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TCI in talks on cable boxes
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December 15, 1997: 6:51 a.m. ET
Intel, Microsoft hope to arm customers with NC's, report says
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NEW YORK (CNNfn) - Tele-Communications Inc. is reportedly in negotiations with several top technology companies in hopes of supplying cable customers with the advanced set-top boxes needed for connection to the Internet.
Microsoft Corp. and Intel Corp., among others, want to supply the nation's largest cable provider with as many as 10 million so-called "network computers" for the next-generation of cable television, the Wall Street Journal reported on Monday. The deal is valued in excess of $3 billion.
The size of the order could become as high as 25 million units depending on the success of TCI's venture.
The deal is considered critical to growth of both the cable and personal computer industries.
Cable companies such as TCI have tried with little success to transform television into an interactive service.
Meanwhile, the PC market has stalled at about 40 percent of the nation's households. Companies such as Microsoft and Intel have been trying to increase the market by establishing industry standards for digital TV.
TCI, of Englewood, Colo., has set Monday as the deadline for submission of technical and financial proposals.
Speaking at last week's Western Cable Show in Anaheim, Calif., TCI's chairman John Malone said he expects the average American will soon be able to take advantage of not only e-mail services but also electronic commerce features over the TV set.
"I really think this will be a bombshell on Madison Avenue," Malone said.
"When you have 10 percent market penetration, it is of some interest to advertisers, but a universally deployed platform of services should be of huge economic interest to every merchant," he was quoted as saying.
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