Cable company Telewest’s interactive applications developer, SmashedAtom, is to shut its business unless a buyer can be found. The joint venture with Atomic Tangerine had a business model which relied on demand from third party broadcasters – a demand that has dwindled over recent months.
Telewest says that it is now not necessary for it to own an applications developer, preferring instead to outsource such work from now on. However, the cable group is continuing ‘full steam ahead’ with its own interactive television projects.
SmashedAtom will be gradually closed over the next few months unless a buyer emerges. The business will fulfil all of its existing contractual obligations with clients before it is closed. It is not clear how many, if any, of SmashedAtom’s 46 employees will retain employment with Telewest.
Comment
Telewest’s decision to give up running a dedicated interactive applications developer is evidence of the previously inflated expectations which surrounded the emergence iTV, the internet and – the Holy Grail – convergence.
iTV has not reaped the interest, excitement or revenue levels that much of the talk a few years back would have suggested, although that is not to say that it is not now definitely up and running. Cable companies, like Telewest, are best placed to make the most out of the interactive elements of digital television and maybe, ultimately, convergence. This is because their infrastructure – high-bandwidth broadband cable – allows for the fast two-way transfer of data from household to cable operator.
Telewest is therefore understandably keen to press on with interactive services development, even if the costs of running its own applications business cannot be justified at the moment.
