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Paul Allen stakes ZDTV

The Microsoft cofounder invests $54 million in tech publisher Ziff-Davis's 24-hour cable channel.

Computer news publisher Ziff-Davis today announced that billionaire investor Paul Allen's Vulcan Ventures will make a $54 million strategic investment in ZDTV, a 24-hour cable channel devoted to Internet and related technologies.

The investment will give Vulcan Ventures a one-third stake in ZDTV. Vulcan Ventures was founded by Microsoft cofounder Allen in 1986 to research and implement his investments. Allen's investments through Vulcan Ventures are long term, with goals that enable him to take above-average risks with a long-term view. Through Vulcan Ventures, Allen invests in companies that offer products, services, or technologies that fit his "Wired World" strategy, and can contribute to or benefit from the technology and strategy of other Paul Allen companies.

"Paul Allen's investment is tremendous for ZDTV," ZDTV president and chief executive Larry Wangberg said in a statement. "With analysts forecasting 122 million Internet users and 1.3 million commercial Web sites in the United States by 2001, there is a huge marketplace for this programming.

"We believe ZDTV is in a very strong position to participate in this growth," added Wangberg.

About 9 million homes have access to ZDTV through agreements with 20 cable television affiliates, including Tele-Communications Incorporated and Comcast. ZDTV has a lineup of 12 original shows about technology and the Internet, all of which are produced at its San Francisco studios.

Shares of Ziff-Davis surged 6.34 percent to 9.47 on the news. The stock has traded as high as 19 and as low as 3.63 during the past 52 weeks.

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