Gates: Now he's after your TV

At a US television industry trade show, Bill Gates outlined his company's new approach to interactive TV software.

The Microsoft chairman, speaking at the opening session of the National Cable & Telecommunications Association's annual trade show, announced a new software for bridging cable television and interactive digital technology.

Microsoft TV Foundation Edition, for use by cable operators with their existing hardware and network systems, is designed to offer cable TV viewers features such as video on demand and advanced parental screening.

Gates gave his remarks at a show panel on Monday morning, along with executives from several other cable and internet companies including Viacom, AOL Time Warner and Comcast.

The panel, entitled 'Leading the Digital Revolution', was devoted to "the business opportunities and challenges in transition to digital television, as well as the relationship among the various marketplace segments that are bringing consumers benefits of the broadband digital platform deployed by the cable industry".

To what degree Microsoft is bringing benefits to cable consumers in any substantial numbers is a matter of debate in the cable industry.

Microsoft this year switched off its investment in the UK's Telewest Communications, selling its 23 per cent stake for $5m (down from a 2000 stock exchange valuation of $2.6bn). That divestment joins others in revealing a general lack of growth in the cable industry.

To counter the impression that the industry is bypassing Microsoft in its march toward interactive digital capacity, the software giant on Monday released a list of companies that have pledged support for TV Foundation: Advanced Digital Broadcast, Concurrent Computer, MetaTV, Motorola, SeaChange and Two Way TV.

Lydia Loizides, a senior analyst at Jupiter Research said Microsoft's new offering marks a substantial - and positive - change from how the company had approached cable in the past. The new approach is crucial, she said, in gaining traction in a lukewarm market.

Loizides said: "This marks a fundamental shift in the way they've been looking at the market. In the US, they haven't had a lot of success... but now they appear very focused, very methodical, thinking in terms of how they can actually fix problems today.

"Let's face it interactive television middleware has not been a place of massively robust growth. But that's because the focus was on the nice-to-haves. And now it's on the need-to-haves."

Paul Festa writes for News.com