U.K. cablers team for set-top box deal

LONDON — The three biggest U.K. cable operators have struck a deal with U.S. technology giant General Instrument for the supply of digital set-top boxes, with a substantial order to be placed in as little as three weeks’ time. It is an important step for the cable industry in that it bypasses the need to use British Sky Broadcasting’s planned digital box.

The move by Telewest, Nynex and Bell Cablemedia is also significant in that it marks the first time that the three have collaborated since Nynex, Bell Cablemedia and another operator, Videotron, announced they are merging with Mercury Communications to form Cable & Wireless Communications, the company that will supplant Telewest as the U.K.’s largest cable operator.

Key clout

A united digital front could give the cable industry more clout in dealing with BSkyB, which has been dominant due to the fact that the satcaster supplies cable with the bulk of its key TV programming.

A cable industry source said that the order would involve an initial “tens of thousands” of boxes and that the accompanying digital service will launch in the fourth quarter of this year. On offer will be an expanded range of TV channels, near video-on-demand, pay-per-view and an Internet link.

Free boxes

At least Telewest intends to offer the boxes within its monthly subscription fee. Many observers think BSkyB intends to sell its boxes for about $300.

General Instrument will also supply transmission equipment to the cable operators, but the operators will run the technology. The cable industry will announce other set-top box suppliers later in the year.

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