Verizon is acquiring the Intel Media division, both companies said in press release Tuesday morning. The deal includes the troubled OnCue TV service, which is a so-called "over-the-top" television service developed by Intel designed to compete with cable and satelitte TV offerings.
"The 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," said the statement.
Intel Media includes 350 employees, and they will continue to be based in Santa Clara with the current management team, which includes corporate VP and GM Erik Huggers. He helped launch the division in 2012, but it has struggled to negotiate content deals with media companies reluctant to help a potential rival to current cable and satellite TV partners.
"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," said Lowell McAdam, chairman and CEO of Verizon. "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."
No purchase price was attached to the deal, although it was expected to be somewhere in between the $200 million Verizon had been offering and the $500 million Intel had been asking for the service. The deal is expected to close in this first quarter of 2014.