Zooming In On Interactive Tv

It's a tiny company. It has yet to make a dime, and it expects revenues this year of only $5 million. But ACTV (IATV) has attracted the eye of several media giants, including Washington Post Co., which has taken a 26% stake. Tele-Communications and Turner Broadcasting System have entered into alliances with ACTV on projects that will use its interactive technology. And Fidelity Management has purchased 5% of ACTV, now trading at 33/4 a share. Just what is it that's attracting these biggies?

Small as it is, ACTV has "positioned itself to become a leading company in developing and delivering interactive-TV programming for the entertainment and educational markets," says Peter Mintz, an analyst at Barrow Street Research. ACTV's patented technology is designed to integrate with existing television and video systems to "personalize" watching. For instance, the technology would let sports fans have an instant replay, zoom in on a particular player, or pull up statistics about the game. In education, children would be able to interact with TV programs by answering questions and checking their answers.

ACTV and Turner's Educational Services unit have agreed to collaborate in producing programs from CNN's and Turner's extensive film libraries. Tele-Communications and Turner, among others, will launch a test in Southern California early this year by hooking up 1,000 households with ACTV's interactive programming.

Investment adviser John Westergaard sees sales climbing to $15 million in 1996 and to $30 million in 1997, by which time ACTV should be in the black. The stock, he says, could hit 20 by then.

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