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To: NY Stew who wrote (2155)	2/29/2000 7:40:00 PM
From: Teflon	Read Replies (2) \| Respond to of 6516

Thanks for the post, Stew. BTW, any thoughts on LBRT or WGAT? On my radar screen and I am not sure if you've already tossed these issues around? Teflon

To: NY Stew who wrote (2155)	2/29/2000 8:01:00 PM
From: LBstocks	Respond to of 6516

FOCUS-Microsoft buys Israel interactive TV developer (Updates with comment from Microsoft executive, Elbit, adds background, pvs REDMOND) By Scott Hillis SEATTLE, Feb 29 (Reuters) - Microsoft Corp. (NasdaqNM:MSFT - news) said on Tuesday it will buy Israel's Peach Networks Ltd., which provides Internet services over cable television networks, in a deal the software giant said will let it deploy interactive TV to millions of previously unreachable digital set-top boxes. Peach Networks, headquartered in the Israeli city of Or-Yehuda, is owned by Haifa, Israel-based Elron Electronic Industries Ltd. (NasdaqNM:ELRNF - news) and its subsidiary, Elbit Ltd.(NasdaqNM:ELBTF - news). Microsoft said the purchase of Peach would give it the ability to offer e-mail, Internet, shopping and entertainment services through its Microsoft TV platform to digital cable boxes that were designed before the rise of the Internet. ``For quite some time we've been looking into a variety of technologies that would not isolate the digital set-top boxes that were really designed before the Internet revolution,' Alan Yates, director of Microsoft TV platform strategy, said in an interview. The Redmond, Wash.-based software powerhouse has been pushing its Microsoft TV platform as it strives to develop a range of non-PC devices that analysts say are the next big market for Internet services. Although Microsoft has led the television-based Internet service with its WebTV product, analysts expect it to face stiff competition from a similar service being rolled out by America Online Inc. (NYSE:AOL - news), the country's biggest Internet access provider. While the latest set-top boxes contain powerful chips and software that can run rich interactive features like e-mail and Web browsing, millions of older boxes were not designed with such abilities in mind. Peach's technology processes such interactive features from a cable network's servers, the workhorse computers that store and deliver data and multimedia content, and delivers it to the consumer's box. Yates said that would let Microsoft potentially reach the 4 million customers that are forecast to be using such low-end or older boxes by the end of this year. ``We think it's a very nice addition to the menu of products that we offer, and in particular solves a key problem for network operators. It allows them to bring those services to those boxes as well,' Yates said. Although Elbit stopped short of saying it had closed a deal with Microsoft by instead declaring it was in ``advanced negotiations,' Yates said that wording was a requirement of Israeli law that such deals be publicly declared before they are officially finalized. ``We're both comfortable that the terms of the deal are complete,' Yates said. Elbit, which is 42 percent owned by Elron, said it would receive about $43 million in cash for its 57 percent stake in Peach, and would pocket about $30 million in net capital gains. Elron said it would record a gain of about $12.5 million. Microsoft shares fell 2-3/16 to 89-3/8 in trading on the Nasdaq on Tuesday. Nasdaq-listed American Depository Receipts of Elron rose 7/8 to 50-3/8, while those of Elbit fell 52/64 to 18-7/16. Both companies rose in Israel on Tuesday amid rumors of the deal. biz.yahoo.com