Xbit: Intel reportedly working on Internet TV Service

[cbn]

http://www.xbitlabs.com/news/multim...eportedly_Working_on_Internet_TV_Service.html

In Addition to Chips, Intel May Start to Offer TV Programs
[03/12/2012 10:51 PM]
by Anton Shilov

Intel Corp., the world's largest maker of chips, is reportedly working on an Internet TV service. Not a lot of details about the service are available now, but since Intel owns loads of telecommunication technologies as well as some codecs and software, the chip giant has technological abilities to launch its own Internet TV service, a move that has potential to forever change the company.

Recently Intel withdrew from Google TV initiative and acquired media codecs from Real Networks, which points to the fact that the company is working on something related to media. According to the Wall Street Journal, Intel has for several months been pitching media companies on a plan to create a "virtual cable operator" that would offer U.S. TV channels nationwide over the Internet in a bundle similar to those that are sold by actual network operators.

Intel reportedly planned its own set-top-box that it would offer to end-users, who would obtain Internet subscription simultaneously. Some media companies were asked for prices of particular channels or programs, but nothing has been signed yet. One of Intel's ideas is to sell relatively small bundles of channels rather than large bundles already sold by operators.

What is unclear is how Intel plans to make its "virtual operator" more competitive than actual operators among end-users. Moreover, it is unclear what advantages will Intel's operator bring to content owners: there are tens of services that sell on-demand video and lack live shows and the chipmaker is unlikely to offer just a little better pricing.

Intel did not comment on the news-story, but a number of its recent activities prove that the company is working on something to ensure higher amount of its chips are installed in living rooms worldwide.

A possible vertical integration move by Intel is a really interesting idea.

When I see this type of article it really makes me wonder what the future holds for enthusiast level x86 CPUs? Maybe the company is pulling money out of the hardware division and investing elsewhere for various reasons? Maybe increasing Fab costs (16nm and beyond) are taking up too much money? How about heat density issues on advanced nodes reducing sales of the lucrative extreme edition consumer processors in the future?

If any of this is true, it would seem to me some type of vertical integration strategy by Intel could mitigate the damage.

Or maybe I am completely wrong and company has spotted some ways to bring disruptive technology to the market.....in addition to leading consumer and server CPU for many years to come.

 

[MisterMac]

Just like intel buying McAfee, this seems like a pre-emptive defensive move because of the uncertainty of x86 patents and ARM coming in.

It's just diversifying while it has the MAD bank to do it.
In the future i foresee intel almost only manufacturing, since that's what they really school everyone in.

No one can produce in the ammounts intel does, with the yields, at the progressingly lower nodes.

 

[dealcorn]

For some reason the networks who own the content they paid to produce do not want to give it away or transfer it's value to the artful. That is why networks are so fearful and conflicted about how to monetize their content on the Internet. Instead, they fund ineffective litigation that does not reduce piracy. With the year+ old Intel Insider "...studios are significantly more likely to offer streaming services for new-release feature films to PCs - and the fact that the Intel Insider security can be layered over existing Digital Rights Management (DRM) implementations means that Hollywood stays in control of the video the entire time." (http://www.itproportal.com/2011/01/07/intel-insider-tech-risks-monopoly-accusations/) Sounds like Intel finally has enough Sandy Bridege chips out there to make this a viable business opportunity.

It's about eliminating or reducing the middleman's take as the networks monetize their content. From the network's security perspective, Intel Insider is probably about as good as it gets today. A virtual network is basically a server farm with some database, accounting, and Internet connectivity. If a bunch of networks sign up Intel can probably do it cheaper that the networks could in house while still making enough money for it to make sense. Intel's pitch is they can unlock the value of content the networks already own. In addition to being more trustworthy than your typical Chicago Alderman, Intel probably understands that it is not their content. Intel's compensation is for running the server farm and making the software run together securely. Sometimes business relations work better if you are not a pig. I wonder if they plan on using Xeon servers?

 

[pelov]

Though I agree with your assessment, wouldn't Intel be just another middleman in the grand scheme of things? Though a necessary middleman if you consider that the providers will never work with each other and would rather offer their own services so we'd need someone to merge it all.

Definitely agree with the diversification comments as well. This is just Intel looking 4-5 years down the road when selling x86 won't be as profitable.

It's certainly an interesting idea, but just how tightly can they pack the content they're streaming? I mean, we've had a stalling of internet speeds with gimmicks like "4G LTE" being sold to uneducated consumers thinking they're getting something that's even remotely close to actual 4G data speeds. My verizon DSL has stayed at a steady 3mbps for years now and they've stopped expanding their FiOS network.

I'm always skeptical about services like this. Cloud computing and internet TV are awesome ideas, but they rely on one thing that never gets mentioned: increasingly faster and cheaper internet availability. I'd hate to be gaming on the same ethernet wires that offer me 1080p content, never mind 4K in the future. It's like electric cars. Great idea and looks awesome on paper until you realize how we make the batteries and realize that there hasn't been an advancement in battery power in how long now?

 

[pelov]

double post!

 

[Idontcare]

Gateway to releasing their own gaming console?

 

[dma0991]

Intel trying to bring back MeeGo?

 

[grimpr]

Just trying hard to be Apple, thats all.

 

[dealcorn]

Success has many fathers and one reason for many years Walmart did better than the competitors is they got more out of IT than their ilk. A virtual network is almost pure operations where being the low cost distributor is almost the most important thing. The other big criteria is that whoever is running the thing must be like Caesar's wife with no skin in the game except they run operations pretty good. The last thing networks want is some talented kid who is gonna steal their business while pretending to be buddies. (Bill who(?)).

That is why Intel might be an ideal partner. Intel could structure the thing as a coop and achieve it's objectives as long as the entire world appreciates that they need the Intel Insider thingee and the servers are Xeons. The networks have no problem paying reasonable compensation for what they view as a purely mechanical operations stuff (like a virtual network) as long as it helps them monetize the value of their content. There is no conflict between network and Intel's objectives. Some discussions are required and the networks might find it comforting if Intel get chatty about McAfee.

That is why I do not see this as diversification. If Intel shows any interest in traditional network stuff, the deal is dead. If some Intel muck-a-muck tries to make Intel a generic server farm operator, Intel's Board will take the guy out. The Board is not not going to put up with peripheral low margin nonsense. If the deal helps the world understand they want to buy Intel stuff so whatever you want just works, everyone is happy.

 

[nonameo]

In other news: Cable ISP caps reduced to under 100gb

 

[dealcorn]

Intel might be smart enough to appreciate the Burger King mantra: "Have it your way." In context, that means tiered pricing. Cheapest price is with commercials where Intel gets to customize what commercials you see using all available public information about you from the web. If you pay a bit more they will limit the commercial customization to reflect only location information. Top tier pricing gets you commercial free programming. Also, if you have a 3 year old with Juvenile Diabetes there might be merit in paying a premium to block all ads for sugary breakfast cereals. Other folks might want to pay to limit God commercials to a preferred brand. Networks are envious of Google's ability to charge premium rates for commercials by using publicly available targeting information. If Intel is able to deliver similar targeting benefits instead of just monetizing, Intel will substantively increase the value of network content.

Distribution cost almost vanish if you do not pay for things like broadcast towers and unnecessary cable connections. Why pay for multiple cables if you have the Internet?

This will re level the playing field. I have cable TV with about a hundred channels of which I watch a few like the History Channel. If I subscribe through Intel I guarantee the History Channel will see much more revenue from me than it does as 1/100th of my cable bill less everyone's piece of the action. Most likely I would subscribe to 3 channels and pay higher rates for a few individual shows.

I wonder if the networks want to both enhance the value of and monetize what they already paid for? If you already max out your Internet connection with a p2p client, this might limit your pirating activities. Somehow, I do not think that the networks will cry about that.

 

[cbn]

For some reason the networks who own the content they paid to produce do not want to give it away or transfer it's value to the artful. That is why networks are so fearful and conflicted about how to monetize their content on the Internet. Instead, they fund ineffective litigation that does not reduce piracy. With the year+ old Intel Insider "...studios are significantly more likely to offer streaming services for new-release feature films to PCs - and the fact that the Intel Insider security can be layered over existing Digital Rights Management (DRM) implementations means that Hollywood stays in control of the video the entire time." (http://www.itproportal.com/2011/01/07/intel-insider-tech-risks-monopoly-accusations/) Sounds like Intel finally has enough Sandy Bridege chips out there to make this a viable business opportunity.

Great post.

I know Intel sells quite a bit of the newer processors, but what about all the people who do not need the computing power of Sandy Bridge? What about the people who like ARM powered devices or use other x86 PCs for their daily computing needs?

 

[cbn]

Distribution cost almost vanish if you do not pay for things like broadcast towers

Broadcast towers?

So we are talking about freeing up additional spectrum beyond the "white spaces"?

 

[dealcorn]

I know Intel sells quite a bit of the newer processors, but what about all the people who do not need the computing power of Sandy Bridge? What about the people who like ARM powered devices or use other x86 PCs for their daily computing needs?

The selection of Sandy Bridge as an intro vehicle does not mean it is not already baked into Atom designs at some future dimension like 22 nm or 14 nm. For ARM fans, recall the charming line from the Borg (or was it the Darlik(?)): "You will be assimilated." If the market is viable and Intel dominates licensing of the technology may ultimately become mandatory, but that takes time.

 

[cbn]

The selection of Sandy Bridge as an intro vehicle does not mean it is not already baked into Atom designs at some future dimension like 22 nm or 14 nm. For ARM fans, recall the charming line from the Borg (or was it the Darlik(?)): "You will be assimilated." If the market is viable and Intel dominates licensing of the technology may ultimately become mandatory, but that takes time.

Atom really does make sense if Intel is to get this off the ground.

 

[Hulk]

I would really like to see content providers going live with their stations online and charging a monthly or yearly fee for the channel. No more middleman (Comcast, Dish, etc..) bundling channels so you have to pay for channels you don't. You don't have to pay the middleman either. Each channel would stand on its own in the competitive market. The market would "find" the price for a particular channel.

Of course this will never, ever happen since the Cable lobby in DC is among the most powerful of all such organizations. We will stay locked in to a ridiculous, totally non-competitive system where you have to "buy" 100 channels even though you only really want about 10 or 15 of them.

 

[cbn]

I would really like to see content providers going live with their stations online and charging a monthly or yearly fee for the channel. No more middleman (Comcast, Dish, etc..) bundling channels so you have to pay for channels you don't. You don't have to pay the middleman either. Each channel would stand on its own in the competitive market. The market would "find" the price for a particular channel.

Of course this will never, ever happen since the Cable lobby in DC is among the most powerful of all such organizations. We will stay locked in to a ridiculous, totally non-competitive system where you have to "buy" 100 channels even though you only really want about 10 or 15 of them.

Maybe Intel will instead pursue the major non-cable networks (CBS, NBC, ABC) initially using the "white space" between the Digital TV spectrum?

If Intel succeeds at impressing the networks by making the most out of the little scraps of "white space" they are given.....then what is the chance major networks would begin transferring or sharing "non-white space" spectrum with Intel (or whatever competitor arises to compete with Intel)?

Hopefully some experts can chime into this thread....and point out whatever obvious things I am missing (I don't understand much about spectrum in general!)