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The Honolulu Advertiser
Posted on: Tuesday, August 31, 2004

Akimbo plans to launch Internet-to-TV video service

By May Wong
Associated Press

SAN MATEO, Calif. — The promise of Internet-based video has long been hamstrung by copyright and piracy worries, slow dial-up connections, technical challenges and consumer disdain for watching blotchy videos on their home computers.

Akimbo Systems Inc. founder Steve Shannon, left, and CEO Josh Goldman demonstrate their company's service that allows users to download video from the Internet and view it on television.

Associated Press

But a Silicon Valley startup is tackling those obstacles, hoping to become the first major provider of cinema straight from the Internet to the living room boob tube.

"Twenty years from now, everyone's going to be getting all their video mostly from the Internet," says Steve Shannon, founder of Akimbo Systems Inc. "You see it happening with music. You see it happening with phone service. Video is next."

With new video and copy-protection technologies, and the rapid expansion of high-speed broadband connections, the time may be ripe.

Akimbo hopes to tap the vast vault of programming floating on the Internet, repackage it in DVD-quality, and bring it to a set-top box so viewers can easily choose what they want to watch from their sofa — not from their desktop.

The San Mateo-based startup, which delayed its launch date from the summer to October after it hit technical snags, appears poised to be the first to deliver an Internet-to-TV video-on-demand service. Akimbo is targeting an audience that craves more than the programming on conventional TV and cable networks.

But it's unclear whether even the most dedicated video junkies will be willing to buy another set-top box and pay an additional monthly subscription fee. Akimbo also faces steep competition from larger rivals in the potentially lucrative market.

SBC Communications Inc. and EchoStar Communications Corp. have teamed up to launch an online movie-on-demand service next year. Digital video recording pioneer TiVo Inc. also is working on a product that will connect Web content to the TV screen.

But will consumers, many of whom already have tall stacks of electronic boxes by their TVs, open their wallets? Akimbo subscribers must first buy a $229 Akimbo Player set-top box, then pay a basic monthly service fee of $10. The company may charge more for premium services, and some shows will carry a pay-per-download fee — as much as $5 for rare films, or $1 to $2 for a kid's show, Shannon said.

Programming that users select will be downloaded via a broadband Internet connection onto the Akimbo Player's 80-gigabyte hard drive, which Akimbo says will hold about 200 hours of video. Download time roughly equals the length of the video, and the download must finish before viewing starts.