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Cox cable to test ICTV's interactive services

One of cable's heavyweights will try out the company's TV software in a large, unspecified market.

Cox Communications said today it will offer interactive television from Los Gatos, Calif.-based ICTV to cable subscribers in a large, unspecified market.

The move is part of a continuing stream of trial deals as cable operators dip their toes into the pool of interactive television. Last week, Liberate Technologies said that AT&T plans to begin testing its interactive TV software on set-top boxes.

Cox is one of several cable heavyweights that have invested in ICTV. ICTV's combination of software and equipment allows Web surfing, email, shopping and other interactive services through a television and a cable set-top box.

"As an early investor in ICTV, we are pleased to expand our relationship with them," Cox senior vice president Dallas Clement said in a statement. The company is exploring several options for providing interactive television to its customers, he added.

ICTV differentiates itself from its competitors by putting most of the computing power in the central office, or the head end, of the cable network. With ICTV, the set-top box merely decodes the images sent over the cable network. Even the individual keystrokes are sent over the network to the Intel-based computers for processing.

Using this approach, ICTV asserts that it can offer better Internet compatibility--such as being able to run plug-ins--than most of the advanced set-top boxes because its computers use Intel chips. ICTV also claims it can offer a lower cost because its system can run on relatively modest cable boxes.

Unlike some other interactive TV software, ICTV's system does not alter the graphics of Web sites. ICTV senior vice president Michael Collette acknowledges that this approach means some Web pages look rather poor given the lower resolution of a television, compared with a computer. However, he anticipates portals and other Web sites will want to create TV-specific content once there is a significant market.

Collette estimates that the cost of installing a simple system, which offers email and basic interactive services such as instant access to local news and weather, costs cable companies $25 to $35 per subscriber. A more powerful system allowing for full Web surfing costs in the range of $75 to $100 per subscriber, but Collette said it should generate $20 to $30 per subscriber per month in revenue from monthly fees, advertising and e-commerce commissions.

In its statement, Cox didn't specify consumer pricing or in which market it is testing the service. Cox was not immediately available for comment.

Although this will be the first trial use of ICTV's digital system, the company has an earlier, analog version of its service running in St. Joseph, Mo. The company also did some tests several years ago with Cox in Santa Barbara, Calif.