This paper presents the basic hardware and software architecture of a class of multi-media terminals that are connected to networks which deliver entertainment and home shopping services to consumers. Some important attributes of the multi-media terminal are: simple user input devices (e.g. infrared remote control), real-time interactivity, adherence to international standards for information representation and communication, and support for downloaded applications from service providers. The terminal discussed in this paper is representative of the current offering of the Digital Video Communication Systems (DVS) business unit of Philips. These terminals are the result of close cooperation between research and product divisions of Philips world-wide in the race to compete in the rapidly growing multi-media and communications markets. The current architecture of the terminal reflects the urgency to get to market with a viable solution; therefore the paper gives some indication of future trends for the hardware and software architecture for this class of multi-media terminals.