On Tuesday, Intel announced that it has reached an agreement with Verizon Wireless to allow the company to buy Intel's Intel Media service, which is "a business division dedicated to the development of Cloud TV products and services."
This division was originally working on a set-top box that would allow users to stream TV from the internet through the box onto a TV. However, it struggled to find partnerships with content providers that are necessary for a set-top box, and it hopes that Verizon, with its existing partnerships, will be able to make the internet streaming work.
The terms of the agreement have not yet been made public, but Verizon will purchase many of the intellectual property rights and other assets that enable Intel's OnCue Cloud TV platform. In addition, the company will offer the roughly 350 people working in this division of Intel employment opportunities under the same management as it has right now.
Intel hopes that this transaction will "accelerate the availability of next-generation video services, both integrated with Verizon FiOS fiber-optic networks and delivered "over the top" to any device."
Chairman and CEO of Verizon, Lowell McAdam, said in a statement:
The OnCue platform and team will help Verizon bring next-generation video services to audiences who increasingly expect to view content when, where and how they want it. Verizon already has extensive video content relationships, fixed and wireless delivery networks, and customer relationships in both the home and on mobile. This transaction provides us with the capabilities to build a powerful, capitally efficient engine for future growth and innovation. We will have the opportunity to enhance, expand, accelerate and integrate our delivery of video products and services to better serve audiences on a wide array of devices.
Intel CEO Brian Krzanich added:
Intel Media's over-the-top TV products are truly innovative and under Verizon's ownership have the potential to change how people interact with content. The critical factor in gaining efficient access to content is based on your ability to scale quickly in subscribers and end users, which is why selling these assets to Verizon makes perfect sense, with its millions of FiOS network and wireless customers.
The deal is expected to close early in the first quarter of 2014.
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