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Point and click TV

Finally, interactive television may be poised for a prime-time run.

©New York Times

© St. Petersburg Times, published December 6, 1999

LOS ANGELES -- Like millions of other Americans, Tim Tainter likes to play along with the contestants on Jeopardy, the syndicated TV game show. Unlike most viewers, however, he uses his Microsoft WebTV remote control to click on multiple-choice answers that appear on his screen along with the live telecast.

"There's no learning curve," said Tainter, 44, an airline catering worker, as his latest score was zapped to a database at Columbia TriStar Television, the Sony division behind the show; there, he was ranked against other home players. "You just put your thumb on a button and press."

Analysts say point-and-click simplicity explains how interactive television, after a history of spectacular flops, finally may be poised to take off. And through its WebTV subsidiary, Microsoft quietly has taken a lead over America Online, seen by analysts as its chief rival in the field.

Through computer codes inserted invisibly in a standard broadcast television signal, WebTV can add features such as play-along games, sports scores, stock quotes and chat rooms to any program on any television set that is connected to a WebTV box.

This season, interactive features have been added to Wheel of Fortune, the popular game show, and to programs such as NBC Nightly News and Dateline. PBS also has inserted them, along with cable channels such as MSNBC, HBO, the Learning Channel and Home and Garden Television.

Interactive television has been rethought repeatedly since its original incarnation as an information vehicle was made obsolete by the personal computer and the Internet before it passed the pilot project stage. Until recently, the most popular idea was to provide Internet access to consumers who did not have computers, as Microsoft set out to do with WebTV.

But the company is repositioning WebTV as a conduit for services such as interactive programming, interactive advertising and home shopping for the 100-million American households with television. About 800,000 WebTV subscribers pay $24.95 a month for the service, and the company wants to double its membership each year.

"Microsoft really wants to get into the living room," said Gary Arlen, president of Arlen Communications, a market research concern that studies interactive media. "And they'll do whatever it takes to get there."

Not every TV executive is comfortable with the image of Microsoft charging into prime-time television, especially after a federal judge said that Microsoft wielded monopoly power in the PC operating system market to its competitors' detriment.

America Online has plenty of allies for its interactive TV rollout, scheduled for 2000. The list includes the DirecTV satellite broadcast unit of Hughes Network Systems; the set-top boxmaker Philips NV; a digital video recorder manufacturer, TiVo Inc.; and Liberate Inc., a software business partly owned by AOL, Sun Microsystems and Oracle Corp.

AOL will have some catching up to do. WebTV will unveil a software upgrade for the DishPlayer satellite TV devices from EchoStar Communications; the upgrade will allow users to digitally record, rewind and fast-forward TV programs. And Microsoft's investments, in the billions of dollars, in cable operators such as AT&T and Rogers Communications will begin paying off next year.

The cable companies have agreed to use a stripped-down version of Microsoft's Windows CE operating system, called Microsoft Television, in millions of cable set-top boxes in the United States and in Europe, according to Bruce Leak, a co-founder of WebTV who now directs Microsoft's TV efforts.

Operating on digital cable lines, the new boxes will give customers much faster access to WebTV's services than they now have through 56-kilobit telephone modems.

Leak has visions of interactive television surpassing the personal computer. "I think it's bigger than the Internet," he said at WebTV's headquarters in Mountain View, Calif. "All the elements are there for it to happen."

In those 100-million television households, the TV is on for an average of 71/2 hours a day, Leak said, while only 30-million households use computers online, averaging less than an hour a day. By themselves, Jeopardy and Wheel of Fortune have "all the reach of the Internet," he said.

Those statistics are not lost on America Online, whose 19-million subscribers, most of them in the United States, make up the world's largest online community. The company plans to begin aggressively marketing AOL TV to its subscribers next summer, offering popular AOL features such as e-mail, chat rooms and navigation bars through their televisions for an additional monthly fee.

"We think the market is ready for another place in the home with AOL-style things," said Barry Schuler, president of AOL Interactive Services. "We think we can ramp up to multiple millions of boxes just within our own audience."

While WebTV fired the "first volley," Schuler said, interactive TV is "going to go through several generations before it becomes a mass market," leaving AOL plenty of time to catch up.

Most industry executives and analysts agree that interactive TV would need a few years to catch on, just as mass-market cable did in the early 1980s. But by 2004, Forrester Research expects that 51-million American households will be using interactive television, a market it estimates at $20-billion.

Of course, proponents of interactive TV have made rosy predictions before. Companies such as Time Warner and Tele-Communications had big numbers in mind when they undertook expensive trials of interactive TV in the early 1990s, but failed to commercialize the medium.

It took years of plummeting technology prices and expansion of high-speed voice and data communications capacity before interactive television could re-emerge as a feasible idea. WebTV was one of the first to dive in.

Begun four years ago at a former used-BMW dealership in Palo Alto and bought by Microsoft in 1997, WebTV employs 600 people and occupies three of the five buildings on Microsoft's new Silicon Valley campus along U.S. 101.

Leak said WebTV's growth would promote competition, not stymie it. "Our strategy has been: "Look, we have the best technology. Let's license that incredibly broadly to create a standard,' " he said. "We want the industry to move forward. We're happy to compete."

As large as its ambitions are for WebTV, Leak said, the company will not get into producing TV shows, though it may invest in them. Partners such as Columbia TriStar and NBC will do the programming work. Leak said he recognized that people have "more or less fear of Microsoft" dominating the emerging interactive medium.

"Hopefully, we can get people who have preconceived notions of Microsoft to understand that we're trying to work with people," he said. "Maybe it's the new kinder, gentler Microsoft."

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