Zenith nabs set-top deal

The Americast programming alliance announced a nonexclusive five-year, $1 billion contract with Zenith Electronics Corp. for at least 3 million digital set-top boxes-a giant step toward the venture partners' goal of offering video services under the Americast brand name.

The Zenith boxes let the carriers deliver video over four types of networks: multichannel multipoint distribution service (MMDS), switched digital video (SDV), hybrid fiber/coax (HFC) or direct broadcast satellite. The MPEG 2, digital video broadcast-compliant box is customized at the factory with network interface modules for each technology, a Zenith spokesman said.

By choosing such a flexible set-top box, Americast is indicating its plans to move quickly to provide broadband access to the home, said Boyd Peterson, telecommunications analyst at The Yankee Group, Boston.

"Americast isn't ruling out any one technology or saying that one is dead," Peterson said. "It's saying that it wants [its partners] to get into the market by whatever means possible."

Although the value of the contract is impressive, Peterson says the big surprise is Americast's choice of Zenith as its set-top vendor.

"When you think about set-top boxes, you think about General Instrument or Scientific-Atlanta," he said. "We wouldn't have figured that Zenith would have come out with this deal."

Zenith has manufactured analog set-top boxes for the last 15 years, but this is its first digital box, the spokesman said.