12 years certainly does allow for some perspective, although people were insane in 1997 before the dot-con bubble burst (no "con" was not a typo).
From Microsoft Took WebTV Risk, Despite Loss, by Steve Lohr, May 5, 1997.
WebTV's under-the-hood technology was probably the real lure for Microsoft, says Roger McNamee of Integral Capital Partners, an investment firm. Imagine the day when HDTV, he adds, becomes affordable and popular, with Microsoft charging the manufacturers a license fee of, say, $50 a set for the software that brings the Internet to those souped-up sets.Well, HDTV is affordable and popular. Microsoft has the Xbox360... Sony's PS3, Apple's Mac TV approach, we have Boxee, Tivo, DVRs, even open source DVRs (Myth). I could go on about other parts of the ecosystem (like, Hulu). The internet is not currently the best delivery system for HDTV (digital cable, satellite, blu-ray...), even though I get both my internet and TV over the same cable.
I hate when analysts say dumb things.