Microsoft, DirecTV, RCA team for new service

Venture is ultimate bird deal

Microsoft Corp. and DirecTV have teamed up with Thomson’s RCA on a new all-in-one satellite-digital video recorder-Internet access system.

The new system, dubbed UltimateTV, will be the first satellite receiver with two tuners to allow for picture-in-picture viewing of two different live programs. It also will be the first digital video-recording system to allow the recording of one live program while watching a different live program on another channel. Its digital recorders allow users to pause and rewind live programming, and automatically record and store hours of programs.

DirecTV is already partnered with TiVo to manufacture a set-top box with a built-in TiVo recorder, which is to hit the market later this year. It also has a deal with America Online to offer a system called AOL TV later this year, with limited Internet and e-mail service, and interactive TV elements. None of the deals is exclusive.

Wedded to WebTV

UltimateTV (the name was licensed from Tribune Media Services, which had used that name for a popular Internet site until recently) will feature services and features of WebTV, which was incorporated last year into an all-in-one box from DirecTV competitor EchoStar.

“DirecTV wants to promote a variety of brands,” said DirecTV Global Digital Media president Larry Chapman. He said the launch of UltimateTV will have no effect on the launch of the TiVo box around Christmastime.

UltimateTV offers the same digital video recording and unique interactive features as the EchoStar system. But those features will be part of a single service of UltimateTV as opposed to being separate services with separate fees on EchoStar. Pricing for the UltimateTV system and the monthly service will be announced in August, with the system to be introduced by year’s end.

At 30 hours, the UltimateTV system will also have twice the storage capacity for recorded video programs as the EchoStar system, and about the same as the top-of-the-line TiVo and Replay digital video recorders.

Expansive goal

Although UltimateTV will be launched through DirecTV, Microsoft WebTV Networks president Bruce Leak said Microsoft’s goal is to launch the UltimateTV service as broadly as possible, meaning in conjunction with other satellite and cable systems.

Chapman described the deal between the three companies as a revenue-sharing relationship. But he said that while each partner has incentives to sell the systems and the subscriptions to the service, it doesn’t necessarily mean that each one will get a cut of each purchase and subscription.

Like the EchoStar system, unlimited Internet access through WebTV will require a separate monthly subscription, but limited online access to interactive components of TV programs and response via e-mail will be part of the UltimateTV service.

Leak said the moniker of UltimateTV is being emphasized over WebTV because it is a television-focused service, stressing play-along elements with shows like “Wheel of Fortune” and “Jeopardy!” and the interactive components of shows like the National Basketball Assn. playoffs.

“Satellite customers have made a conscious choice for better TV and are less interested in the online component,” Leak said. “We’re reserving the WebTV brand for the online experience.”

Chapman said the dual-tuner/picture-in-picture system and the hard-disc drive that is used for digital recording and storage will allow DirecTV to offer additional features, which will be announced later, that will not get in the way of the viewing experience.

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