Box Wars: Whose Gizmo Will Be Atop Your TV Set? : Video: Electronics manufacturers are hedging their bets on which technology will dominate interactive television.

As cable television and telephone companies race to develop their much-heralded interactive television networks, a fierce battle has broken out among electronics companies that hope to supply the billions of dollars’ worth of TV-top boxes that will be needed to make the networks a reality.

Most of the big names in computers and consumer electronics, including Apple Computer, American Telephone & Telegraph, Motorola, Microsoft and Toshiba, are scrambling to forge alliances and shape technology standards for the new boxes, which will serve as gateways in the living room to the new “information highways.”

The latest entry in this sweepstakes came at the start of the National Cable Television Assn. show here Sunday, when cable equipment vendor Scientific-Atlanta announced it was working with Kaleida Inc. (a joint venture of Apple and IBM) and chip maker Motorola to develop a computerized cable box.

And, in a graphic illustration of the complex, overlapping nature of these new alliances, computer vendor Silicon Graphics was expected to announce today that it will supply a variety of computer technologies for Time Warner’s interactive television trial in Orlando, Fla. It will also work with Scientific Atlanta to develop a set-top box for that network.

Other major players in the box wars are semiconductor manufacturer Intel Corp., Microsoft and cable equipment vendor General Instruments, which announced earlier this year that they would work together. And video game start-up 3DO Inc. hopes its new “interactive multiplayer” will emerge as the portal to interactive television.

For the electronics industry, the stakes are enormous: analysts expect millions of the new cable boxes, which will cost around $300 to $400 each, to be sold beginning next year. Unlike today’s cable boxes, the new devices will be high-powered computers that decode hundreds of digitalized cable signals and make it easy for viewers to navigate and make use of services such as movies-on-demand, interactive video games, and home shopping.

“He who owns the cable box platform owns the DOS of the next generation,” said Josh Harris, president of Jupiter Communications, a research and consulting firm in New York, referring to the software used in all industry-standard personal computers.

The computer companies also see gold in supplying the huge “video servers” and other advanced equipment that cable operators will need to offer the new services.

Cable operators are eager to deploy these technologies quickly, but at the same time, they want to make sure there are standards so that equipment supplied by different vendors will work together. The two biggest cable firms, Tele-Communications Inc. and Time Warner, announced Thursday that they would work together to promote standards for interactive TV.

Analysts said the two companies, which together serve nearly a third of U.S. cable subscribers, are trying to avoid two marketing blunders that plagued the introduction of the last two big consumer-electronics hits: the video cassette recorder and the personal computer.

VCR manufacturers battled for years over whether the Beta or VHS technology standard would dominate, causing cautious consumers to delay buying a VCR until they were sure which standard would prevail.

Personal computer manufacturers early on settled on the technology standards developed by computer chip maker Intel and software publisher Microsoft. However, while there are dozens of computer manufacturers selling PCs made to these standards, these companies are, with few exceptions, dependent on Intel and Microsoft for supplies of the critical computer chips and operating-system software.

“TCI and Time Warner want to set the standards early on, so the effort doesn’t get Balkanized into a array of competing products,” said Sharon Armbrust, an analyst at Paul Kagan Associates, a media research firm in Carmel. “They also want to be able to purchase their equipment from a variety of manufacturers, so they can bargain for the best price. The last thing they want is to be beholden to a single supplier.”

Avoiding such conflicts will be no easy feat. Scientific Atlanta, for example, is planning one line of digital cable boxes based on the Motorola Power PC chip and another based on Silicon Graphics’ MIPS chips. It’s not clear in what way they will be compatible.

Similarly, Kaleida hopes its Script X software will emerge as the standard operating software for set-top boxes. Microsoft is pushing a version of its Windows operating system to serve the same purpose, and it’s unclear whether the systems would work together.

The major cable operators and electronics manufacturers, in fact, are hedging their bets, pursuing several technologies at once in the hope that one of them will turn out to be a winner.

Some of the most potent players in the industry have not yet decided exactly where or how to place their bets. AT&T;, though not yet formally aligned with other equipment manufacturers, is already developing specialized chips to control video images in personal computers and other electronic gear. It has been selected by Tele-Communications to develop technology to compress digitalized video signals so that as many as 500 channels can be delivered to a subscriber.

Times staff writer Amy Harmon contributed to this story.