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Mystery ‘EU client’ orders 2.5m ADSL CE devices

A breakthrough for Microsoft - but with whom?

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Rumour has been raging about a mysterious "EU client" for large numbers of set-top boxes since Illinois-based Dauphin Technology part-announced the deal in February. Dauphin has now revealed that the deal is for 2.5 million CE-based units at a total value of $500 million, and although the company still won't say who the "other participants" are, Microsoft is strongly-tipped as one. Microsoft will undoubtedly have been involved in a CE order of this magnitude, and from the spec and delivery schedule Dauphin discloses the device seems likely to be going to a telco or an ISP (MSN, anybody?) rather than a cable TV outfit. Dauphin will ship 200,000 units this year, beginning in Q4, and 500,000 a year through to the beginning of 2005. This is really too sedate a rollout for a cable company, so the mystery client is surely a new entrant. The box uses ADSL/VDSL, has video on demand capability, voice/video telephony and broadband Internet access. According to Dauphin it "will connect to [an existing] gigabit fibre optic backbone infrastructure to provide ultra high speed communications services to users including; residential, commercial, civil, educational institutions, government facilities and others." There's a clue there, right? And perhaps a little slip further down: "Certain dedicated gateways will inter-connect the client's infrastructure with other telephone companies" (our italics). That doesn't conclusively prove it's a telco, but it certainly nods in that direction. So, a pending alliance between Microsoft and a European telco that's on the point of delivering ADSL, and wants to get into video on demand? BT, already a Microsoft ally in other areas, may be a candidate. Or there's France Telecom, which like Microsoft is involved with UK cable outfit NTL. It's even (slightly) possible that Microsoft is the client, given that the company is putting together an MSN broadband strategy in the US, and ought to be pushing that way in Europe too. Register bizarre historical factoid. Dauphin Technology has a rather longer and more chequered history than you might expect. Although it's a going concern now, it filed for bankruptcy back in 1995, after supply deals with the Pentagon and IBM had gone sour. Dauphin then made small, cutesy PCs, and unless our memory fails us entirely, the IBM relationship resulted in ones that ran OS/2. Funny friends Microsoft has these days. ®

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