Cable giant Tele-Communications Inc. (TCI) has confirmed that it is talking to potential partners about television set-top box development, and Microsoft is reportedly one of them.
Microsoft is mulling a possible investment of US$600 million to $1 billion in TCI, the largest cable operator in the US, according to a report in the Wall Street Journal.
Citing sources familiar with the negotiations, the report said that the two companies are in talks and that no deal has been finalised. Microsoft declined to comment on the matter.
TCI officials, while declining to comment on Microsoft specifically, did confirm that the company has been approached by high-tech leaders looking to develop television set-top boxes.
"A number of Silicon Valley companies have expressed an interest in TCI ... in relationship to set-top box development," said a company spokeswoman. "TCI is quite interested in developing a set-top box with an open architecture, but it would be premature to comment on any specfic companies that we might be talking to."
A new generation of set-top boxes is viewed as a way to enable TV viewers to get access to the Internet and digital television services. But TCI's comments today left open the question of whether, even if Microsoft were to invest in the company, the phrase "open architecture" means incorporating Microsoft software to the exclusion of technology from other vendors.
In June, Microsoft invested $1 billion in cable company Comcast Corp., saying that the investment was intended to spur confidence in cable as a high-bandwidth multimedia data conduit.
At the beginning of the year, TCI chairman and CEO John Malone went on a campaign to deflate what he characterised as hype surrounding new digital services, in an effort to reinstill confidence in TCI's core cable-television business.
In recent months, however, TCI's stock price has strengthened, leading to speculation that the company nis now preparing new initiatives to enhance its traditional television-oriented business.