$59m deal sees interactive TV platform provider branch out into content development
Interactive TV platform provider OpenTV has acquired London-based visual media outfit Static for $59m, writes Adrian Pennington

The deal, which comprises 75per cent stock and 25 per cent cash and includes the transfer of the 10 per cent stake owned by BSkyB, marks a change in OpenTV's direction from pure infrastructure provider to content developer. CEO James Ackerman confirmed that he was on the hunt for additional content creation companies.

"It is important for us to move up the value chain and expand our role as an operator and supplier of content," he said. "Most of our revenue currently comes from set top box subscription and professional services but I am keen to build revenue from content. We've come to the UK because the UK is the reference point for interactive TV for the world."

The deal gives OpenTV access to a set of technologies it currently lacks which will enable cross-platform content development. Its software application is perceived as being too proprietary for most content creators whilst Static has built a business on technology and content applicable to the OpenTV platform as well as its rivals Liberate, Canal+ MediaHighway and MSTV.

OpenTV also gains control of multi-platform gaming channel PlayJam which has racked up over 300,000 subscribers since its December 2000 launch and is perceived as being one of the world's most successful gaming brands.

"PlayJam is not just a set of games but a brand and an attitude which is proven to attract the 18-24 year old demographic," said Ackerman. "The ability to run content simultaneously across multiple platforms is essential. If CBS wants to run an interactive version of one of its game shows it makes commercial sense to run that application on as many set top boxes as possible and not just OpenTV's."

Static will take charge of OpenTV's San Fransisco-based creative services division OpenTV Studios and oversee the roll-out of PlayJam in the US. Trials are already being conducted.

According to Static creative director Mark Rock the company had been looking to attract external investment for the past year. Talks with OpenTV had begun after Christmas last year.

"To expand the business and launch additional channels we needed investment. We talked to a series of venture capitalists and companies such as Liberate but Open had the resources and the vision which we felt was right."

Both Rock and CEO Jasper Smith continue to head up Static which retains its identity. A further Static-developed channel is expected to be launched in the New Year.