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Telecommunications leaders were waving yellow warning flags last week at the Western Show.

The annual cable TV conference in Anaheim, Calif., was more aptly christened the International Telecommunications Show by Robert McRann, chairman of the California Cable Television Association, the show's sponsor. Cable companies shared the floor with global phone giants, computer online services and software companies.

But the idea of convergence, the buzzword last year among those sold on the promises of a new world order in media, was held in skeptical regard by the 18,000 convention attendees, who have felt the effects of delayed tests, conflicting market research and the struggle to develop the needed hardware and software.

At a panel discussion kicking off the show, Tele-Communications Inc. President-CEO John Malone noted that the telecommunications industry "has announced a lot of technology to put in press releases that really hasn't been developed yet and isn't even ready for the marketplace yet."

"It's like we're developing this miracle drug," Mr. Malone told attendees. "It's killed a few bacteria, but it hasn't been tested on humans yet ... Last year, it was easier to speculate because we knew less. The more we know, the closer we have to get to reality."

U S West Chairman of the Board-CEO Dick McCormick said regulatory roadblocks are slowing development of the superhighway, but noted that could change with the new Republican-led Congress.

"Perhaps there hasn't been an event yet that determines the date when interconnectivity will be in Los Angeles or New York, but a lot is happening ... and the pace will pick up if we can get some legislation that's rational."

The future was clearer on the exhibit floor and during conference sessions, where there was evidence that interactive media is more than a pipe dream. More than 300 companies, from America Online to Zenith, demonstrated products that will make two-way TV and Internet access mass-market realities.

Time Warner, for example, will unveil to the press its long-awaited interactive TV trial in Orlando on Dec. 14. Among its service providers is ShopperVision, which wowed conference attendees with a demonstration of its virtual supermarket.

Microsoft Corp. and TCI will begin an interactive TV trial in 200 employee homes in Seattle during the first quarter of next year, expanding to 2,000 homes by yearend. Viacom and AT&T hope to begin and end their Castro Valley, Calif., test next year and to start national rollout in 1996.

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