Rogers and Microsoft Partner to Bring Two-Way Television to Canada

Strategic Insights -

Rogers Communications Inc. and Microsoft Corp. have announced a joint effort to bring two-way television, also known as interactive television, to Canadian homes by 1996. The partnership will see Rogers use Microsoft's "Tiger" continuous media-server software, which will enable the company to provide Canadians with interactive television services, including video-on-demand and home banking. The deal signals Rogers' intention to develop a computer user clientele and its vision of the future, where the home will have two interactive devices: the television set for entertainment and the personal computer for transactional services.

Key Takeaways:

  • Rogers Communications Inc. and Microsoft Corp. have partnered to bring two-way television to Canada, with plans to launch the service starting some time in 1996.
  • The partnership will see Rogers use Microsoft's "Tiger" continuous media-server software to provide Canadians with interactive television services, including video-on-demand and home banking.
  • Rogers expects to take delivery of Microsoft's "Tiger" software next summer and will first develop learning applications for educational institutions before bringing the service to residential customers.
  • The company's vision is that the home will have two interactive devices: the television set for entertainment and the personal computer for transactional services.
  • Rogers has partnered with Microsoft on developing new software, with the two companies dispatching a handful of top engineers to work on the project in Redmond, Washington.
  • Microsoft is investing $100-million (U.S.) in its "Tiger" software this year, with the goal of keeping its name high in the major (software) categories.
  • The partnership has been met with skepticism by some, with critics pointing out that companies such as Oracle Corp. and Microware Systems Corp. have already developed software for video-on-demand.
  • However, others have taken a more positive view, with Robert Alexander, an interactive network consultant at Alexander & Associates, stating that the Rogers system is more modern than many of those in the United States.

Statistics:

  • Microsoft is investing $100-million (U.S.) in its "Tiger" software this year.
  • Rogers is expecting to take delivery of Microsoft's "Tiger" software next summer.
  • The company plans to first develop learning applications for educational institutions before bringing the service to residential customers.
  • The rate of penetration of computers in Canadian homes is forecast to quickly reach 70 per cent.
  • Rogers is spending little cash on the project, with the company investing what has been called "sweat equity" - dispatching a handful of its top engineers to work on the project.

Sources:

  • Rogers Communications Inc.
  • Microsoft Corp.
  • The Globe and Mail
  • The Wall Street Journal