PALO ALTO, Calif. (Dow Jones)--Up to now cloaked in secrecy, start-up Rearden Steel and its brain child, Steve Perlman, will raise the curtain Monday on a new push into the nation's digital living rooms, a television set-top box with the ability to record music and video from the Internet and TV networks.
Perlman, who founded WebTV and sold it to Microsoft (MSFT) in 1997 for $425 million, also will unveil a new name for his company, Moxi Digital.
His aim is to offer a new generation alternative to the set-top boxes many Americans use to decode cable and satellite television signals. The Moxi Media Center, which will sell for between $200 and $250 to cable and satellite companies, will come with added features such as an 80-gigabyte hard drive to record programs, a DVD player, a firewall for security, e-mail and home networking capabilities to broadcast signals room to room.
The product will be demonstrated at this week's Consumer Electronics Show in Las Vegas.
Perlman also plans to announce a deal to deploy the new box with satellite broadcaster EchoStar Communications Corp. (DISH). Trials should begin in the late spring, and commercial deployment should take place this year, Perlman said.
Moxi will face plenty of competition in its ambitious plan from rivals such as Liberate Technologies (LBRT), Microsoft Corp. (MSFT), Motorola Inc. (MOT), TiVo Inc. (TIVO) and Sonicblue Inc. (SBLU). But it has a lot of ammunition.
The Palo Alto company formed in January 2000 has raised $67 million from backers including Cisco Systems Inc. (CSCO), EchoStar, AOL Time Warner (AOL), Washington Post Co. (WPO) and venture capitalists such as former Netscape CEO James Barksdale's Barksdale Group.
Perlman says his advantage is price. At $200 to $250, the box is similar in price to products on the market, but loaded with more features. "We are working with cable operators" to strike deals, Perlman added without identifying the companies.
"I am sure the product will be pretty," said Liberate Chief Strategy Officer Dave Limp. The challenge will be in striking the broad spectrum of partnerships necessary to participate in the interactive-television and home-entertainment markets. The danger is "they are trying to bite off too much of the apple," he said.
Moxi , meanwhile, is offering an interesting contrast to the home-entertainment plans of high-tech leaders such as Microsoft and Intel Corp. (INTC). Both see the personal computer - and not the set-top box - as the hub of an in-home system integrating television, the Web, movies, e-mail and digital music recorded in computerized formats such as MP3.
In two to three years, the PC will emerge as a communications center, doling out entertainment content to a variety of devices, Intel Vice President Louis Burns said during a presentation Friday.
-By Mark Boslet, Dow Jones Newswires, 650-496-1366; firstname.lastname@example.org