IBM, ICTV to Join in Interactive Home Video System

SOMERS, N.Y. and LOS GATOS, Calif., November 15, 1994 . . . IBM and ICTV
today announced a wide-ranging agreement that includes IBM acquiring an
equity interest in ICTV, joint development and worldwide marketing, and
IBM manufacturing ICTV hardware.

Together, the two companies intend to provide video-on-demand and
interactive services technology and solutions to cable operators and telco
providers.

IBM and ICTV are already working together in a trial with Cox Cable
Communications to bring interactive television services into homes in
Omaha, Nebraska. Cox is also an equity investor in ICTV. Services to be
tested in Omaha include movies-on-demand, music videos-on-demand,
games-on-demand, interactive shopping, and education informational
services.

In the trial, IBM is providing network communications equipment, including
software, as well as video servers. Products include 3172 interconnect
controllers, RISC System/6000* computers, and NetView* for AIX* network
management software.

ICTV will provide the interactive television hardware and software
infrastructure for the head-end that allows programming to be delivered
into the home. This system can instantly and seamlessly switch a TV viewer
from ordinary broadcast programming to various interactive services.

ICTV, a privately-held, five-year-old company, has developed technology and
products that allow for existing broadband cable systems and future
telephone systems to deliver advanced, interactive television services.
ICTV's approach is to concentrate its technology at the head-end with an
intelligent interactive TV processing hub. By doing so, the operator can
use the existing low-cost, analog set-top boxes. The ICTV technology will
work with more advanced digital set-top boxes, as well, so it gives
operators flexibility to determine when to make the transition from analog
to digital set-top boxes.

"Soon, homes in the Omaha area will have access to interactive television
and other services that are made possible by high-bandwidth capabilities,"
said Bob Steen, director of multimedia networking, IBM.

"IBM is well positioned to pave the way for delivering high-speed networks
including ATM (Asynchronous Transfer Mode) using the Nways broadband
switches. ATM is a technology particularly well suited for moving voice,
data and video information at extremely fast speeds," added Steen.

"This partnership creates a perfect marriage of resources and expertise,"
said William F.X. Grubb, ICTV's chief executive officer. "ICTV's unique
bandwidth management solution to provide interactive services today meshes
with IBM's long history of providing sound answers to technological
problems. We look forward to providing trial interactive services to Cox
subscribers in Omaha."

ICTV, based in Los Gatos, California, has developed and is now marketing a
comprehensive, patented technology and architecture which enables true
interactive television on existing cable television systems.

IBM, based in Armonk, N.Y., is the leading worldwide supplier of technology
solutions.

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