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Cable Operators

Channel-Surfing Moves in a New Direction

3/13/2005 7:00 PM Eastern

Hillcrest Communications — the software company that secured the services of former Comcast Corp. executive Andy Addis — is showing its new, nonlinear navigational application for video content off to cable companies.

Rockville, Md.-based Hillcrest aims to tackle the increasingly vexing problem of navigating today’s TV content — hundreds of channels, thousands of video-on-demand choices and myriad home music and photo selections, a bounty that overwhelms today’s grid-based navigation systems.

INTERACTIVE CHANGE

Hillcrest is pitching a dual remote-control and software-navigation system that would ride on set-top boxes and change the way consumers interact with their TV.

“This technology reinvents how content is presented or navigated on the TV,” said Addis, the executive vice president in charge of marketing and business development, who left Comcast two months ago. “It makes browsing unbelievable.”

Said company founder Dan Simpkins: “We have developed two key technologies. One is a new kind of remote control that simplifies the process.”

The second piece is a set-top software application that allows consumers to navigate TV content in non-linear fashion, Simpkins said. The program enables navigation of TV shows via direct access, in a manner more akin to Internet browsing. And TV is just the start.

“It will ultimately be able to control all devices in the home,” Simpkins said.

To start, Hillcrest has concentrated on the TV with two navigational applications. The first would control TV as it exists today — linear channels, VOD, electronic guides and digital video recordings. The second application would handle music, photos and other consumer content.

Hillcrest executives are meeting with MSOs, set-top providers and, more recently, telephone companies.

STILL STEALTHY

Exactly how the process works — and how the applications look — remains behind Hillcrest’s closed door.

“We’re in stealth mode,” Simpkins said.

The remote does not contain an alphabet or extensive lettering and has as many as 90% fewer buttons than a standard control. Those buttons don’t have any text inscribed on them or, at most, display just a single letter.

The remote interacts with navigational software in the box, relying on metadata sent from a server in the headend.

The application consumes less than 1 Mb of set-top memory and less than 10 Kbps of bandwidth from headend server to set-top, Simpkins said.

“We have designed the system to be extremely efficient,” he said. “What if I could show you 100 channels simultaneously?”

But Hillcrest executives declined to elaborate on exactly how that would work.

“We can present a much greater library of content choice,” he said.

Hillcrest is still putting the finishing touches on the applications. The software is scheduled to be completed by the fourth quarter and will be available for trials at that time.

A general-market entry is scheduled for summer 2006.

The business model is to license the core technology and create applications for service providers. To some degree, the company would compete with such established players as Gemstar-TV Guide International Inc., Microsoft Corp., Pioneer New Media Technologies Inc. and Scientific-Atlanta Inc.

Hillcrest is a virtual unknown in the cable space. Still, Simpkins exhibits a quiet confidence about what he and his team of engineers have developed.

FOUNDED, SOLD SALIX

Simpkins graduated from Cornell University with both bachelor’s and master’s degrees in electrical engineering. In 1990, he founded Salix, a voice-over-Internet protocol technology developer that was sold to Tellabs Inc. in 2000 for $300 million.

A year later, Simpkins and some former Salix engineers founded Hillcrest. They set out to find, and fix, the most vexing problem facing service providers.

Simpkins zeroed in on cable.

“There was a trend toward the proliferation of content,” he said. “The operators were adding content. There was a push to deliver a better experience. There was an expansion in choice, but not a change in the navigational system.”

And despite a concurrent explosion in new devices, from digital cameras to DVRs, there were “no obvious enhancements to content navigation,” he added.

Simpkins and company set out to basically rewrite the rules of TV navigation. The application is designed to help viewers browse through TV choices, whatever their intent.

Some surf in a linear fashion through the channels to answer the question, “What’s on tonight?” Others graze, as in “I feel like a movie tonight.” And some know exactly what they want, as in, “I want to watch a Sam Peckinpah Western.”

With today’s grid-based navigational system, consumers with any of those three interest levels have to go through clumsy systems, clicking the remote perhaps a dozen times or more to get what they want.

Hillcrest’s software is designed to vastly improve all three experiences — browsing, grazing and finding specific content.

Browsing resembles traditional channel surfing, but grazing requires “good organization and a good hierarchy,” Simpkins said. And finding requires some kind of a search engine.

“Our technology tries to provide the opportunity for all and improve all search techniques,” he said.

The ultimate goal is to spread this navigational system across other devices.

“This can be seamlessly ported to other devices,” Addis said. “We can leverage the same navigational paradigm.”

Addis said Hillcrest’s software doesn’t necessarily require that operators eliminate their current guides. Though the system includes a traditional electronic guide, it can also overlay existing guides and serve as a transition tool, he said.

NCTA DEMOS SET

“What you want to do is bridge [the gap] and provide an enhanced experience,” said Addis.

Hillcrest plans to keep emerging from its stealth existence with private demonstrations to a greater pool of MSO executives at next month’s National Show in San Francisco.

September