Microsoft `Tiger' Software Grabs at Superhighway's Tail

Product symbolizes company's aim to widen dominance

MICROSOFT Corporation, king of computer software, is trying to grab the information superhighway by the tail with a new product code- named ``Tiger.''

The software will deliver ``video on demand,'' the service that many cable-TV and phone companies expect to be lucrative enough to justify billions of dollars of investment in their networks. But Microsoft hopes that will be just the beginning.

Tiger symbolizes the company's aim to extend its dominance in personal-computer software into other arenas where computer chips are reaching with their fast-falling costs. ``Computing is moving into the living room,'' and into cars and kitchens, says Nathan Myhrvold, Microsoft's senior vice president of advanced technology. ``We have to follow ... with software.''

He says two devices will hold top places as information tools: the PC and TV set. The Redmond, Wash., company already dominates software for PCs, which are now in one-third of United States homes. The TV market, though, is up for grabs.

Microsoft's video-on-demand system is one of several on the market, and the firm will not begin large-scale consumer tests until late 1995, long after many planned tests by cable and phone companies. Still, analysts say the technology looks strong.

A recent demonstration here showed how Tiger could allow thousands of viewers to receive different movies - or the same movie - on cable TV. As with a video cassette, viewers could rewind or pause their films of choice.

This ``virtual video store'' has been the most discussed new service on the budding information highway, which technologists call a broad-band digital network. But costs must be kept low, says Gary Smaby, president of the consulting firm Smaby Group in Minneapolis.

Americans spend around $380 a year on various media, including books, movies, and magazines. Mr. Smaby says that number is unlikely to change significantly. So technology companies must deliver content either competitively priced or different enough to lure consumers away from video rentals or other media.

That's where Microsoft claims an advantage. Tiger can run on a variety of hardware systems, including those based on PC components. Because high volume keeps prices low in the PC industry, Mr. Myhrvold says these systems will always be cheaper than mainframes or supercomputers that most rival systems use.

``The PC will be providing the foundation for the information superhighway,'' says Avram Miller, vice president of Intel Corporation, the leading maker of chips for personal computers. Intel and Compaq Computer Corporation, a PC maker, staged the demonstration with Microsoft.

Smaby applauds Microsoft's bottom-up, egalitarian concept, which includes opening the door for other companies to write software applications to run with Tiger.

Microsoft points to possible uses for Tiger on a small scale, not just citywide video distribution: TV screens on airline seatbacks, hotels, or cruise ships; video mail within companies; video shopping guides; information kiosks at malls; and uses for government services, such as a video guide to campsites in state parks.

Some observers wonder if Tiger will work as reliably in large-scale applications, such as mainframe- or supercomputer-based systems. But several things appear to be going Microsoft's way:

* Its rich cash flow allows the company to plow $100 million a year into developing products for the information highway. Another team is developing software for the consumer, to guide TV sets through their new paces. This software , controlled by simple keypads, will reside in set-top boxes Microsoft is developing with General Instrument Corporation.

* Big partners are lining up. On Tuesday, Canadian cable giant Rogers Cablesystems Ltd. committed to deploying Tiger. US cable provider Tele-Communications Inc. plans to test it in 1995.

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