AT&T; to Use Liberate Technologies’ Cable Software for Interactive TV

AT&T; Corp. said it will use cable TV software from Liberate Technologies for a trial run with interactive television, a decision that comes soon after Microsoft Corp. warned of delays in a competing system for AT&T.; The pilot program will be introduced in an undisclosed market late this year, AT&T; said. If the pilot is successful, the companies expect to introduce interactive TV services commercially. Liberate’s software adds online capabilities such as e-mail, chatting, shopping and Web browsing to any TV in the house. The San Carlos, Calif.-based company’s backers include some of Microsoft’s fiercest rivals, including Oracle, Sun Microsystems and America Online. AT&T; is still bound by an agreement to use Microsoft software in as many as 10 million set-top boxes.

Separately, Liberate said its fiscal first-quarter net loss widened to $88.2 million, or 90 cents a share, from $12.5 million, or 17 cents, a year ago, as sales surged 78% to $9.4 million. The results were released after the markets closed. Liberate rose 44 cents to close at $29.13 on Nasdaq. AT&T; closed off 75 cents at $29.25 on the New York Stock Exchange.