Microsoft Makes Another
Interactive TV Investment
The New York Times
January 24, 2000, Monday, Late Edition - Final
By ANDREW POLLACK
In another step toward extending its reach from the personal computer
to the television set, the Microsoft Corporation will invest $56
million in Intertainer Inc., a privately held company that provides
a video-on-demand service, Microsoft executives said.
The deal, which was expected to be formally announced Monday,
would give Microsoft a stake of slightly more than 20 percent
in Intertainer, making it the largest single shareholder.
The investment would allow Intertainer, which is based in Culver
City, Calif., to more quickly introduce its service, which offers
pay-per-view movies, music, television programs and electronic
shopping to personal computers connected to cable modems, high-speed
digital telephone lines or television sets with digital set-top
boxes. The company has started offering its service commercially
in some cities, but has fewer than 1,000 subscribers so far.
Microsoft is trying to position itself as a leading software provider
for interactive television.
trying to make this whole marketplace come true," Jon DeVaan,
senior vice president for Microsoft's consumer group, said Friday.
The investment in Intertainer, he said, would give Microsoft "an
innovative broadband service committed to using its platform."
He said that Microsoft also hopes to work with similar services.
Microsoft agreed in May to invest $5 billion in AT&T in exchange
for a promise that the company, which owns the cable systems of
the former Tele-Communications Inc., would use Microsoft software
in 7.5 million to 10 million digital set-top cable boxes.
Microsoft also bought an 11 percent stake in the Comcast Corporation,
a cable company, several years ago and acquired Web TV, a company
that allows Web surfing using a television set.
Intertainer was formed in 1996 by Jonathan Taplin and Richard
Baskin, longtime Hollywood executives. It has received smaller
investments from Comcast, the Intel Corporation, NBC, and US West.