AOL Time Warner’s bid for FCC ruling on electronic program guides (EPGs) is “backdoor tactic” designed to “bias” agency’s expected decision on DTV must-carry, Gemstar Chmn. Henry Yuen said in ex parte letter to FCC Chmn. Powell. Yuen said Commission decision allowing TW to strip EPG information from broadcast signals it carried would “bring significant harm” to more than 5 million consumers who bought analog TVs and VCRs that contain EPG capability and would seriously harm competition because manufacturers and retailers no longer would be able to build and sell such sets. Despite its request for declaratory ruling on EPG, TW has “expressed little or no interest” in actually stripping out EPG information, Yuen said, and in fact is contractually prohibited from doing so: “Its aggressive push for a declaratory ruling is obviously not motivated by any real need for resolving any analog carriage dispute… [Its] true intent is clearly about establishing a precedent that will influence future decisions on digital carriage issues.” He said granting TW request now “would be extremely adverse to public policy and prejudice the important issues at stake in the digital must-carry proceeding.”

Barnes & Noble said Thurs. that Nov. had been “especially robust month” for its GameStop division thanks to rollouts of GameCube and Xbox videogame consoles and “several hot-selling videogame titles.” Retailer said comparable-store sales for month-to-date through Nov. 24 were up 83.7% from year ago and comparable-store sales for Thanksgiving weekend increased 68.2%. Barnes & Noble said comparable-store sales at its core book retail locations edged up 3.2% in first 24 days of Nov., including 4% increase over Thanksgiving weekend. GameStop sales jumped 8.6% to $199 million in 3rd quarter ended Nov. 3 from $183.2 million year ago, company said, and its next sales report would be released Jan. 10 covering full holiday period.

EMachines’ potential new owner, EM Holdings, and its parent, KDS America, originally proposed buying company in June in 3-way deal involving shareholders KDS Korea and Trigem, it said in SEC filing. Latter 2 later dropped out, but stand to gain from proposed $166 million sale of company. Under proposed $1.06-per- share tender offer, which expires Dec. 27, Trigem, which owned 35.3 million shares (19.9% of outstanding common), would receive $37.4 million, while KDS Korea, which held 32.8 million (19.8%), would get $34.4 million. EM Holdings offer is being funded by up to $145 million loan from UBS AG, and $21.1 million from EM and KDS America CEO Lap Shun Hui. KDS America was among 55 companies, including Trigem and KDS Korea, contacted by Credit Suisse First Boston in May as it shopped eMachines, and 5 firms “expressed high-level interest” in pursuing acquisition, SEC filing said. As field narrowed to KDS America and unidentified 3rd party, Hui contacted Averil Capital, which had been handling deal after Credit Suisse bowed out in mid-Sept., about pursuing either management-led buyout or outright acquisition. EMachines CEO Wayne Inouye rejected management-led buyout proposal in Oct., but is expected retain position under new ownership, SEC document said. KDS America then bid 78? per share Oct. 30, which it raised to $1 Nov. 16 and $1.06 two days later. eMachines which had been trading at 43? at time of offer, has since risen to 96? and closed Thurs. at 97 cents. Under agreement, KDS America will receive $4 million termination fee if deal collapses. It can’t be extended beyond Feb. 28, SEC documents say. Averil Capital also will receive $1.7 million fee at close of transaction. Meanwhile, eMachines launched direct sales of its desktop PCs with opening of eMachines Online and toll-free customer sales center. Company said it had agreement with Federal Express to ship product ground, 2nd-day or next day. Retail traditionally has made up bulk of eMachines business, with Best Buy, Circuit City and Office Depot combined accounting for 57% of overall revenue in year ended Dec. 30. Direct sales via Internet and call center are expected to account for 1-5% of revenue over next 2 quarters, eMachines spokesman said.

Cable industry leaders said they're betting on today’s 6- year-olds to be tomorrow’s consumers of interactive TV (iTV). At Western Cable Show in Anaheim, panel was asked why public had been slow to adopt iTV, and the answer was simple: Keep it simple. “It has to be completely idiot-proof,” OpenTV COO Martin Leamy said. So simple, in fact, said Caroline Beck, CEO of Mixed Signals Technologies, that consumers didn’t even realize they were selecting their TV programming from databases: “Interactivity is best suited when it’s transparent.” Insight Communications Pres. Michael Willner said 33% of company’s customers in Columbus, O., had chosen digital service, in part because company had allowed them to have iTV “in the most passive way possible.”

NBC will air 8 hours of Winter Olympics programming daily in HDTV, with feed being repeated overnight, network said. Broadcasts will be in association with HDNet, company headed by Mark Cuban that produces HDTV sports programming.

Rex Stores said 3rd quarter net income rose to $4.2 million from $2.8 million on strength of strong DVD and digital TV (DTV) sales and income from synthetic fuel limited partnership. Sales increased to $106.6 million from $105.1 million, despite 3% decline in same-store sales.

TDK Mediactive (TDKM) officially jumped on GameCube bandwagon Thurs., saying it expected its first titles for Nintendo’s new console to ship in 4th quarter 2002. CEO Vincent Bitetti said TDKM now had “4 titles in development with more planned and anticipates a strong installed base of machines and increased demand by holiday 2002.” Three of those titles are Dinotopia, Robotech, Shrek. Last previously had been billed as Xbox exclusive. TDKM said 4th game would be announced later. GameCube developers currently under contract with TDKM include Digital Illusions, Prolific Publishing, Vicious Cycle.

Simon & Schuster Interactive will start shipping games for Pocket PC platform. Four titles are shipping in Dec. at $19.95 each: Empire of the Undead, Pro Car Racing, 3D Hunting Grizzly, 3D Hunting Trophy Whitetail.

Electronics Boutique acquired all outstanding shares of Tradition Svenska (TS), privately held video and hobby games retailer with 11 stores in several Swedish cities. TS also operates e-commerce business via 2 Web sites -- www.tradition.se and www.tradition.nu. Specialty game retail chain said transaction was in cash but declined to disclose specific terms. EB CEO Jeffrey Griffiths said acquisition “supports our ongoing strategy to leverage Electronics Boutique’s reputation and expand the company’s retail base in Europe and other key regions that offer solid growth opportunities.” He said: “From a geographic standpoint, Sweden allows us to leverage our existing retail and distribution infrastructure in Denmark and Norway while complementing retail operations in Italy and Germany.” He said EB planned to retain TS senior management and key employees, and said Louis Triche, senior vp of EB’s international operations, would relocate to Europe to coordinate operations and expansion plans.

InFocus forecast taking $4-$6 million charge against 4th quarter earnings to cover trimming of 125-150 jobs at Norway plant. InFocus inherited factory, which had been operated by Ask, in buying Proxima year ago. Proxima and Ask merged in 1999. Job cuts are 2nd major restructuring InFocus has undergone this year. In 2nd quarter ended June 30, InFocus signed contract manufacturing agreement with Flextronics to build portion of its front projectors at Malaysia plant, action that eliminated 130 positions. Flextronics accounted for 33% of 62,300 units InFocus shipped in 3rd quarter, figure that’s expected to increase to 50% in 4th quarter as company shifts 2 additional projectors to contract manufacturing. Restructuring is expected to narrow InFocus’s product assortment to 11 SKUs from 29 by end of 2002.