AT&T; Executives Impressed : Firm Says It Has Solved Problem in Videophones

It has been 23 years since American Telephone & Telegraph first demonstrated a “picture phone” at the 1964 World’s Fair in New York, and engineers ever since have been trying to devise an economical way for telephone callers to see the people they’re talking with.

Now, a tiny Irvine company working in secret for more than a year claims to have made a technological breakthrough that will allow it to produce video telephones showing full-motion color pictures--the combination of sight and sound previously available only to Dick Tracy, Captain Video, the Star Trek crew and other figures of fantasy.

Universal Video Communications actually claims two breakthroughs.

The first is technological. Universal’s videophones are the first to transmit full visual motion over ordinary telephone lines.

The second is financial. The cost of using ordinary telephone lines to transmit video is about half the cost of the cheapest alternative method now available for combining video and audio communications.

“The whole world is wired, and you can plug this machine in anywhere there are normal phone jacks,” said John E. Looney, chairman and president of Universal Video. “It’s a tremendously exciting kind of technology. And this is the first step in universal video communications.”

AT&T; executives who have reviewed Universal Video’s technology in three visits to the company are anxious to see the finished product, which is due by November.

“Their technology is unique,” said John W. Zellweger, venture manager for AT&T.; “The ability to send a freeze-frame (snapshot) over ordinary telephone lines has been there, but the ability to send motion has not been.”

With advancing technology and falling prices over the years, he said, consumers soon will “expect it” in their homes.

Until now, transmitting full motion and sound could only be done over special wide-width cables, with or without satellite assistance, and could cost thousands of dollars an hour.

The U.V. Communicator will go on tour around the country in November and will be ready for sale to businesses before March at a price of about $12,500 apiece, Looney said. A simplified videophone will hit the consumer market for $3,500 by the fall of 1988, he said.