Microsoft goes back-to-basics on cable TV

Microsoft Corp is going back to basics to revive its failing interactive TV (iTV) strategy, with an entry-level set-top-box operating system built using its latest programming language, C Sharp,

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Redmond, Washington-based Microsoft next week plans to launch a version of its Windows CE-based operating system for Motorola Inc's low-end DCT 2000 iTV unit. So far, Microsoft has targeted Motorola's fuller featured DCT 5000 unit.

An indusry source told Computerwire Microsoft's new operating system will be built using C Sharp, the Java-like programming language launched in February under its .NET strategy.

A Microsoft spokesperson refused to comment on what it called "rumor and speculation" but conceded an iTV announcement is planned for 6 May. The announcement will take place during the cable TV industry's Cable 2002 in New Orleans, Louisiana.

A low-end operating system is a major re-assessment of Microsoft's iTV strategy. The company has targeted development on Schaumberg, Illinois-based Motorola's DCT 5000. That unit is capable of e-commerce, streaming media, e-mail, telephony, home networking, internet browsing and video on demand. Motorola's DCT 2000 is less featured but more popular, according to Motorola, and favored by many cable operators.

Microsoft's developments have been plagued by problems. The company cited difficulty in optimizing its software to the hardware although changing demands and uncertainty over which features to include is also thought to have played a part.

The result is a string of delayed rollouts with cable companies worldwide. These include a contract for 30,000 devices with Europe's largest cable provider United Pan-Europe Communications BV (UPC), 7.5 million boxes and an optional 2.5 million devices with AT&T, and a contract with Charter Communications Inc - America's fourth largest cable TV provider - delayed by at least six months in March.

Microsoft lists 10 customers worldwide for its set-top-box software and services. So far, it has achieved deployment for just three - TAK SAS in France, TV Cabo in Portugal and UltimateTV/DirecTV Inc in the US on Thompson, Octal and Sony set-top-boxes respectively. A spokesperson said it does not release subscriber numbers.

A new low-end operating system could potentially revive Microsoft's fortunes. However, the company must cover much lost ground in its battle against rivals like San Carlos, California-based Liberate Technologies Inc. David Limp, Liberate chief strategy officer, said: "[Microsoft] is putting their thumb in the dyke for now."

© ComputerWire.