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Inergy, Philips in WebTV deal

Inergy Online signs a licensing deal with consumer electronics giant Philips to offer its email and Web site-building applications with Philips' WebTV set-top boxes.

Software developer Inergy Online has signed a licensing deal with consumer electronics giant Philips to offer its email and Web site-building applications with Philips' WebTV set-top boxes, Inergy CEO Frohman Anderson told CNET's NEWS.COM today. More details will be released later, but Anderson said the deal covers "a number of products in the Philips organization" beyond WebTV.

Cambridge, Massachusetts-based Inergy offers a Web site authoring tool called Web Site for TV and an email service called Email America, both of which run on a server and are customized to display on TV screens. Last month the company quietly struck a deal with Sony, the other WebTV hardware manufacturer, to offer those same products to its WebTV customers.

Inergy's applications reside on a central server, as do the user's files. With approximately 500 users of its products, the company runs its own server farm at the moment, but the data and application storage is being outsourced to GTE starting next week.

By early next year Inergy hopes to offer a word processor, a calendar, and a rudimentary personal finance application, Anderson said.

Philips plans to focus on selling to the educational and library institutional market, the company told CNET's NEWS.COM in an earlier interview. As a result of that strategy, the Inergy-Philips deal is not a surprise, as Philips has been planning to offer a word processor, Web page development tools, and other applications to customers in these markets.

Currently, users cannot register for Inergy's products directly; they must sign up through the company's partners, which could include Internet service providers in the coming months, although no deals have been struck, Anderson said.

Elsewhere in the Internet-on-TV market, RCA's Internet set-top box uses software from Oracle affiliate NCI but can't currently run word processing or other applications. NCI does have Java-based productivity applications and an arrangement with a German company to provide a server-based application suite, but neither RCA nor NCI have talked about when RCA customers will have access to programs over the Web.

Inergy may be in a good position to take advantage the market for next-generation cable set-top boxes.

Set-top boxes issued today by cable companies typically allow subscribers to view numerous channels and pay-per-view programming, but not much else. Cable companies are preparing set-top boxes that will make the TV more like a computer.

The new generation of digital set-top boxes will allow cable companies to offer Internet access through the television as well as a host of other activities such as online gaming. Using technology such as Inergy's, programs that have been traditionally offered only on PCs will be available in households that weren't interested in PCs.

Such a scenario poses a threat to Microsoft's dominance in software applications, a large reason behind Microsoft's purchase of WebTV Networks. The company wants to make sure its Windows CE operating system--a lightweight version of Windows--gets inside digital set-top boxes.