To: Duane L. Olson who wrote (33739 ) 11/11/1999 6:47:00 AM From: Dorine Essey Respond to of 74651
FOCUS-Taiwan Gigamedia, Microsoft working out deal -------------------------------------------------------------------------------- TAIPEI, Nov 11 (Reuters) - Executives of Taiwan's Gigamedia are in Seattle hashing out details of Microsoft Corp's MSFT.O plans to invest in the broadband Internet service provider, a Gigamedia executive said. Local media have said Microsoft was considering investing T$1 billion (US$31.5 million) or more for a stake in Gigamedia, which already is well-financed and providing high-speed Internet access to businesses and homes. Gigamedia Ltd chairman Chester Koo and Microsoft brass would be ready to announce details of the U.S. software powerhouse's investment in the next few days, the executive said in Taipei. "I can't give you more details because our top-level company leaders are all in Seattle and only they know," said the executive, who declined to be identified. Gigamedia invited media to a Taipei news briefing on Monday to disclose details of "investment contracts being signed in America" by Koo. The invitations did not mention Microsoft. In Seattle, Microsoft told Reuters on Wednesday it was planning a major announcement on Friday with Gigamedia parent Koo's Group, a powerful family empire with interests ranging from cement to banks and media. For weeks, Gigamedia executives have confirmed that they were in closed-door talks with Microsoft and that an equity stake was possible, but insisted the details were still being hammered out and declined further comment. As of mid-September, the year-old Hoshin Gigamedia Center Inc had only about 5,000 subscribers -- but has potential access to much of Taiwan as a subsidiary of Koo's Group. Koo's cable franchises dominate the cable TV market, serving about half of all households on the island of 22 million people. Gigamedia will have to move fast. As Taiwan breaks up the longtime monopoly in its fixed-line telephone market, most bidders for phone franchises are planning broadband systems that will offer speedy Internet access as well as telephone and cable television service down a single wire. Even the privatising phone company, Chunghwa Telecom, is planning a range of high-speed Internet choices at varying costs. Gigamedia says it hopes to distinguish itself in content as well as speed of access. As a member of Koo's Group, whose sprawling interests range from Chinatrust Commercial Bank 2815.TW to Taiwan Cement Corp 1101.TW, Gigamedia can call on an army of off-line allies to offer more than just entertainment. Gigamedia executives have said they want to harness Taiwan's explosion of cable companies and freewheeling TV channels, sparked by a decade of media deregulation, to carve out a digital empire in the Chinese-speaking media world. Microsoft, for its part, has been keen to expand its presence in the nascent but fast-growing Chinese-language Internet market, which is most developed in Taiwan, Hong Kong and Singapore but also is flourishing in mainland China where the prospects for growth are immense. (US$1=T$31.75) REUTERS Rtr 04:50 11-11-99 Copyright 1999, Reuters News Service