Extreme sports meet broadband

LOS ANGELES -- Broadcom Corp., a maker of specialty microchips, plans to launch a media company that will speed the convergence of television and the Internet, as well as pump up demand for its own products.

Irvine, Calif.-based Broadcom (Nasdaq:BRCM) is partnering with Gotcha International, a privately held maker of surfwear that also produces magazines and TV programs on surfing and extreme sports like snowboarding and skateboarding.

The plan calls for the new company, Broadband Interactive Group, or BIG, to acquire Gotcha's media assets including the Gotcha.com Web site and a library of sports footage.

BIG will then develop sports and other programs that need high speed networking equipment -- such as that currently made by Broadcom -- to produce full-action video for the Internet and for newly developing interactive cable TV services.

"We believe this investment will accelerate the creation of compelling broadband interactive content, thus spurring greater demand for the advanced cable set-top boxes of our customers," Broadcom Chief Executive Henry Nicholas said in a statement.

Good news for broadband
Broadcom specializes in high-tech equipment and microchips that help make broadband services work. Thus, any enhancement to broadband might help spur sales of its own equipment.

"Because we have such a strong position in the market, anything that is good for the market is good for Broadcom," Nicholas told Reuters in an interview.

He declined to say how much Broadcom was investing in BIG, but said it was poised for success because of the strong standing of Gotcha in extreme sports and because the target audience of 10- to 24-year-olds was active on the Internet.

"This is taking an existing media company, already profitable, and optimizing it for broadband," Nicholas said. "We're taking content people already like and enhancing it."

Merger of media and technology
The move follows similar intiatives by technology companies to spur broadband, which allows Internet users to connect at speeds 5 to 50 times faster than the fastest dial-up modems.

Last week, sofware giant Microsoft Corp. announced an initiative with several media and technology companies to drum up support for high-speed Internet content and its own Internet media software.

Nicholas said Broadcom is looking to gain a foothold in mainstream sports, too, by trying to gain media rights to the Anaheim Angels professional baseball and Mighty Ducks hockey teams owned by The Walt Disney Co.

Nicholas had been named as a possible buyer of the teams, but last week the billionaire entrepreneur said he was not interested in buying or managing a sports franchise.

He said Broadcom was trying to help Disney sell the Angels and Ducks to an unidentified third party that would then give Broadcom media and interactive rights to the franchises.

"We are interested in getting the interactive rights for some sport, and no sport is better for that than baseball," Nicholas said.