Gemstar-TV Guide and Thomson are expected to sign agreement in coming weeks that will expand 3-year-old @TV joint venture to integrate former’s interactive program guide (IPG) in broader range of products and include it in 2-way interactive services, Gemstar CEO Henry Yuen told analysts in earnings conference call late Wed. Companies formed @TV in late 1999 as terms for Gemstar’s IPG were extended to 2010, with Thomson pledging to incorporate it in 30 million TV devices in N. America through contract period, including 19” and up TVs and all digital sets. Thomson had integrated Gemstar’s Guide Plus Gold IPG in 6.5 million sets as of Dec. 31, accounting for majority of 7 million CE products containing technology. Zenith also has deployed Guide Plus in its sets.
NTL Inc. said company, steering committee of its lending banks and unofficial committee of its public bondholders had reached agreement on implementing recapitalization plan announced last month (CD April 17 p7). Under plan, $10.6 billion in debt would be converted to equity of 2 new companies -- NTL U.K. and Ireland, which would hold its main assets in U.K. and Ireland, and NTL Euroco, holding most of its assets on Continent. Plan contemplates receiving $500 million from some members of unofficial committee of bondholders for NTL’s operations in U.K. and Ireland. Separately, steering committee for banking syndicate for Cablecom, NTL’s Swiss cable subsidiary, implemented plan for continued funding of Cablecom. Next step, company said, was for it and certain of its U.S. and U.K. holding companies that had issued publicly traded bonds to file prearranged Chapter 11 bankruptcy cases under U.S. law. Company said that filings were expected May 6 and that none of NTL’s operating companies would be affected.
EchoStar said first-quarter loss narrowed to $38.6 million from $169.8 million year earlier as it posted better- than-expected gain in subscribers. Revenue increased to $1.1 billion from $861.9 million. EchoStar added 335,000 net new subscribers in quarter, surpassing analysts’ estimates of 313,000, but down from 460,000 additions year ago. It ended quarter with 7.1 million subscribers, is targeting 8 million by year-end.
EchoStar said first-quarter loss narrowed to $38.6 million from $169.8 million year earlier as it posted better-than- expected gain in subscribers. Revenue increased to $1.1 billion from $861.9 million. EchoStar added 335,000 net new subscribers in quarter, surpassing analysts’ estimates of 313,000, but down from 460,000 additions year ago. It ended quarter with 7.1 million subscribers, is targeting 8 million by year-end.
No comment was available from Midway Games at our Wed. deadline on its victory in Conn. case that found Chicago game maker defending itself against mother of 13-year-old boy Noah Wilson who was stabbed to death 4-1/2 years ago by playmate. Mother claimed young killer had been addicted to playing Midway’s Mortal Kombat and company wasn’t entitled to First Amendment protection because its ad campaign for game violated unfair trade practice law by targeting children. Mother -- Andrea Wilson -- was seeking damages for loss of parental consortium and emotional distress, Connecticut Law Tribune reported. Report said “in 34 pages touching on Shakespeare, Marshall McLuhan, the Columbine massacre and a flawed guide to poison mushrooms, [U.S. Dist. Judge Janet] Arterton held the videogame is not a ‘product’ and is shielded by the First Amendment.” New Haven judge predicted that if Conn. Supreme Court were to rule, it would not allow parents consortium damages from death of child. Wilson was represented by Hartford lawyer Joseph Moniz, whose case was dismissed on all counts. Report said that in Midway’s motion to dismiss, it contended state products liability act “cannot be contorted to include ideas or expression” in definition of “product.” Wilson’s unfair trade practices claim was filed in court within 3 years, but papers were served on Midway later, barring recovery under applicable state rules, report said. Victory came none too soon for Midway, which is gearing up to release its first Mortal Kombat title -- Deadly Alliance -- for next-generation game consoles this fall.
Saying copyright was under attack, Register of Copyrights Marybeth Peters last week urged copyright community to make its voice heard in case set for review by Supreme Court. Peters’s comments came at American Intellectual Property Law Assn. spring meeting in N.Y.C. Implementing Digital Millennium Copyright Act (DMCA), which was enacted to bring the U.S. into line with World Intellectual Property Organization treaties, gets more controversial, Peters said, spurred in part by furor over law’s anticircumvention provisions. Copyright Office thought situation was bad several years ago, she said, but it “got worse” as Internet shifted public perceptions toward viewing content owners as greedy corporations and copyright itself as suspect, she said.
Two weeks after receiving 15-day extension from SEC to file its annual 10-K report, Adelphia said it wouldn’t meet new deadline (CD April 2 p2), which was end of day Tues. Company said it still was working with its auditor, Deloitte & Touche, to review how it treated its co-borrowing agreements for accounting purposes. Adelphia said it would file its 10-K “as soon as practicable.” Company disclosed earlier in conference call with analysts that certain subsidiaries of Adelphia were parties to co-borrowing agreements with several business entities that were owned by Rigas family, which founded Adelphia. Company officials said co-borrowing arrangements totaled $2.3 billion, but analysts now say those pacts could put Adelphia on hook for $2.7 billion or more. Adelphia said Tues. it didn’t believe its review would result in other material changes in its 4th quarter or full-year results for 2001, as reported March 27. However, company said that “in light of the review process,” it intended to re-evaluate its previous guidance for 2002.
After “sleepless night,” CEA Pres. Gary Shapiro said he would begin meeting with CEA members on possibility of compromise on FCC Chmn. Powell’s DTV plan. CEA had indicated DTV tuner portion of plan would be unacceptable because of cost of adding tuners to low-priced TVs. However, Shapiro, in Mon. keynote at MSTV meeting during NAB convention in Las Vegas, indicated CEA was caught partly by surprise by Powell announcement and might have to “modify our initial reaction a bit.” Shapiro wouldn’t discuss possible shape of compromise, saying only that he would discuss issue with members and “see what we can do.” He told us later some members might find including tuner easier than others: “There is some room for discussion.” There were other indications at convention that CEA might seek stronger commitment on cable compatibility issues in return for agreeing to some version of tuner plan, although timing of tuner adoption also remained issue. -- MF
Mich. PSC reinstated majority of counts in CLEC complaint alleging SBC/Ameritech had engaged in anticompetitive practices relating to its Centrex, voice mail and DSL services. Complaint (Case U-13193), filed jointly by 4 CLECs and 2 CLEC trade groups, had been dismissed by administrative law judge Jan. 22 but CLEC interests appealed to PSC, which reinstated counts alleging: (1) Ameritech’s early-termination penalties in Centrex contracts were unreasonable and anticompetitive. (2) Ameritech, through its DSL affiliate, improperly terminated DSL service when customer switched to CLEC service. (3) Ameritech refused to allow voice mail to be part of unbundled network element (UNE) platforms or to sell stutter dial tone as UNE. (4) Ameritech was using its monopoly power to impede competitive DSL deployment. (5) Ameritech wasn’t making DSL available for resale. Reinstated counts were remanded to ALJ with instructions to set case for hearing. PSC upheld dismissal of 3 other counts relating to wholesale pricing and digital loop carrier access, saying those issues were addressed in other proceedings
While many retailers have slowed expansion as they wait out sluggish U.S. economy, regional retailers Ultimate Electronics and H.H. Gregg are pushing ahead on wave of interest in digital products. Ultimate filed last week to sell 2.7 million shares in effort to raise more than $70 million, while Gregg said it planned to open 11 stores in Atlanta area in 2003.