Microsoft, TCI plan cable net

Tele-Communications Inc. topper John Malone and his new best buddy, Microsoft chairman and CEO Bill Gates, are teaming up to launch a new basic cable network focusing on personal computers.

The venture is separate from last week’s news that TCI and Microsoft would partner on an interactive TV test starting in the fourth quarter of this year.

The new network — set to launch in 12 to 18 months — will focus on personal computing through magazine format shows and home shopping. Microsoft and TCI will be equal partners in the venture, with TCI delivering the network to cable systems via digital compression and set-top devices. However, cable operators that have not digitally upgraded their systems by the network’s launch will be able to carry the network over their current analog systems.

TCI’s continuing partnership with Microsoft is indicative of the cable giant’s corporate strategy in light of its failed merger with Bell Atlantic. TCI has told investors it will look to joint ventures such as the one with Microsoft and minority investments in programmers and telephone companies.

The TCI-Microsoft venture will compete with Jones Intercable Inc., the nation’s seventh-largest operator, which has its own network geared to PC users. Jones Computer Network (JCN) is set to launch as a full-time service in the third quarter of ’94. Currently, JCN is a nightly four-hour programming block on a Jones cable channel.

Keeping an eye on the growing relationship between Malone and Gates is Capitol Hill. House telecommunications subcommittee chairman Ed Markey (D-Mass.) warned last week that the TCI-Microsoft interactive TV partnership could raise problems for both consumers and competitors.

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