customers of Charter Communications, RCN Corporation and High Speed Access Corporation. In exchange for licensing its products and services to Broadband Partners, Go2Net will receive fixed annual licensing fees and a portion of the advertising and commerce revenues generated by Broadband Partners from the use of Go2Net's content, services and technologies on the broadband platform.
Charter Communications has agreed to use Broadband Partners' portal services exclusively for an initial six-year period that will begin when the portal services are launched, subject to certain exceptions. The joint venture has an initial 25-year term, subject to successive five-year renewals by mutual consent. Vulcan Ventures will own 55.2%. Charter Communications will own 24.9% and Go2Net will own 19.9% of Broadband's capital stock. Vulcan Ventures will have voting control over the Broadband entity. Broadband's board of directors will consist of three directors designated by Vulcan Ventures and one by each of Charter Communications and Go2Net.
Go2Net believes that its participation in the Broadband Partners joint venture will facilitate the distribution of the Company's content, services and technologies through the broadband platform to the customers of Charter Communications, RCN and High Speed Access over the television digital set-top box and through the personal computer.
5/5/2000 - Fortune magazine article,
(Part One: interview of Paul Allen)
(Part Two: interview of Bill Savoy)
Why We're Betting Billions On TV
A Rich Guy With a Vision
By David Kirkpatrick
Mentions (I believe for the first time in print) that the "Broadband Partners" had been renamed "DIGEO Broadband."
5/12/2000 - Puget Sound Business Journal article
Allen's Next Firm: DIGEO
Pushing for Interactive TV
by Sharon Baker
seattle.bcentral.com
(also: #reply-14228585)
Paul Allen is building a new company aimed at weaving together several pieces of his Wired World.
Kirkland-based Digeo Broadband Inc. is hiring at least 30 people as it ramps up a plan to create next-generation content for interactive television and computers. In addition to its in-house staff, Digeo is collaborating with other Allen portfolio companies, including Seattle-based Go2Net Inc. and Charter Communications Inc., the nation's fourth-largest cable company.
Officials aren't saying much about Digeo's plans, and declined to be interviewed for this article. But mentions in the Securities and Exchange Commission filings made by Allen's various companies offer a sneak peek at what Digeo is hatching.
It plans to finish testing the services this year, and the first to view it will be customers of Charter and RCN Corp., a provider of bundled phone, cable and Internet services in which Allen recently invested $1.65 billion.
Heading up the Digeo effort is Jim Billmaier, whom Allen tapped from another of his companies, Click2learn.com Inc. of Bellevue. Billmaier, previously chief executive of Click2learn, is credited with turning around the online learning company after he was brought in from Sun Microsystems.
Allen first began pursuing the promise of interactive television back in 1992 with the creation of Starwave Corp.
By marrying computers with television, Allen and others envision a day when everyone can surf the Internet over a television, and watch movies on demand with VCR-like features such pause, rewind and fast forward. At the same time, consumers could access e-mail, shop from a video catalog, and run some software programs, among other things.
In the early '90s, however, cable, computer and telecommunications companies fought over the direction of the nascent industry, significantly delaying its arrival. Meanwhile, the Internet caught fire.
Although Starwave quickly changed its focus to build on the potential of the Internet, Allen didn't give up on his vision of interactive television.
Now he hopes to deliver on interactive television with Digeo Broadband. The company evidently aims to be an early leader in what Jupiter Communications predicts will be a $10 billion market serving some 30 million households by 2004.
Digeo is jointly owned by Allen's Bellevue investment company, Vulcan Ventures, Charter Communications and Go2Net. Allen owns 30.3 percent of publicly traded Go2Net, thanks to a $419 million investment last year.
Billmaier is in the midst of ramping up his operation, listing 30 job openings on the company's Web site, digeo.com. His team will work closely with Go2Net, which is helping to build an interactive destination site.
Go2Net, run by co-founder Russ Horowitz, has created an Internet destination site, offering such services as a search engine, online gaming, investor areas and an online mall for small businesses, among other features.
Go2Net plans to build on that foundation and create a starting page for Charter's cable subscribers, who will be accessing the site through high-speed connections. Such connections will allow Digeo and Go2Net to create a site with rich, interactive features including sound and video.
Safa Rashtchy, a stock analyst with U.S. Bancorp Piper Jaffray, ran some preliminary figures and estimates that Go2Net could reap as much as $30 million from the Digeo and Charter partnership due to the increased traffic that the company will be able to sell to advertisers.
"They're not investing cash but resources," he added. "It's a tight partnership, and they are getting reimbursed for their share of the expenses."
Go2Net, which holds a 19.9 percent stake in Digeo, is getting reimbursed by Vulcan Ventures for any work the company does over its budget on the Digeo interactive site for the first four years, according to SEC documents.
Vulcan Ventures is also funding Charter's contributions to the partnership for the first four years. In return, Charter has agreed to use Digeo's services for the first six years. Charter also can't engage in any business outside of cable transmission with the exception of the Digeo joint venture, according to SEC documents.
Charter owns 24.9 percent of Digeo, while Vulcan Ventures owns 55.2 percent. The joint venture partnership is for 25 years.
If Digeo can create a site that's up and running by the end of this year, it has the potential to be seen by 7 million Charter customers. That's how many customers will have access to Charter's digital cable infrastructure by the end of the year.
Just how many elect to pay anywhere from $3.95 to $8.95 a month for access to the Internet and other interactive services remains to be seen.
Copyright 2000 American City Business Journals Inc.
5/15/2000 -Fortune Magazine article
(interviews with Paul Allen and Bill Savoy)
Why We're Betting Billions On TV
by David Kirkpatrick
...Allen aims to create a powerhouse collection of businesses for the coming broadband Internet Age...
Allen figures people are finally starting to understand what he meant by the "wired world." Both he and Savoy see the acquisition of Time Warner by AOL earlier this year as a vindication of their strategy. Just as that deal aims to combine content with cable systems for broadband distribution to online consumers, so has Allen assembled a panoply of content and distribution assets that he hopes can all work together.
Although his vision may be getting easier to comprehend, the structure of Allen's investments often remains maddeningly intertwined and complex...Charter, two other Allen-controlled companies, and Go2Net, a portal company in which he has invested, then agreed to create Broadband Partners (now renamed Digeo Broadband), which would create content for the high-bandwidth cable TV...As part of the deal, RCN agreed to use the Digeo portal.
6/6/2000 - Cablevision Magazine article
Paul Allen's Ground Zero
by Staci D. Kramer
(#reply-13837256)
"Your most important and expensive assets in this environment go home every night," says Bill Savoy, Vulcan's president and the man in charge of making sure Paul Allen's ideas become reality. "Much of the value is directly tied to who runs it and how it's run."
"...St. Louis was just a logical place to become our testing ground."
To Savoy, it also makes sense for another reason. "It seems to me as we begin to integrate Charter into our vision of the wired world, we want that management team to experience first some of the technologies that we want to deliver to Charter customers."
They'll get that chance in the very near future, possibly early summer. Some corporate executives in the new-products area are already working with pre-launch versions of a new broadband platform called DIGEO, now being developed by Seattle-based DIGEO Broadband through a partnership of several Vulcan companies including Charter. Plans call for alpha testing using Charter corporate headquarters and some employee homes. The next phase will be beta testing with Charter subscribers in St. Louis, with deployment planned there this year.
"DIGEO takes streaming media, combines it with content and Web browsing to give a full broadband portal over the television set," explains Kent. "We're on track for full commercial roll-out here, and we'll also roll it out in Los Angeles and Greenville-Spartanburg by the end of this year."
Adds Savoy: "The promise of the platform is that the remote control does more than adjust the volume and change the channels. It becomes the device that allows consumers to interact in real time."
DIGEO may be Charter's most valuable experiment, but it's only part of the plans for St. Louis, where Charter is in the midst of a $100 million rebuild and an ambitious franchise swap that will require an almost complete rebuild.
If everything goes as planned--and that's a big if when it comes to the intersection of new technology and cable regulations--three years from now this crazy quilt of outdated infrastructure and state-of the-art rebuilds will be one of the most thoroughly broadband-friendly major metropolitan areas in the country.
Meanwhile, Charter continues to add to the services it can provide the customers it already has in St. Louis. Digital cable is adding channels, video-on-demand is on its way, and executives predict telephony will be offered via its rebuilt fiber-optic network within two years.
6/7/2000 - CHTR Shareholder's Meeting
"1999 Summary Annual Report" (pg. 14)
"We also plan to offer our Internet portal service in St. Louis and other selected markets in 2000, and move ahead with trials of video on demand and telephone service."
6/7/2000 - CHTR Shareholder's Meeting
"2000 Proxy Materials & 1999 Financial Report" (pg. 28)
"The Company has entered into a joint venture with Vulcan Ventures and Go2Net to form Digeo Broadband, Inc. Digeo will provide access to the Internet through a "portal" to our current and future customers and potentially to other providers of high-speed Internet access."
7/26/2000 - INSP/GNET proposed "merger" announced
prnewswire.com
8/2/2000 - CHTR press release
St. Louis (Business Wire)
Charter Communications, Inc. Announces
Second Quarter 2000 Financial Results
...Jerry Kent, President and CEO of Charter (said)..."We also continue to see outstanding growth in the deployment of Charter Pipeline (TM), our high-speed Internet access...
"When fully upgraded, Charter will have one of the most robust broadband services, including DIVA's video-on-demand service, and our DIGEO broadband portal in partnership with DIGEO BROADBAND, INC. These services and more offer just a glimpse of our Wired World (TM) vision."
8/24/2000 - Eastside Journal article
Allen Backed Digeo Leases New Building
eastsidejournal.com
Digeo Broadband, Inc., a company backed by Microsoft CO-founder Paul Allen, has signed a lease to occupy all 50,000 square feet of Forbes Lake Corporate Center, according to several local real estate sources.
The company is owned by Vulcan Ventures, Charter Communications, and Go2Net, all companies in which Allen has an ownership stake.
10/3/2000 - (Business Wire) DIGEO press release
DIGEO CONTACT: Rhonda Hamilton (425-825-4438)
paulallen.com
KIRKLAND, Wash.--(BUSINESS WIRE)--Oct. 3, 2000--DIGEO(TM) BROADBAND, INC. today announced that Carter P. Maguire, Jr. has joined the company as vice president of sales.
Maguire will lead DIGEO's sales organization in expanding MSO cable system distribution of DIGEO's upcoming Interactive TV and PC Portal services.
Maguire comes to DIGEO from Turner Network Sales where he served more than 11 years, most recently as executive vice president. Maguire's responsibilities included overseeing the sales and marketing of Turner Broadcasting's eight domestic programming networks: TBS Superstation, CNN, Headline News, TNT, Cartoon Network, Turner Classic Movies, CNNfn/CNNI and CNN/SI. Before joining Turner, Maguire spent several years at Request Television, The Weather Channel and Home Box Office, respectively.
"We are extremely fortunate to have Carter on board to expand our distribution," said DIGEO CEO Jim Billmaier. "Carter has an excellent track record for managing successful cable network sales organizations and brings a wealth of cable industry experience to DIGEO's well-rounded management team."
Maguire further expands DIGEO's team of seasoned professionals converged from the cable, technology, entertainment and consumer industries. DIGEO currently has more than 150 employees and is headquartered in Kirkland, Wash. Maguire will head up DIGEO's sales efforts from Atlanta.
Maguire earned a bachelor's of business administration in accounting from Emory University, as well as a master's in business administration from Georgia State University, both located in Atlanta.
DIGEO(TM) BROADBAND, INC. is a Wired World(TM) company founded in 1999 with investments from Vulcan Ventures Inc. and Charter Communications. Through its strategic alliance with these investors, DIGEO is dedicated to empowering the nation's cable operators to take the lead in Interactive Television and other broadband services. DIGEO's Interactive TV and Portal services are expected to be available via broadband to millions of customers through its existing arrangements with Charter Communications and RCN Corp., with other MSOs to follow.
10/12/2000 - INSP/GNET merger "officially" approved
(numerous postings on this thread)
10/16/2000 Multichannel.com interview will Bill Savoy
Savoy Remains Calm Amid High Tech Torrent
tvinsite.com
MCN: How do you assess Charter's performance year-to-date, especially in terms of new-service roll-outs?
Savoy: Charter's progress to date is on plan and commendable. As you may remember, after acquiring Charter we very quickly acquired and merged multiple smaller MSOs under the Charter umbrella to amass the nation's fourth-largest operator. Now, our challenge has been to coalesce those assets, and quickly build out the plant so we can offer our customers the benefits of a broadband environment as soon as possible. We are on track to have more than 80 percent of our plant upgraded by year-end 2001.
MCN: Video-on-demand and interactivity are on the horizon. Cable modems are rolling out. Cable telephony is around the corner. Where do you see Charter's greatest revenue upside in the next 24 months?
Savoy: Charter sees significant revenue upside from digital and high-speed data services over the next few years. With a growing digital customer base and enhanced digital services like VOD and interactivity, there is abundant opportunity to see revenue growth from the digital side of the business. Charter should also see a substantial increase in high-speed data penetration over the next couple of years, which will contribute to the growth in revenue. In addition, there is still revenue upside in the traditional cable business through internal growth, and Charter will see this from the acquisitions over the past 18 months.
MCN: How frustrated are you over the pace of cable-modem and DSL roll-outs, since that's impacting your content investments?
Savoy: New technologies always take longer to catch on with consumers then the business world would like. Cable modems and DSL are no exceptions. The pace of acceptance is about what we had expected, and we have planned accordingly in the forecasts of our content investments.
MCN: What's Digeo Broadband Inc. up to?
Savoy: Digeo is creating an integrated TV and PC portal from the ground up, including the delivery of the network infrastructure and aggregation of the content, allowing MSOs, beginning with Charter Communications, to lead the next generation of home-based entertainment, communication, and commerce-all via broadband.
MCN: From an investment standpoint, what sectors or companies are you interested in today?
Savoy: We will evaluate any company that fits under the "wired world" umbrella, but in the past two years, you've seen our most significant investments being in the cable and broadband space.
MCN: Are there sleeper investments in your portfolio?
Savoy: Yes. But we will let them sleep a bit longer.
MCN: What's your view of television-PC convergence, particularly the increasing number in which both devices are in the same room and, often, on at the same time? Is this at the heart of the business opportunities of Paul Allen's "wired world" vision?
Savoy: At the moment, you see both devices in the same rooms in the same homes, one primarily used for business and one for entertainment. Over time, there is no reason those devices will not merge into one-in fact, it is already happening. This ubiquitous, simple, valuable access to information and entertainment is indeed at the heart of Paul Allen's "wired world" vision, and we spend every day looking for opportunities that will be part of it.
11/2000 - CED magazine article
cedmagazine.com
Pie in the sky?
Interactive TV may offer all kinds of e-commerce revenues
for all kinds of companies. Will operators get their cut?
by Angela Langowski, Associate Editor
Interactive TV commerce, or "t-commerce" as it's become known, has been one of those futuristic services that has seemed to be just over the horizon for decades. But now, at long last, the technology is beginning to catch up with the hype.
This year, most of the major cable and satellite TV companies are rolling out interactive systems, at least in test markets. And experts expect tens of millions of households to have access to some sort of interactive television in the next few years.
The Gartner Group predicts that TV portals will generate revenue of $228 per subscriber per year, or $4 billion in 2004. Jupiter Communications estimates the U.S. interactive TV market will address 30 million households and produce $10 billion in annual revenue also by 2004.
Seeing the dollar signs dance before their eyes, cable operators are beginning to get a tantalizing taste of what1s possible in the overall "e-commerce pie," and it1s enough to make their mouths water. The slices of the pie represent a huge market opportunity for a wide variety of companies, including set-top box manufacturers and dozens of software and middleware vendors. RespondTV's interactive system lets viewers use their remotes to click on ads to get more information.
The set-top picture
So what are some of the gizmos out there for TV interactivity? Well, just like there are bakeries full of a variety of tasty wares, cable operators have many choices depending on their taste and, more importantly, what they think viewers will buy into.
Unfortunately, for technology that is meant to be simple, the answer right now is complicated because a free-for-all among box manufacturers, software companies and application developers has erupted. Alliances are being announced between network operators and vendors because no one seems to know yet which has the most compelling products, and all the players appear to be trying to hedge their bets.
Middleware and portal providers
Cable operators can set up their systems to be interactive in one of two ways: piecemeal or as a full system. They can work directly with set-top manufacturers and the companies they've made deals with whose interactive applications run inside their boxes, or in a turnkey fashion with TV "portal" companies such as MetaTV.
Kunkel says as interactivity relates to cable operators, it comes down to incremental revenue and how they can get some of that revenue. How they will do it, he says, is through a multiplicity of applications running through a set-top box.
As far as revenue sharing, WorldGate works with the cable operator to build those relationships with content providers, says Kunkel. Because they're in business with the operator, it1s in everyone's best interest to get the best deals with the best content for enhancement, he says.
The challenge cable operators face in enabling two-way interactivity is that there are so many pieces to enable all the different content areas they're interested in, says Richard Fisher, RespondTV president.
Cable infrastructure1s role
Some cable operators are spending billions upgrading their systems to carry two-way signals, which is a key prerequisite to deployment at any level.
Charter is in the middle of a three-year, $3.5 billion plan to upgrade 135,000 miles of its cable plant to 870 MHz, says John Pietri, SVP Engineering. The upgrade, which started last summer, included cable plant the company inherited through 12 recent acquisitions that weren1t close to 750 MHz and were in rural areas.
Charter's upgrade will add not only two-way interactivity, but will also help provide additional analog capacity, digital video and high-speed data services, says Pietri. He says the company is working on digital video launches and expects to have it available to 90 percent of its customers by the end of this year.
Another cable company whose infrastructure is ready for interactivity is overbuilder RCN Corp., says Rick Rioboli, vice president of technology and marketing.
RCN's HFC network is two-way ready and is being built from scratch with node sizes of 150 homes, says Rioboli. Its strategy was to build the network with small node sizes from the beginning because fewer homes behind a node provides more bandwidth for the customer.
Interactive services the company is working on to deploy beginning next year include VOD and a broadband portal, says Rioboli. RCN is working with Charter Communications and a Paul Allen-created company called DIGEO to deploy these services.
The biggest roadblock to RCN deploying any interactive services is the lack of streaming media middleware and a holdup in the deployment of thick client DCT-5000 boxes, which are needed for the applications RCN wants to deploy, says Rioboli.
"The DIGEO (streaming media) solution is very different from what1s out there and it will really give us a real strong competitive advantage," says Rioboli. "Until that streaming video becomes available, we can't launch a lot of what we think is going to differentiate us. That1s exactly what we1re struggling with nowdo you roll out a Volkswagen right now and then make sure you can upgrade it to a Porsche, or do you wait and put the Porsche on the road sometime next year?"
Cutting through the confusion
The impact of interactive television probably won't be felt for a couple of years as cable and satellite companies flirt with the prospect. But while most of the focus has been on PCs and the Web, the television is contending as the mainstream access method of the future. Competition has driven most of the major cable operators to upgrade their networks and start making deals with middleware vendors and set-top makers for new services. Now it1s just a matter of deciding which ones the public will be willing to pay for.
11/20/2000 - CHTR press release
Charter "beta" launch on 12/5/2000
1/22/2001 - Management shake-up at INSP announced
(numerous postings on this thread)
2/6/2001 - INSP cuts 250 staffers
(numerous postings on this thread)
2/14/2001 - "Paul Allen's Wired World" Website
paulallen.com
"DIGEO (TM) BROADBAND INC. is a Wired World (TM) Company; founded in 1999 with investments from Vulcan Ventures Inc., Charter Communications, and Go2Net. Through its strategic alliance with these investors, DIGEO is positioned to bring the two worlds of the TV and the PC together in a revolutionary new way; creating a next generation interactive viewing experience for both. DIGEO's services will be delivered via broadband to customers of Charter Communications and RCN Corp., with other MSO's to follow." |
