COMPANY TOWN ANNEX

HBO Buys Crystal Dynamics Stake: Former 20th Century Fox President Strauss Zelnick’s entertainment industry connections are starting to pay off for the small video game company he left Hollywood last month to head. Home Box Office Chairman Michael Fuchs, a longtime friend of Zelnick’s, said the cable network has taken a 10% equity stake in Palo Alto-based Crystal, which is developing interactive games for the 3DO interactive TV system due out this fall. The investment by HBO, a division of Time Warner, also makes sense given its parent company’s investment in 3DO, whose success will depend largely on the software available to play on its machine. HBO’s is one of a series of recent investments by mature entertainment companies in the nascent interactive multimedia industry. As a myriad of small software developers vie for their attention, Crystal is thought to be particularly well-positioned because of Zelnick’s presence.