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NBC invests in Intertainer

The network ups its Net interest by taking a 6 percent stake in Intertainer, a firm that will offer on-demand content via PCs or TVs.

NBC today made another move to increase its Internet interests, taking a 6 percent stake in Intertainer, a company that has created on-demand video entertainment and shopping services that will be available to consumers via PCs or television sets beginning this month.

The network, in conjunction with General Electric Capital, paid $3 million for the stake, according to Jonathan Taplin, cochair and co-chief executive of Intertainer. NBC could not immediately be reached for comment.

NBC also has an option exercisable in the next 18 months to buy up to 19 percent of the firm, Taplin said. An NBC executive will join Intertainer's board of directors.

NBC has been increasing its online interests lately, as broadband access and greater PC-TV convergence approach. Along with MSNBC, the network's joint Web and cable TV venture with Microsoft, NBC has invested in Web properties such as VideoSeeker, an on-demand online video service, and CNET: The Computer Network (publisher of News.com). NBC also in June took a stake in Snap, the portal developed by CNET, which was spun off and is now a joint venture between the two firms.

NBC also operates NBC Interactive Neighborhood, which is a network of local guide sites.

The moves all are in preparation for further convergence between PCs and television.

Taplin noted that Intertainer is designed to run on "any Java-enabled device over any network.

"I believe eventually, there will be all kinds of other devices [besides TV sets and PCs]--low-cost entertainment devices," he added.

Other media giants also have taken an interest in Intertainer, including Time Warner and Sony. Comcast, Intel, and US West also have invested in Intertainer, the firm said.

Intertainer will offer users e-commerce, television programming, movies, and music on demand via PCs or television sets this year. It is set to roll out later this month in Philadelphia suburb Willow Grove to customers with cable access provided by Comcast. Denver residents will be offered Intertainer via ADSL (asymmetric digital subscriber line) access through US West beginning next quarter, Taplin said.

The service includes the interface, programming, network management, and set-top technology. Users get Intertainer as their start-up interface when they sign up for access that includes the service, Taplin said.

Users can access free content such as movie previews and music videos, or they can purchase full-length movies and other programming. The user specifies the program he or she wants, buys it online, then gets a 24-hour license to view it, Taplin said, noting that with movies, for example, the service offers full VCR functionality such as fast-forwarding and rewind.

Each account user (such as individual family members within a household) gets their own password and enters their preferences. Using so-called intelligent agent technology by Firefly, Intertainer can target ads to users as well as offer suggestions for movies, television, music, and shopping options, Taplin said.

The service allows users to click through the ads they view to make purchases, he noted.

He demonstrated the product last week at the Herring on Hollywood conference in Santa Monica, California, which brought together executives from the technology and entertainment industries as well as analysts and others.

The programming NBC will provide to Intertainer viewers is still being decided upon, and is expected to be rolled out in the fall, the companies said. Taplin said the network is more likely to offer news-oriented programming in the beginning, though he expects it will also offer entertainment properties.

"The question is: How soon do we get [the entertainment-oriented shows] after they're aired?" he said.

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