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ONLINE DOCUMENT: CABLE TV THREATENED IN QUEST FOR EVEN GREATER CHOICE

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Not so long ago, cable TV was hailed as the medium of the future, giving unprecedented choice to hundreds of millions of viewers. Today, it faces extinction because the choice is deemed too limited.

The harbinger of its demise is a piece of revolutionary software developed by a small Israeli company, VDONet, which allows the broadcasting of live video streams over internet lines.This means that anyone with a net connection can watch their favorite TV show, news program or movie anytime and from anywhere in the world.

Once enough media companies adopt the technology, every internet user will be able to turn a home computer into a combination videorecorder and TV set with a virtually unlimited number of channels.

"We have created a new concept," said Oren Ariel, VDONet's chief technology officer. "Instead of sitting by the TV and waiting to see what pops up, people could surf the Internet and choose their own video content."

Although this video-on-demand technology is still experimental, hundreds of commercial companies have already bought VDONet's internet broadcasting software, which sells at $10,000 for a capacity to provide 100 simultaneous streams.

According to Ariel, the free VDOLive Player needed for viewing the videos has been downloaded by more than 1.5 million people since its launch in May. While video has been available on the net for several years, the only way to view clips has been to download them onto the computer's hard disk. It could take as many as 12 hours to watch a 10-minute film. With the VDOLive Player, all it takes is a few seconds of preparation.

The list of sites using VDOLive technology on the World Wide Web is growing every day. Already, one can watch the day's news from France3 TV, CBS and Japan's Nikkei Satellite News, promos from travel agents in Canada, the Nippon Telegraph and Telephone Learning System and a lengthy report on the Takayama Spring Festival in Japan.

The quality doesn't yet compare with regular television. So far, VDOLive offers a cigarette-pack-size screen with uncertain resolution when used with a typical connection rate of 14,400 to 28,800 bauds. The quality improves dramatically once the bandwidth - the width of the Internet's "information pipeline" - is increased.

"Within five years, we shall reach the quality of real television," predicted Ariel.

"Bandwidth availability grows in concert with bandwidth demand. So, if people demand video on the net, the net will expand to become Videonet," he said.

VDONet is the first company that has managed to squeeze video streams into the existing narrow bandwidths. It was achieved thanks to a compression algorithm discovered by three mathematicians who had immigrated to Israel from Russia.

The mathematicians and two Israeli-born executives from a Silicon Valley company, DSP, joined forces to establish VDONet early this year, launching VDOLive and its two-way cousin, the VDOPhone.

The company, located in Ra'anana, north of Tel Aviv, has already attracted prestigious investors such as the Battery capital fund and NYNEX, one of the largest U.S. phone companies.

In May VDONet had a staff of seven; today it has 75, two-thirds of whom work in research and development in Israel, while the rest are employed in marketing and business offices in New York, Silicon Valley and Tokyo.

(Distributed by Scripps Howard News Service.)