January 16, 1998 (TOKYO) -- Hitachi Ltd. plans to start a satellite-based service called Home Kaleidoscope Channel, in April.

Using digital transmissions by satellite, the service will deliver video and data to home subscribers. Programming will come from cram schools, which prepare students for entrance examinations, and from pharmaceutical companies and providers of medical and social services.

Around 50 companies are interested in joining the service, and it is expected to launch with about 20 companies as committed participants. The target audience in fiscal 1998 is 30,000 users.

To get the service, customers must have a content provider. Also required are a satellite dish and a special receiver or a set-top box connected to a television set.

Hitachi's receiver is about the same size as a home VCR. Subscribers will be able to purchase or lease a receiver from the content provider.

The receiver has tuner and decoder functions, as well as a 2GB built-in hard disk drive for storing delivered data. Using a special remote control, interactive users will be able to select and play back recorded sound and images. The receiver also features e-mail messaging.

Users with personal computers will be able to download data after installing a dedicated PCI card.

If the system is utilized for educational services, lessons can be presented and students can play back programs at any time.

Hitachi expects the price of the education service will be about 30,000 yen (US$226) a month.

The Ministry of Posts and Telecommunications (MPT) has not yet issued licenses for data services aimed at individual customers in the communications category.

Hitachi said it initially considered offering the Home Kaleidoscope Channel as a broadcasting service.

MPT announced in December that as part of the government's emergency economic measures, video and data services for students of private schools and for members of specific organizations would be considered communications services.

Broadcasting companies in Japan must be no more than 20 percent foreign owned. Because 27.1 percent of Hitachi's shares were foreign owned as of September 1997, Hitachi was not able to operate as a broadcaster.

After MPT's decision, Hitachi can start its new service as a communications business.

(Nikkei Personal Computing)