Gemstar-TV Guide International Inc. may be losing its lock on the interactive program guide business.
Several cable systems owned by Comcast Corp. and Charter Communications Inc. recently switched out Gemstar's TV Guide Interactive IPG for the product provided by the TVGateway consortium, which is backed by those MSOs and WorldGate Communications Inc., MSO officials confirmed last week.
WorldGate formed TVGateway last summer, along with Adelphia Communications Corp., Cox Communications Inc., Comcast and Charter.
When it was formed, TVGateway's founders said the goal was to create competition for Gemstar, which has used its strong patent portfolio to dominate the market. But until now, TVGateway's only launches were on a few small cable systems owned by operators outside of the consortium. The consortium itself hadn't taken the idea beyond the press release that announced the formation of the company.
Comcast and Charter are now signaling they're serious about commercial deployments. And executives at Cox said they would eventually like to migrate all of the MSO's systems to a single IPG, and TVGateway could be that guide.
Comcast recently switched out TV Guide for TVGateway in Mobile, Ala., and Willow Grove, Pa., company officials said.
"The real reason that we've done this is to keep our options open, as to our ability to roll out new products," said Dave Watson, Comcast executive vice president of marketing and customer service, who noted that Gemstar-TV Guide hasn't integrated with any video-on-demand vendors.
"The current plan is to evaluate these two systems, and continue to hopefully have fruitful discussions with TV Guide as well," Watson said.
All 13,000 digital subscribers in Comcast's Mobile system have TVGateway. About 5,500 subscribers on the MSO's Willow Grove system also have the guide.
Some consumers have had questions about the new guide, but there haven't been complaints about the change, Watson said.
Charter has dropped TV Guide for TVGateway in LaGrange, Ga., and a "handful" of other systems, spokesman Dave Anderson said.
Though LaGrange was the only system Anderson would name, a customer-service representative at Charter's Leveland, Texas, system said the company has dropped TV Guide for TVGateway in several Texas communities. Those include Brownsfield, Leveland, Slaton, Morton and Littlefield.
Officials at WorldGate, which owns 20-percent equity in TVGateway, wouldn't discuss the deployments. The company said it's up to its MSO partners to name their deployments.
The only TVGateway launches the company has announced were with AT&T Broadband and MetroCast Cablevision in New Hampshire, which counts 35,000 subscribers.
In November, AT&T said it would launch TVGateway and WorldGate's Internet television service in Tacoma, Wash., and Waterloo and Cedar Falls, Iowa.
Although AT&T has an exclusive IPG licensing deal with Gemstar, the company said it would use the TVGateway IPG temporarily because Gemstar hasn't integrated its IPG with WorldGate's Internet service.
Some cable executives have said TVGateway's ability to integrate with other ITV applications will help it compete against Gemstar, which has been slow to integrate its IPG with ITV applications such as video-on-demand.
"We could dictate to TVGateway what video-on-demand offering we want to integrate to. It's not as easy for us to dictate to Gemstar-TV Guide what video-on-demand offering we want them to integrate to," Cox senior vice president of strategy and development Dallas Clement noted.
Although Cox has made no TVGateway deployments, Clement suggested a rollout might be on the horizon. The company currently uses three guides: 40 percent of its subscribers use the Scientific-Atlanta Inc.'s Sara IPG; 20 percent use Gemstar's Starsight electronic program guide and 20 percent use TV Guide Interactive, he said.
Eventually, Cox would like to migrate all of its cable systems to a single IPG, or might use a maximum of two guides nationwide, Clement said.
While he said TVGateway could be its IPG for the future, he said Cox could end up going with TV Guide instead.
"It would be silly for Cox to continue to expend human and capital resources toward something like TVGateway if we didn't think that there was merit in it," Clement said.
TVGateway does lack some features that Cox would like to see added, including parental control and the ability to facilitate impulse pay-per-view orders, Clement said. But he said TVGateway plans to add those features.
Massillon Cable in Ohio still hasn't decided if it will use TV Guide or TVGateway for its digital launch, scheduled for March, said Bob Gessner, president of the 50,000-subscriber system. Massillon has already deployed WorldGate's Internet service.
"We've had a long relationship with WorldGate, and we know their equipment works, and they've been a strong, customer-service oriented company," said Gessner. "But obviously, TV Guide right now is the leader in that interactive program guide field."
The Massillon chief recently took a tour of Comcast's Willow Grove, Pa., system to see TVGateway in action.
Gemstar-TV Guide co-president Peter Boylan couldn't be reached for comment last week. But he sent an email to Multichannel News Friday afternoon, stating: "We remain 100 percent confident with our patent position, and as of this moment we continue good faith negotiations with these [Charter and Comcast] parties. We don't consider WorldGate a viable alternative to TV Guide interactive."
Gemstar, which extracted a $200 million IPG patent- infringement settlement from Motorola Corp. in October, has similar suits pending against Scientific-Atlanta, Pioneer New Media and TiVo Inc.
Pioneer announced last week that it has sold 1.3 million copies of its Passport IPG, as well as 1 million "Voyager" digital set-tops.
The company announced in May that it had ported the Passport IPG to the Motorola "DCT-1000" and "DCT-2000" set-tops-the same platform that Charter and Comcast are using for their TVGateway deployments.
But Pioneer vice president of software engineering Haig Krakirian said last week that the company hasn't yet completed the integration process and therefore wasn't ready to deploy Passport on the Motorola platform.
Meanwhile, a new IPG vendor-iSurfTV-is waiting on the sidelines, ready to pounce on the guide market. The Sunnyvale, Calif.-based start-up is pitching cable operators a software suite that includes a portal and a multimedia IPG.
Last week, iSurfTV CEO Gene Feroglia said the company is 60 to 90 days away from announcing a major deal with a U.S. operator.
"It's something that's going to allow us to have north of 1 million homes. It's not small," Feroglia said.