All the Internet heavyweights are literally heading south this week, and
Microsoft Corp. has now poised itself to take a major chunk of the action in South America with its first major investment in Brazil.
Microsoft announced late Monday it has spent $126 million to take an 11 percent stake in cable TV operator Globo Cabo as part of a plan to deploy advanced broadband and Internet services in Brazil.
The deal will involve content, broadband networks and Internet technology and will provide for joint services for PCs and set-top boxes targeting the Brazilian market.
Microsoft and Globo Cabo will create a joint marketing and technology group to create joint projects, including the current development a co-branded portal created from a merger between MSN.com and Globo.com. An interactive TV project is also in the works.
However, the alliance’s first move will be the launch of Virtua, Globo
Cabo’s broadband high-speed Internet access service, which utilizes the
Microsoft Commercial Internet System (MCIS) platform. The companies expect the service to be approved shortly by the Brazilian regulatory authority.
“We are looking forward to the rapid deployment to the
Brazilian market of next-generation digital services enabled by the
combination of Microsoft’s platform technologies and services with Globo’s network and leading content,” said Mauro Muratorio Not, Microsoft Brazil’s general manager.
“Microsoft’s capital infusion and the broader strategic alliance will
assist Globo Cabo in providing its subscribers with earlier access to a
wide range of advanced services over its broadband network,” said Moyses
Pluciennik, Globo Cabo’s chief executive officer.
Globo Cabo, a subsidiary of Organizacoes Globo, operates a two-way
architecture cable network that covers more than 4.5 million homes, and
holds interests in 18 cable television systems.
The deal gives Microsoft the right to increase its stake in Globo Cabo over the next three years.