NEW GAME IN TOWN CONTEST HEATS UP TO BUILD FIRST NATIONWIDE NETWORK

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The competition among new-media companies to develop the first nationwide interactive video and computer gaming network is getting hot.

Technology powerhouse EDS Corp., Dallas, last week joined the race, unveiling plans to link 10,000 North American computer and video terminals for interactive multimedia game play during the next three to five years. The deal includes a 10-year partnership with gaming consortium National Amusement Networks.

EDS' ambitious plans pit it against other new-media companies already racing to establish dominance over cable TV and broadcast channels in interactive multimedia gaming.

Time Warner, Tele-Communications Inc. and Sega Channel are testing a 24-hour interactive videogame channel designed for cable TV and planned for national rollout late this year.

In its merger with Paramount Communications and Blockbuster Entertainment Corp., Viacom International has also sketched plans for an interactive multimedia gaming network, and Sunnyvale, Calif.-based Interactive Network is now testing interactive games played on over-the-air TV in northern California and Chicago.

Industry insiders say the race is likely to become extremely competitive in the next 12 months as various entities scramble for dominance of interactive gaming through warring systems.

"Interest in developing interactive multimedia networks is extremely high. Everybody except the people who run muffler shops and quick lube operations seems to be getting into it," said Peter Sealey, president of Interactive Network.

Added to the circus of systems being tested is Congress' growing interest in regulating and rating violence in videogames, just as the games prepare to mushroom into dozens of different distribution channels.

Early this month, after hearings be fore the Senate Judiciary Committee on videogame violence headed by Herbert Kohl (D., Wis.), industry representa tives-including Nintendo of America, Sega of America, Electronic Arts and 3DO-agreed to voluntarily create a videogame ratings system.

"It's becoming very complex, but eventually we expect videogames to evolve into a distribution and ratings process not unlike the film industry, with established guidelines," Mr. Sealey said. "There is no way of saying when that will happen at this point, however."

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