Matav Chooses Microsoft TV Access Channel Server For Interactive TV Trial

REDMOND, Wash., and NETANYA, Israel, June 7, 2001 — Microsoft Corp. and Matav Cable Systems Media Ltd., one of Israel’s leading cable network operators, today announced that Matav will begin field trials of new interactive TV services based on Microsoft® TV Access Channel Server. When the trial begins later this summer, Matav will be the first company in the world to utilize Microsoft TV Access Channel Server, a server-based interactive TV software solution. This is Matav’s first trial of server-based interactive TV services.

When the trial starts, Matav subscribers will benefit from additional interactive TV content without having to upgrade their systems or set-top boxes. These new interactive services will include multimedia games and educational titles.

The service is powered by Microsoft TV Access Channel Server, a technology Microsoft gained through the acquisition of Peach Networks in April 2000. Microsoft TV Access Channel Server is a server-based application that enables delivery of interactive services and diverse Windows® operating system-based content to current-generation and advanced digital cable set-top boxes. Microsoft TV Access Channel Server helps cable operators tap into new revenue-generating opportunities. It extends the useful life of digital cable set-top boxes by delivering compelling new services and content, such as Windows-based applications, Internet surfing and e-mail functionality, and multimedia programs, using a software solution that runs in a network operator’s head end. Because the solution is server-based, it also allows for easy and centralized maintenance and upgrading of content and plug-ins.

“The Microsoft TV Access Channel Server solution seems to be the best suited for those types of services that are most attractive from the user’s point of view and cannot be supported by any other standard, known technologies,”
said Meidad Katz, vice president of engineering for Matav.
“We are very pleased to use it for our trial. Because Access Channel Server allows PC-based software including software for Internet access to run on our existing network, this brings us a step closer to making Internet access, Web services and computer-based education available in every home in Israel. Matav’s aim is to leverage our network to lead the Israeli market in information, communication and entertainment. Access Channel Server is enabling us to do this, and we look forward to beginning the trial.”

“Microsoft TV Access Channel Server allows interactive TV applications to be accessed via a wide range of digital set-top boxes,”
said Ofir Paz, general manager for Microsoft TV Access Channel Server at Microsoft.
“It therefore offers a very cost-effective solution to cable operators that want to offer this type of content to existing subscribers without sacrificing performance, functionality or potential revenue opportunities, or upgrading either their network or set-top boxes. This opportunity represents the first for Microsoft TV Access Channel Server since we acquired the technology, and we are really looking forward to working with Matav to help it deliver a cost-effective, compelling service to its subscribers.”

About Matav

Matav Cable Systems Media Ltd. (Nasdaq
) is one of Israel’s three cable television providers, serving roughly 25 percent of the population. Matav’s investments include 15 percent of Partner Communications Ltd., a GSM mobile phone company, and 10 percent of Barak Ltd., Israel’s second-largest provider of international long-distance and Internet telephony.

About the Microsoft TV Platform

The Microsoft TV platform is a standards-based, client and server software family that enables network operators and their partners to deliver the most compelling interactive TV services to consumers. The platform supports a range of TV devices – from current- and next-generation set-top boxes and digital video recorders to integrated television sets, entertainment appliances and other computing devices. Through the platform, network operators and hardware providers can team up to offer consumers an unparalleled range of services, from e-mail and Internet on TV to interactive programming, electronic program guides and digital video recording.

Microsoft TV also creates significant new economic opportunities for network operators and industry leaders worldwide who have chosen to work with the platform to deliver or supply services, programming, hardware and software for interactive TV. Microsoft TV supports open standards and is backed by the technical expertise, support and broad third-party developer community Microsoft is known for. It is an integral part of Microsoft’s .NET vision of empowering people through great software — any time, any place and on any device. More information about the Microsoft TV platform can be found at .

About Microsoft

Founded in 1975, Microsoft (Nasdaq
) is the worldwide leader in software, services and Internet technologies for personal and business computing. The company offers a wide range of products and services designed to empower people through great software — any time, any place and on any device.

This press release contains forward-looking statements with respect to the Company’s business, financial condition and results of operations. These forward-looking statements are based on the current expectations of the management of Matav Cable only, and are subject to risk and uncertainties, including but not limited to changes in technology and market requirements; decline in demand for the Company’s products; inability to timely develop and introduce new technologies, products and applications; loss of market share; and pressure on pricing resulting from competition, which could cause the actual results or performance of the Company to differ materially from those contemplated in such forward-looking statements. The Company undertakes no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. For a more detailed description of the risk and uncertainties affecting the company, reference is made to the Company’s reports filed from time to time with the Securities and Exchange Commission.

Microsoft and Windows are either registered trademarks or trademarks of Microsoft Corp. in the United States and/or other countries.

The names of actual companies and products mentioned herein may be the trademarks of their respective owners.

Note to editors: If you are interested in viewing additional information on Microsoft, please visit the Microsoft Web page at on Microsoft’s corporate information pages.

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