Intel Looking to Sell Online Pay TV Service for $500 Million

Intel is reportedly asking about $500 million for its OnCue service, which the chipmaker developed before making the decision to no longer pursue its online pay TV ambitions. The company is looking to secure a sale by the end of the year, according to inside sources. Verizon, which has been talking with broadcast and cable channels regarding terms for a streaming TV service, is believed to be one potential suitor. Intel has also met with Samsung and Liberty Global.

“A sale that meets Intel’s asking price would let the company recoup its costs as it retreats on a plan to enter the pay TV business, while still supplying chips to the new owner,” reports Bloomberg. “Samsung Electronics Co. and Liberty Global Ltd. also met with Intel, people said earlier. Intel’s TV efforts slowed under Chief Executive Officer Brian M. Krzanich, who took the reins in May and has focused on getting chips into mobile devices.”

OnCue has the ability to provide pay TV programming over any high-speed Internet connection, and features a system that includes servers, set-top boxes and apps that stream content to mobile devices.

“Verizon, one of the biggest U.S. phone and wireless operators, runs the FiOS fiber-optic pay TV service that competes with cable companies,” notes the article. “OnCue would let Verizon sell pay TV outside the current FiOS footprint. The company has been asking media companies if a streaming service would require new contracts for shows, or whether existing FiOS TV agreements could be amended to include the additional rights, the people said.”

“This month, Intel chairman Andy Bryant admitted to investors that he was ‘personally embarrassed’ that Intel seemed to have lost its way, as it was caught unprepared for the shift in consumer patterns,” explains ZDNet. “As the general public moved away from desktops and notebooks, preferring to spend out on tablets and smartphones instead, Bryant said the company is ‘paying the price’ for not jumping on the bandwagon quickly enough.”

In response, the company has pledged to quadruple the number of tablets that feature Intel chips next year.