Digital TV makes long-awaited debut

Bob Tourtellotte

LOS ANGELES: The cable television industry has been promoting the dawn of

digital television for the past few years, but this year's Western Show, the

cable television industry's largest trade show, opened here on Tuesday with a

whisper of change in the air.

"This year, it's all about what's being offered. What is being offered,

the real content, the real applications, the real platforms, the real

boxes," Mitchell Kertzman, chief executive officer of interactive software

provider Liberate Technologies Inc. told Reuters.

After years of talk about the 500-channel universe that digital cable and

broadband would bring - services like interactive TV and easy-to-use program

guides - a few US homes have actually seen such services in the past year. Many

more are scheduled to see them in 2001.

Indeed, the theme of the show, which lasts through December 1 at the Los

Angeles Convention Center, is the "Broadbandwagon", as in jump on and

don't get left behind.

In 2000, several of the larger cable TV companies like Comcast Corp. and

satellite providers like DirecTV, a unit of Hughes Electronics Inc. and EchoStar

Communications Inc. have spent millions building the infrastructure and

deploying digital set-top boxes in homes to begin offering enhanced services.

In their early forms, those services provide ways to more easily search

through the clutter of television shows to find shows to watch. In some cases,

they also allow viewers to order a limited range of products like pizzas and

seek product information or coupons from advertisers - a linkage expected to

boost revenues for cable TV system operators.

Industry watcher Forrester Research expects 4.9 million homes to have some

sort of interactive video service by the end of 2000, and it sees that number

more than doubling to 12.2 million in 2001. That's up from only 700,000 homes in

1999.

Kertzman said Liberate, whose software is one of the leading systems being

deployed by cable set-top box makers, had services in 300,000 homes at the end

of the last quarter. And he said he expected to confirm many hundreds of

thousands more users at Liberate's next quarterly report set for December 20,

although he declined to give a specific figure until then.

OpenTV Corp., another provider of interactive software for set-top boxes, has

enjoyed rapid success in the United Kingdom, launching its service there in

October 1999 and now reaching about one in six UK homes, according to its own

figures.

Whereas at past Western Shows, a lot of joint venture deals and product

development deals that were announced seemed to lead nowhere, this year a couple

of programming deals were unveiled on the first day.

Comcast said it would deploy interactive TV (iTV) services from Wink

Communications Inc. over its system. And Mixed Signal Technologies, another iTV

service provider, which creates the interactive versions of TV game shows

"Wheel of Fortune" and "Jeopardy" for cable TV's Game Show

Network, unveiled a live, interactive program for Home Box Office, a unit of

Time Warner Inc.

"The content companies, in general, are now looking at this as an

opportunity and beginning to understand that the technology is there and

consumers want to use it," said Joe Franzetta, senior vice president of

corporate development and strategy for Mixed Signal.

While the show kicked off Tuesday afternoon, the big day will be Wednesday,

when industry heavyweights like USA Networks Inc. chairman Barry Diller and

Liberty Media chairman John Malone talk about the market size for these new

digital services.

Also in attendance on Wednesday is Oracle Corp. chairman Larry Ellison, who

is scheduled to talk about networked computing and broadband technology.

On Thursday Cisco Systems Inc. chief executive officer John Chambers will

discuss networking and the future of broadband communications.

(C) Reuters Limited 2000.