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PowerTV Adds Prasara to Software Suite

The trend of consolidation continued in the interactive-TV-software sector as PowerTV Inc. announced plans to merge with Prasara Technologies Inc.

The deal, for which financial terms were not disclosed, follows Liberate Technologies'recent purchase of MoreCom Inc. and OpenTV Inc.'s buyout of Spyglass Inc.

By bringing Prasara under its wing, PowerTV adds key video-on-demand, television-commerce (t-commerce) and back-office applications to its portfolio.

While less sexy than its interactive-interface software, Prasara's suite of customer-care and back-office applications will serve to differentiate PowerTV's lineup against those of its competitors, CEO Steve Necessary said.

Prasara's back-office apps include customer-access and ad-management systems; legacy-billing and propagation-manager programs; and content management, marketing- transactions analysis, order management and provider- account-management systems.

PowerTV's move, Necessary said, reinforces the Scientific- Atlanta Inc. subsidiary's focus of providing an "end-to-end" software infrastructure for digital-TV applications.

Necessary said Prasara's VOD client, its customer-care and education software (including a digital set-top-box tutorial) and its t-commerce system are complementary to PowerTV's set-top operating system and suite of e-mail, Web browsing, news and chat.

Prasara was formed in 1997 in the aftermath of Time Warner Cable's Full Service Network experiment in Orlando, Fla.

"The vision of this company is to create applications and business-management tools that are open," and that can operate on any video server, set-top box or network, president Robert Montgomery said.

Time Warner Cable is using Prasara's customer-care and commerce applications in Honolulu, the Tampa Bay area of Florida and Manhattan.

PowerTV's software is deployed on more than 1.6 million S-A set-tops. Despite the Time Warner/S-A focus of its deployments, Montgomery said, the company's software is ported to Pioneer New Media Technologies Inc.'s "Voyager" and Motorola Broadband Communications Sector's platforms, and he is in discussions with several unnamed MSOs about the use of Prasara software.

Last month, VOD-hardware vendor nCUBE announced an agreement with Prasara to market their products jointly. "Prasara is an extremely important partner," nCUBE director of product management Jay Schiller said. "We like the Prasara solution, and our customers like the Prasara solution."

Other customers for Prasara's VOD interfaces include Concurrent Computer Corp., Unisys Corp., Starz Encore Media Group LLC and Home Box Office.

Montgomery said Prasara is building Starz Encore's subscriber-VOD interface, noting that Prasara designed a

TV-banking application for Time Warner's Honolulu system, which was a popular feature in Orlando.

Perhaps the sexiest application Prasara brings to the table is its t-commerce interface, which Montgomery said allows an operator to bring merchants interactive-TV sales tools. In Honolulu, Time Warner's Oceanic Cable system has partnered with Pizza Hut to offer "pizza on-demand." Montgomery called Prasara's approach a hybrid of QVC-style home shopping and Internet e-commerce.

But just as important is provisioning digital services, and Prasara brings a full portfolio of back-office and support applications to the PowerTV stable.

Prasara's customer-access-management system allows operators to establish a database of subscriber information that can link with a billing system and maintain transactional records. The content-management system tracks the status of such VOD assets as movie titles, and can activate and deactivate assets stored on a server.

With Prasara's marketing-transaction system, operators can track advertising, subscriber navigation and application usage. The company's provider- account-management system collects information about content providers and commerce partners, with the ability to generate royalty or commission affidavits.

Another Prasara technology, its application engine, was built for so-called thin clients, or low-powered computers and set-tops running off networks. In VOD applications, the engine is downloaded to the set-top, and it keeps all applications in sync with content changes at the headend.

Prasara will become a subsidiary of PowerTV, but will retain its name and offices in Orlando. The company is privately held, and Montgomery wouldn't reveal revenue figures, although he said it has been profitable in its two-and-one-half years of operation.

Prasara collects license and maintenance fees, and it can take stakes in commerce revenues, just as in traditional retail-transactional arrangements. Such stakes vary from market to market.

As for speculation that PowerTV will spin off from S-A later this year and sell stock

to the public, Necessary said only, "PowerTV and Scientific-Atlanta are considering strategic transactions involving PowerTV."