News

Digeo, Moxi Combine Under Allen Umbrella

3/29/2002 4:10 AM Eastern

The whispers have ended: Interactive-TV-software maker and advanced set-top
design firm Digeo Inc. is merging with Moxi Digital Inc., the all-in-one
entertainment-gateway company WebTV Networks visionary Steve Perlman launched
just three months ago.

The merger will effectively unite the development-design teams for two
advanced set-top-box/home-networking boxes, both controlled by chairman Paul
Allen.

Merger terms weren't disclosed, but the deal effectively consolidates Allen's
interactive-TV holdings.

Allen is the primary investor in Digeo, and he joined AOL Time Warner Inc.,
EchoStar Communications Corp., Cisco Systems Inc., Macromedia Inc., The
Washington Post Co., Mayfield and The Barksdale Group in Moxi's $67 million
first round of funding.

Allen will be the largest investor in the combined company, which will be
called Digeo. He is committed to funding it into 2004 -- the date when Digeo
hopes to break even.

Jim Billmaier, Digeo's CEO, will become the CEO of the combined company. Rita
Brogley, who recently took over Moxi CEO duties from Perlman, will be executive
vice president of marketing. Billmaier said Perlman remains a shareholder and
his future role is under discussion.

The company's merged mission will be to create a media center that better
fits consumers' needs.

'The combination will create a more robust product line, better overall
platform and services by fusing best-of-breed innovations and faster time to
market,' Billmaier said.

Digeo has deployed interactive virtual channels to 600,000 Charter
Communications Inc. subscribers, in addition to creating the 'Broadband Media
Center 8000' and '9000' boxes jointly with Motorola Inc. and Charter.

Digeo's interactive-software design that will be combined with Moxi's chip
development, hardware-reference design and satellite deal with EchoStar
Communications Corp.

As for the EchoStar deal, Brogley said, plans remain on track for trials with
the direct-broadcast satellite carrier later this year.

The new company will use Motorola, and perhaps other manufacturers, as
set-top providers.

Joining Allen on the new Digeo board will be Billmaier; William Savoy and
Edward Harris from Vulcan Ventures Inc., Allen's investment arm; Kevin Fong from
Mayfield Ventures, representing the series-A investors, including AOL Time
Warner; and Charter CEO Carl Vogel.

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