CHICAGO -Microsoft Chairman and CEO Bill Gates, kicking off a cable industry show here Monday, said the long-awaited day is coming when cable operators will offer telephone service using the digital technology that delivers video and e-mail.
“The cable industry will find itself in telephony in a big way,” Gates said. “Communications will become a big leg of what supports the ongoing investment” by cable companies in their digital networks.
“It will be instant messaging on steroids,” he said.
Gates’ remarks were part of a wide-ranging panel discussion with top executives of leading cable and entertainment companies to open the annual convention of the National Cable & Telecommunications Association.
The show, expected to draw more than 15,000, runs through Wednesday and showcases high-definition television, an emerging technology the industry is hoping will ignite sales.
Appearing with Gates were Viacom President and Chief Operating Officer Mel Karmazin, AOL Time Warner CEO and Chairman-Elect Richard Parsons and Comcast Corp. President and CEO Brian Roberts.
Moderator Lou Dobbs, anchor of CNN’s “Moneyline,” asked the four whether they consider one another partners or competitors.
“It’s a little bit like regime change,” Parsons said. “I think of these guys more as partners.”
AOL, one of Microsoft’s most bitter adversaries, last month reached a $750 million settlement to AOL’s antitrust suit. The companies agreed to collaborate on ways to distribute movies and music using Internet technology while solving the industry’s piracy problems.
“We could actually all be losers if we don’t solve this security problem,” Roberts said Monday.
He said 65 percent of Comcast’s digital cable-television customers in Philadelphia have tried video-on-demand services.
Microsoft introduced a new software designed to run on digital cable-TV boxes to help cable operators promote video-on-demand and other services. Called Microsoft TV Foundation Edition, it includes an interactive program guide that’s by used cable operators in Oregon.
Comcast, the country’s biggest cable operator, said Monday it plans to try out the new software.
Microsoft has a stake in Comcast from its investment in AT&T Broadband, which Comcast acquired.
Karmazin said he views Comcast and others as “more like partners, but I do look over my shoulder.”
Broadband isn’t the only way to distribute movies, he added.
“The other method we have for distributing content is called Blockbuster,” he said, plugging Viacom’s retail chain.
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