Microsoft Joins @Home Solutions

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Microsoft Corp. has joined other equipment suppliers as a
partner in the @Home Solutions venture, which offers broadband Internet-access systems to
small and midsized cable operators.

Microsoft will become a preferred vendor to the venture. It
will begin working to incorporate its Windows NT server-operating system into @Home
Network for the Solutions markets, and it will provide other technology and marketing
support.

The companies did not verify reports that Microsoft had
made a $5 million investment in the venture. Its charter partners -- 3Com Corp., Cisco
Systems Inc., Motorola Inc. and Falcon Cable TV Corp. -- have contributed $20 million of
equity financing.

@Home Solutions also said the deal was in the works long
before Microsoft announced two weeks ago that it would make a $5 billion investment in
AT&T Corp. AT&T is the majority shareholder of @Home Solutions' parent, @Home
Network.

In return, Microsoft gets a significantly larger role for
its Windows CE operating system in AT&T digital set-top boxes.

@Home Solutions chairman Dean Gilbert said the ability to
use NT solutions will give the venture more flexibility in designing networks to serve
smaller markets, where it may be less cost-effective to use the UNIX-based solutions @Home
already employs.

"It's pretty clear that the world out there is
not just a UNIX world -- it's also an NT world," Gilbert said. "It's
very important for @Home in its desire to be fairly agnostic and have an open
architecture. Just as we support Netscape [Communications Corp.'s Navigator Web
browser] and [Microsoft's] Internet Explorer [browser], we want to be able to support
both UNIX platforms and NT."

Gilbert was unsure how long it would take to incorporate NT
into the architecture.

Although the two investments were not related,
incorporating Windows NT with the @Home turnkey networks coincides with AT&T's
agreement to license NT server software for its digital-video and data-services solutions
delivered through Windows CE set-tops.

Falcon -- which has upgraded about 20 percent of its 1.9
million homes passed to two-way plant -- is the only MSO to announce an affiliation with
@Home Solutions so far, although Gilbert said announcements were pending on several other
agreements.

Meanwhile, other turnkey providers focusing on the small to
midsized cable market continue to build on their early lead.

SoftNet Systems Inc.'s ISP Channel earlier this month
reported that it had signed eight new affiliates and launched 14 new broadband
Internet-access systems, giving it 31 commercially operating systems in 13 states.

ISP Channel also launched a new marketing campaign covering
all markets where it provides service, offering half-priced installation and one free
month of service to new subscribers through the end of June.

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