America Online and its European partner Bertelsmann this week launch a trial to provide online services to domestic television sets via a Mediabox decoder.
If successful, it will open up a much wider audience for online providers - many of whom are struggling. Europe Online was declared bankrupt this month, Apple shut down its eWorld service and CompuServe lost 200,000 accounts during the second quarter of 1996.
"For many people the PC is still a technical barrier, but the TV is easier to handle and every household already has one," says Bernd Schiphorst, president and CEO of Bertelsmann New Media. "No other electronic media has such wide distribution."
Advantages of access via cable to a TV include better picture quality and service 100 times faster than via the telephone to a PC, he claims. However, Schiphorst says, it will be several months before it becomes clear which system is the winner. Around 65% of German households can be linked via cable to online services and in some other European countries, the figure is even higher.
Meanwhile, it was confirmed yesterday (Tuesday) that AOL and Bertelsmann are to take a 33% interest in Deutsche Telekom's T-Online subsidiary, which will in turn acquire 20% of AOL Europe.
T-Online will be renamed Online Pro Dienste and will be headquartered in Darmstadt under the terms of the new deal. Axel Springer Publishing is also rumoured to be interested in taking a 5% stake in the newly-formed company.
AOL has 200,000 subscribers in Europe, 150,000 of whom are in Germany.Its main pan-European rival, the U.S. CompuServe, has over 800,000 subscribers in Europe, including 270,000 in Germany. T-Online is Germany's biggest online service, with 1.2 million subscribers, but it is not available outside the country.