To: Big Bucks who wrote (17389 ) 3/8/1998 11:59:00 PM From: akidron Read Replies (1) | Respond to of 70976
Clark... Marc... Brian... and anybody else that is looking for a boon frm set top boxes... I thought I'd post this... which is as near to a fact as I coulds find... IMO u can ingnore all the projections of the market's growth, or a least discount them... malone's been overestimating digital subs and underestimating capital cost for a decade... but whai is interesting is that even at first when they try to sell them for $300, they are looking for a proccesser that they can buy for $10... in other words... for nothing.... set top boxes for all the hype are just gonna be anothe dumb piece of electronic junk sitting next to old video game consoles next to your tv.... :19 PM 3/6/1998 Intel's cable chip too costly, TCI says Bloomberg Business News ENGLEWOOD, Colo. -- Intel Corp. won't supply the microprocessor chips for the next generation of cable television set-top boxes because its products are too expensive, Tele-Communications Inc. Chairman John Malone said. Malone is leading the cable industry's effort to develop the digital boxes, which could be installed in 25 million homes in the next five years. TCI will likely use processors from MIPS, a unit of Silicon Graphics Inc., or SGS-Thomson Microelectronics NV, said Malone, who expects to make a decision in mid-April. The advanced boxes will give consumers high-quality pictures, hundreds of channels, the Internet and interactive services such as shopping over their television sets. Malone said the selection of a chip maker is based on the need to keep the cost of the boxes at about $300 per box. "You can't give all the money to Intel and still meet your price objective," Malone said. The potential market for box suppliers is huge: About 60 million U.S. homes have cable television. TCI and eight other cable companies placed a $4.5 billion order in December with General Instruments Corp. for 15 million of the new boxes, and more orders are expected to follow. Malone said there eventually will be a version of the cable box that will have an Intel processor. It will be specially designed for video telephone service and video e-mail, which need powerful processing capability. To keep the price of a basic digital box at about $300, the processors will need to cost about $10 each with the ability to process more than 200 million instructions per second, Malone said. Intel's 200 MIPs processor costs about $200, he said. Malone spoke following a shareholders' meeting of TCI Satellite Entertainment Inc., which he also heads. Intel, while it does make chips for use in so-called embedded applications, doesn't have an ideal chip right now that's suited for the boxes. "Indications have been for some time that we wouldn't get this business," said Tom Waldrop, an Intel spokesman. Intel shares rose 2 9/16 to 78 1/8 and TCI gained 1 1/4 to 30 5/16. SSG-Thomson's American depositary receipts rose 1 1/4 to 69 15/16 and Silicon Graphics rose 1/2 to 14 3/4.