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GI set-tops to support Visa's smart cards

The cable-TV boxes will allow an array of interactive services that users can pay for using Visa's digital smart cards.

Cable-TV equipment manufacturer General Instrument will support smart cards in a souped-up version of its digital set-top box due to ship by mid-1999, including the ability to download and spend Visa Cash.

But so far, GI doesn't take American Express--or Mastercard either.

General Instrument said its digital interactive set-tops will support Visa's smart-card scheme, enabling not only Visa digital cash but also other functions. Smart cards look like standard credit cards but have an embedded chip that makes them more versatile.

The announcement means that at some future date, consumers could use new interactive services from their TV and go shopping, spending money from the smart card rather than a credit card. Other future home uses include electronic coupons, home banking, loyalty programs that reward frequent users, or pay-per-view video using Visa Cash.

"There is a lot of interest in how to leverage [digital cable networks] for electronic commerce and couponing," said Denton Kanouff, General Instrument's vice president of marketing for digital products.

But additional uses would require other companies to create software that works on Visa's smart-card platform.

To date, no single operating system dominates the smart-card industry, meaning that companies must adapt their smart-card applications for each scheme. Visa is pushing its Visa Open Platform, while MasterCard is in the Mondex camp.

Kanouff said his company has been in discussions with Mondex and several major banks and is likely to support other smart-card schemes too.

The new DCT 5000 Plus set-top will come with a built-in cable modem, a high-end microprocessor and 3-D graphics. And it can be used simultaneously to watch TV, surf the Net, and place an Internet protocol phone call over the Internet.

That model, and some 2 million less sophisticated digital set-tops GI has already shipped to cable operators, work on cable systems that use GI's infrastructure, but not on competing manufacturers' equipment. To date, GI digital systems pass 29 million households in the U.S.

The new high-end digital set-top will be priced around $400 to cable operators, who typically lease themto subscribers. The lower-end set-tops, which will continue to be deployed and don't have a smart-card slot, run around $300. GI will test retail distribution next year, Kanouff said.

A year ago, GI announced a set-top deal with 12 cable operators that agreed to buy 15 million digital set-tops, including both high- and low-end models.

Additional smart-card applications to run on the new devices will be marketed by Visa and the individual cable operators, although interested companies can participate in GI's application-developer program.

The General Instrument agreement adds another device that can accept Visa smart cards and digital cash. Last month, a European standards group, the European Telecommunications Standards Institute, agreed to use Visa's platform for smart cards used with GSM mobile phones.

"We are delighted that support for the Visa Open Platform across different industry sectors continues to grow," Visa's Philip Yen, senior vice president of emerging products, said in a statement.