Microsoft TV Debuts Digital Package

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Microsoft Corp. is unveiling the next generation of its Microsoft TV product,
"Microsoft TV Foundation Edition," built around a core interactive program guide
that doubles as a gateway to sell expanded cable services like video-on-demand,
as well as merchandise.

Microsoft executives are calling the guide a digital-television-software
solution and, in a visit to Microsoft TV's San Jose, Calif., headquarters to
preview the product, company executives made clear Microsoft's desire to build
products cable operators will use in the here and now.

"We have to invest in incubating new scenarios and applications that matter
to MSOs and applications that matter to consumers," said Moshe Lichtman, vice
president of Microsoft TV. "We're trying to be a good partner."

In a sense, the new software is a throwback for Microsoft TV, a division that
consistently pushed the envelope in developing new services that found little
audience among U.S. cable operators.

In the briefing Microsoft gave to Multichannel News, there was no talk
about "middleware" or "interactive television." Instead, Microsoft showcased a
TV-centric first-screen, graphically rich digital-cable portal that included
traditional guide features, navigational systems to on-demand features and
plenty of advertising and merchandising opportunities operators can use on
today's base of imbedded digital set-tops.

There are signs that Microsoft's new direction has been influenced by Comcast
Corp., now the country's largest MSO.

Microsoft chairman Bill Gates invested in the company years ago, but that
hasn't translated into any inroads on the product front. However, at the
National Show this week, Gates is joining Comcast president Brian Roberts on the
opening panel, marking Gates' first NCTA appearance in several years. He's
expected to mention the new Foundation Edition product.

The portal can be customized by the MSOs, but in the version Microsoft is
showing at the National Show, the company lists seven segments -- news, weather,
sports, entertainment, kids, lifestyles and games -- after the opening linear
guide screens. A core focus is on VOD.

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