In response to the U.S. Justice Department's decision not to block Microsoft's acquisition of WebTV, NetChannel CEO Philip J. Monego, Sr. said today:

"The WebTV acquisition means that Microsoft is one step closer to fulfilling its strategy of dominating all aspects of the entertainment, electronic commerce and communications industries.

"Microsoft is becoming a standards, not a software company, positioned to collect a toll at virtually every link in the communications delivery system.

"NetChannel will continue to work within the industry to ensure that Microsoft is not in a position to control standards key to the healthy development of the entertainment, electronic commerce and communications industries.

"NetChannel will work with other companies that are concerned about diversity in the marketplace to promote open standards and choice for consumers.

"We welcome a fair fight. I hope that Microsoft will recognize that a level playing field, assuring fair competition, including open standards, will mean increased growth and more choice for consumers.

Background

In late July, Monego publicly released a white paper titled: Microsoft and WebTV: A New Threat to the Entertainment, Electronic Commerce and Communications Industries.

Through Microsoft acquisitions and investments, including WebTV, and personal acquisitions and investments by Microsoft CEO Bill Gates, Monego asserts that Microsoft is positioning itself as a standards company, not a software company, enabling them to dominate communications systems including:

-- Delivery system - recent investments in cable giant Comcast and Gate's investment in Teledesic, a company that will provide wireless access to the Internet;

-- On-line entertainment & information services - including the MSNBC television network, Slate (a political magazine) and Sidewalk (an entertainment guide) and a recent investment in Progressive Networks;

-- On-line banking & retail services - including Expedia (an Internet travel service), Carpoint (a car buying service) and various financial services that run with its Money software. The company is also continuing to attempt to further its widespread influence and domination by working with stock brokerages to develop on-line trading services; and

-- "Back-end" or server technology - many companies are running Internet services and publishing World Wide Web sites have been leveraged into using Microsoft operating systems and software.

NetChannel was interviewed by the Justice Department on the proposed acquisition. NetChannel is a WebTV competitor, available in consumer electronics stores nationwide in late Summer 1997 with the RCA Network Computer.

More Information about NetChannel

NetChannel will be the exclusive service provider for Thomson Consumer Electronics' new consumer Internet access devices. Thomson Consumer Electronics is the nation's leading manufacturer of color TVs and VCRs under the RCA, ProScan and GE brands. NetChannel is a strategic partner of Network Computer, Inc. (NCI), a wholly owned subsidiary of Oracle. NetChannel's role in this partnership is to extend the benefits of the NCI network computer architecture into the consumer marketplace. NetChannel supports an "open platform" philosophy which offers choice to content partners, hardware partners and, ultimately, to consumers.

NetChannel, headquartered in South San Francisco, was founded by a seasoned group of leaders from the communications and consumer electronics industries, including: David Atkinson, formerly vice president of interactive multi-media at AT&T west coast venture operations; Hermann Hauser, co-founder of Acorn Computers Limited; Philip Monego, Sr., Internet veteran and one time president and CEO of Yahoo! Corporation; and Steven Rand, a 25-year consumer electronics industry leader.

Founded in 1996, the company employs a staff of 125 with offices in South San Francisco, Atlanta and London. NetChannel Europe, a wholly owned subsidiary of NetChannel Inc., is based in London.