Microsoft, WebTV Team Up on TV Chip

While best known as the sultan of software, Microsoft has teamed up with its interactive television subsidiary WebTV Networks Inc. to develop a chip -- Solo2 -- targeted for improved graphics and video display, according to a Microsoft spokesman. The chip should be available in WebTV's Ultimate TV service by November or December this year, he added.

The Solo2 chip is the result of over five years of production effort by Mountain View, California-based WebTV to come up with a way to lower the production costs of interactive television hardware, the Microsoft spokesman said. When the software titan acquired WebTV in 1998, Microsoft decided to continue investing in WebTV's chip project. Solo2 is the third generation of WebTV's chip efforts and is being manufactured by Toshiba Corp. in Japan.

Solo2 is intended to increase the rendering abilities of memory-intensive graphics and video applications, the Microsoft spokesman said. Previous versions of the chip didn't support the same number of outputs, he added. Users should now be able to watch or record up to two different TV programs while simultaneously surfing the Web.

Devices similar in functionality to Solo2 currently cost around $US20, according to Microsoft and WebTV. Solo2, however, can be manufactured for less than $US10 per chip, they claimed. The low price-tag might interest other manufacturers in the interactive media device market. With this in mind, deals may be reached with other manufacturers in need of video- or graphics-related capabilities.

Microsoft's involvement in chip making comes as a bit of surprise given the vendor's extensive relationship with chip giant Intel Corp. If Intel executives were disturbed by the news, however, they managed to hide it at the Intel Developer Forum (IDF) this week in San Jose, California.

"I think Intel's reputation as a chip company is a little more understood than Microsoft's," said a confident Ron Smith, vice president of Intel's wireless communications and computing group, when asked at IDF about Microsoft's plans.

"I'm glad to compete with Microsoft if that's the case. I would welcome the competition," echoed Mark Christensen, vice president of Intel's network communications group.

Microsoft has made a slew of recent announcement confirming that the vendor intends to shift gears well beyond software. Earlier this month, the company showcased a prototype of a wireless phone that takes on many of the functions of its Pocket PC handheld device specification. The phone codenamed "Stinger" will have a Web browser and various applications such as e-mail, calendar and contact list functions.

Solo2 might have a role in other Microsoft endeavors beyond its software core market as the vendor intensifies its focus on the Internet applications market, the company's spokesman said.

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