Microsoft will invest £300m in NTL to jointly develop broadband services to the UK and Ireland. Microsoft software provides the backbone of the interactive services NTL plans to make available. "This partnership will enable Microsoft to become more involved in the digital TV arena," a spokesman for NTL said.
NTL plans to provide digital and interactive TV to a quarter of British homes. The company currently has 1.4 million telephone, cable television and Internet customers and a fibre optic network worth £3bn. The spokesman believes eventually "most UK households could take advantage of this deal".
NTL is also planning to form partnerships with high-street retailers, banks and news companies in the future to increase the interactive TV services available to customers. No details are yet available.
The NTL spokesman said the effects on consumers will be enormous. "It will change people's habits and the way they view TV. It will no longer be an object in the corner, but a major communications tool."
Craig Mundie, senior vice president for consumer strategy at Microsoft said of the partnership: "We are very excited by the opportunities we will have for expanding customer choice and control of their future TV experience."