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Be gets funding help from friends

Be Incorporated raises more than $25 million in 1998 to fund market expansion, with a little help from Intel.

    Be Incorporated, a maker of operating system software, announced it has raised in excess of $25 million in 1998 to fund market expansion, with some of that money coming from Intel.

    In tandem with its operating system rollout at Comdex today, Be said chip giant Intel has taken an equity stake in the company, along with a number of venture capital firms, as previously reported.

    As the company basks in its afterglow of Intel's investment, Hitachi will announce that it will begin to bundle the BeOS as a standard feature in some of its new desktops. To date, no major manufacturer has included Be's software as a standard feature.

    The series of announcements will likely serve to bring the Menlo Park, California-based software vendor back into the limelight. The company, which was founded by former Apple Computer executive Jean-Louis Gassee, has received high marks for its software but has not enjoyed significant commercial success.

    In 1996, Apple was in negotiations to buy the company, but then backed out, reportedly because Be upped its asking price. Be executives see the investment as a validation of their strategy to serve a niche market for PC operating systems.

    "Our success with this round of funding indicates that there is room in the market for alternative operating systems that address very specific end-user needs" said Gass?e, chairman and chief executive officer of Be in a statement. "Just as Linux is the alternative OS for Internet and enterprise servers, the BeOS aims to do the same for audio and video creation and playback."

    The Be investment will also mark the second investment in an operating system company this year for Intel. In September, the company took an equity stake in Red Hat Software, which markets a version of the Linux operating system.

    Be and Intel have been linked for some time. Be, for instance, held a product demonstration at the Intel Developer Forum in September. Intel has said previously that Be has also received marketing funds and technical assistance from the chip giant.

    Be would not disclose the size of the Intel investment. The venture capital firms that announced investments in Be include August Capital and Alta Partners.

    The new version of the BeOS, introduced today at Comdex, allows users to access data stored in Windows files, and synchronize BeOs keyboard shortcuts with Windows shortcuts.

    BeOS Release 4 works with any Intel or PowerPC-based PC with at least 16MB of memory, a 150MB hard drive, and CD-ROM drive, the company said. In addition to increased Windows functionality, Release 4 also features a Media Kit to ease the burden of working with streaming video and audio, expanded support for audio, video, and networking hardware, and increased system performance.

    Also, BeOS 4J, a separate Japanese version available with Release 4, allows users to input Japanese characters into the OS.

    BeOS Version 4 will be available next month for an introductory price of $69.95 when purchased online. The retail price is $99.95.

    Intel is an investor in CNET: The Computer Network, publisher of News.com.