NCI wins one over WebTV

Network Computer Inc. may have shurgged off its recent troubles with the announcement that Cable & Wireless (CWC)has struck a deal to deploy NCI's digital television operating system software in its upcoming rollout of cable set-top boxes. NCI's DTV Navigator platform - a competitor to Microsoft's WebTV - will allow users of CWC's cable-based set-top boxes to access Internet content in addition to viewing digital television channels. And it will be heading this way, courtesy of CWC's stake in Optus telecommunications.

Network Computer Inc. may have shurgged off its recent troubles with the announcement that Cable & Wireless (CWC)has struck a deal to deploy NCI's digital television operating system software in its upcoming rollout of cable set-top boxes.

NCI's DTV Navigator platform - a competitor to Microsoft's WebTV - will allow users of CWC's cable-based set-top boxes to access Internet content in addition to viewing digital television channels. And it will be heading this way, courtesy of CWC's stake in Optus telecommunications.

CWC has declined to comment on how much it has agreed to pay NCI for the use of its DTV Navigator technology.

CWC will roll out the cable set-top boxes in selected cities in the UK in the third quarter, with nationwide availability at the end of 1998, said Roy Payne, a company spokesman. The company has not come up with projections on how many boxes it expects to ship, Payne said.

The first services available will be 200 channels of digital television, an electronic programming guide and Internet access, with a view to offer targeted interactive services such as home banking and shopping in 1999, Payne said.

NCI is a joint venture between Oracle and Netscape.

CWC, which is investing 100 million pounds ($US165 million) into digital set-top box development over the next year, looked at WebTV but decided that it was locked into a single vendor and would be difficult to implement, Payne said. The same was true for the set-top box operating system from OpenTV Inc., he said.

"All future development [in the Internet arena] will be based on Java or HTML script," Payne said. "If you go down proprietary route, you are bound to the developments made by the owners of that particular technology."

The DTV Navigator platform, which is based on Netscape's Navigator browser, won out because it is based on Java and Internet standards, Payne said. As a result, applications being developed for the Internet will work on the cable set-top boxes without any special development on CWC's side, he said.

Retailers and banks are setting up electronic-commerce Web sites using Internet standards, so CWC wanted to make sure its set-top box operating system could take advantage of those standards, Payne said. CWC wasn't convinced that WebTV's proprietary model would allow the company to deploy new services in a timely and simple manner, he added.

In addition, the DTV Navigator operating system is built with an eye to broadband networks, such as cable, Payne said. WebTV, on the other hand, is based on a dial-up model that relies on a phone line, he said.

Signing on CWC to use the DTV Navigator technology is a minor coup for NCI, but that doesn't necessarilly mean that other set-top box distributors will now come running to NCI, said Andy Greenman, an analyst at the Yankee Group in London. NCI has signed few big-name contracts for its technology either in Europe or the US., and it will take more than CWC lending its weight for NCI to triumph, he said.

Until a standard for set-top box operating systems is agreed upon in Europe, the decisions of particular companies to go with technology from OpenTV, WebTV or NCI won't make much difference, Greenman said. Developers of content and services for set-top boxes are waiting for a standard to emerge before jumping into full-scale development projects, he said.

Many services are being developed in Java and HTML -- which is a plus for the NCI platform -- but if NCI's platform isn't based on the final set-top box standard, it will have trouble catching on, Greenman said.

CWC's cable-based set-top boxes will go up against strong competition in the U.K.'s digital interactive television arena. Already, British Interactive Broadcasting (an alliance grouping between British Telecommunications PLC with BSkyB PLC) has announced plans to launch a satellite-based set-top box service offering Internet access, while British Digital Broadcasting (a joint venture between Granada Television and Carlton) will offer land-based boxes.

CWC, which offers cable service to 4.2 million homes in the U.K., claims that the inherent two-way nature of cable systems in the U.K. will allow users the fastest TV-based Internet connection to date, according to Payne. Satellite and digital terrestrial services rely on the phone line for a return data path, which can slow Internet browsing to a crawl, Payne said.

In addition, CWC plans to give the boxes away at no cost, with users paying a premium for digital interactive services, while satellite operators are planning to charge around 200 pounds per box, he said.

Cable & Wireless PLC, CWC's parent company, will provide the set-top box technology to its subsidiary companies around the globe, particularly Optus Communications Pty. Ltd. in Australia and to Hong Kong Telecommunications Ltd., the company said.

Cable & Wireless PLC, based in London, can be reached at at http://www.cwplc.com/.

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