HONG KONG -- Microsoft and Hongkong Telecom announced plans Tuesday to develop a high-speed Internet service, providing shopping, movies, news, music, and software using personal computers and televisions.
The cooperative effort links the world's largest software producer with Hong Kong's biggest telephone company, which has one of the world's most extensive fiber-optic networks.
A joint statement said the plan would "allow Hong Kong to fully experience the convergence of low-cost personal computers and telecommunications technologies."
Hong Kong subscribers with personal computers or televisions would be able to choose movies on demand, chat with friends in live video conferences, view news video clips, shop, play interactive games, and conduct electronic commercial transactions.
Gates described the proposed service, to be called Zoom, as "the Internet in a more powerful form." He believes that "people will use this to do things more efficiently, to find creative gifts, to plan trips, to stay in touch with people."
The high-speed network uses Hong Kong's 6.8 million residents as a test market for the new multimedia service.
Allen Ma, chief executive officer of Hongkong Telecom's Interactive Media Services, told a news conference that the launch of Zoom is only months away. "We should launch as soon as possible but the challenge is that we have built a home application.... Now it's a matter of adding content, making it content-rich," Ma said. He declined to give investment estimates for either company.
Hongkong Telecom's stock closed down HK20 cents or 1.35 percent at HK$14.60 (US$1.88) on moderate turnover of HK$605.1 million (US$78.07 million) on profit-taking and the realization that the alliance was unlikely to generate significant new earning revenues.
Hongkong Telecom jumped around 15 percent in the past two days on rumors of the Microsoft cooperation.
Among the new applications to be implemented on the Zoom service are video, music, software on demand, news from MSNBC, and the MSN gaming zone.
It will run on an integrated Microsoft platform, based on the company's Windows NT operating system and commercial Internet system.
Gates told a news conference that his company would join in Hong Kong's planned high-tech Cyberport project.
The HK$13 billion (US$1.7 billion) project is envisioned as an international multimedia and information services center which would attract new buildings equipped for high-speed, broadband networks.
Copyright© 1999 Reuters Limited.
