With the deal, NCI's software will be used by the three largest major cable service providers in the U.K. NCI hopes the deals will give it a leg up on competitors such as Microsoft and OpenTV in the race to provide software for interactive television services.
Telewest licensed NCI's TV Navigator for DTV and Connect Server to enable services such as email, electronic programming guides, home shopping and news, and the ability to view television and Internet content at the same time. Terms of the agreement weren't disclosed.
After years spent on mergers and building networks, the United Kingdom's three biggest cable companies are preparing to woo customers with digital TV services that offer Internet access and other interactive services. CWC plans to roll out services with NCI's software later this year; Telewest is expected to start its rollout late in 1999, but the rollout is expected to occur over an 18 month period. NTL has already deployed the software in its one-way cable network.
"This really caps the triumvirate of U.K. cable companies. It's incredibly important [because] a lot of U.S. cable companies are looking to the U.K. to see what's going to work," said Charlie Tritschler, NCI's vice president of marketing. Analysts say the deal shows the U.K. is turning into a testing ground for interactive services via television.
International Data Corporation analyst Sean Kaldor said cable companies are more aggressively deploying new services in Britain in part because consumers are already used to a rudimentary form of interactivity on their stations already in the form of teletext service.
"To see so many suppliers adopting [interactive services] puts the U.K. ahead of any other country in world," Kaldor said.
The deal appears to put NCI ahead of Microsoft's WebTV unit in terms of getting cable companies to use its software. Recently, questions have arisen about NTL's commitment to use NCI software because Microsoft invested $500 million in the cable operator.
The two companies said they were "working jointly to develop new, broadband services," although Kaldor speculated that the deal related more to the use of Microsoft's server software for billing and other administrative functions.