Delay Threatens Set-Top Win

United Pan-Europe Communications (UPC), Europe’s largest cable operator, has publicized delays in Microsoft’s TV software and has chosen Microsoft competitor Liberate for a trial of interactive TV services. The moves are a setback but are not fatal for Microsoft’s multibillion-dollar campaign to promote broadband Internet access and sell software for interactive TV services.

UPC is one of a set of cable companies worldwide (including AT&T in the United States, NTL in the United Kingdom, Rogers in Canada, and TV Cabo in Portugal) that have received significant investments from Microsoft and are evaluating the Microsoft TV Advanced software. This software enables a cable operator to deliver interactive television (which integrates Web content into television programs) as well as Internet services such as e-mail, chat, and Web browsing. A component that runs on the set-top box attached to a user’s television communicates with Windows 2000 servers at the cable operator’s “head end.” (See “Microsoft’s TV Platform Targets Markets Beyond Interactive TV” on page 18 of the July 2000 Update.)