To: Maya who wrote (27396 ) 1/1/1998 11:28:00 PM From: CPAMarty Respond to of 50808
BN 12/31 Microsoft Set to Unveil $1 Bln Investment in TCI, Analyst Says Microsoft Set to Unveil $1 Bln Investment in TCI, Analyst Saysbloomberg.com Redmond, Washington, Dec. 31 (Bloomberg) - Microsoft Corp. is expected to unveil a $1 billion investment in Tele- Communications Inc. at next week's Consumer Electronics Show in Las Vegas, an analyst said. The investment would be intended to speed up the development of TV set-top boxes that link TVs to the Internet, said Rob Enderle, an analyst with Giga Information Group Inc., a Cambridge, Massachusetts-based provider of analysis and advice on the information technology industry. TCI would use the investment to upgrade its cable-TV network for new-generation set-top boxes, which will deliver services ranging from web-linked television programs to electronic mail to home shopping, said Enderle. Microsoft plans to sell software, including the Windows CE operating system, for use in the set-top boxes, which will start shipping in limited quantities in the first half of next year, he said. Microsoft spokesman Mark Murray said the company wouldn't comment on Enderle's statement. ''This sounds very much like a rumor, and Microsoft has a policy of not commenting on rumors one way or the other,'' Murray said. TCI officials couldn't immediately be reached for comment. An agreement between Microsoft, the world's biggest maker of personal-computer software, and TCI, the biggest cable TV company, would help extend Microsoft's reach beyond the desktop and into consumers' living rooms. Microsoft Chairman Bill Gates has repeatedly promoted a ''Web lifestyle'' that would create demand for the company's growing range of Internet-based software. ''This will create a wave, a level of consumer demand that pushes Microsoft's technology,'' said Enderle. That technology includes software for sending and managing higher-quality sound, pictures and data through the cable network, he said. The hardware specifications for the set-top boxes largely have been worked out through Cable Laboratories Inc., the industry's research arm, Enderle said. The software specifications still are in development because of the difficulty of sending high-quality data through existing cable networks and the uncertainty of how fast the networks will be upgraded. Cable subscribers will pay for the new boxes through their monthly fees, rather than by a one-time charge, Enderle said. Distribution of the boxes will be increased gradually over the next 1 1/2 years, he said. Microsoft shares fell 1 to 129 1/4, while TCI's Class A shares fell 7/16 to 27 15/16. --Laura Raun in Seattle (206) 224-3173 through the New York newsroom (212) 318-2300 /ag