Why does Intel want to get into the Internet TV game?

Why does Intel want to get into the Internet TV game?

Summary: There are plenty of obstacles to the Internet TV service Intel is rumored to be considering. So why is it pursuing the idea?

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TOPICS: Mobility, Hardware, Intel
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Intel has long been trying to break into your living room, with its last attempt via a system-on-a-chip that it hoped set-top-box manufacturers would embrace. Now the chip giant has apparently pivoted, and is rumored to be working on an Internet TV service that would be delivered via its own set-top box.

Why would Intel want to involve itself in something infinitely more difficult than selling its chip to third parties? A cynic could argue that the limited success of its Viiv platform and related efforts has left it with plenty of excess silicon that it needs to somehow make use of. But the Wall Street Journal points out that CEO Paul Otellini is looking to move Intel in directions other than the computer industry, and this initiative, which may or may not ultimately use Intel's name, certainly would accomplish that.

An IPTV service could be the Holy Grail for viewers who are tired of paying for cable or satellite TV packages, and would prefer to purchase channels a la carte, one reason Apple seems to be pursuing the idea. Unfortunately, there are a number of massive obstacles to getting such services to market.

The primary one, of course, is getting TV networks to go along for the ride. That requires not only lucrative deals for each one, but also interest from the networks in actually striking a deal. Apple is supposedly having difficulty brokering such deals, so why would it be any easier for a company with limited content experience like Intel to make agreements? (Though it couldn't be any less flexible than Apple in terms of negotiating tactics.)

Another major issue is that such service still require Internet access, and guess who provides that to most consumers? The same pay TV providers that Intel would presumably be competing with for viewers. As the Journal suggests, those providers could raise rates on Internet access if more people start using huge amounts of bandwidth watching Internet TV.

Intel may ultimately scrap this idea if such issues get too complicated, but it has apparently solicited "rate cards" from networks to determine the costs of making programming deals, and has hired a BBC exec to lead a secretive Intel Media group. It's a tough nut to crack, but given its cash and ambition, Intel can't be counted out just yet.

The bigger question may ultimately be: Would you be interested in an Intel Internet TV service? Let us know your thoughts below.

Topics: Mobility, Hardware, Intel

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11 comments
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  • Could care less about IPTV

    I could care less about IPTV, what I'd like is pure internet service not tied to a cable or phone company.
    wally_333
    • ??

      So what do you think a "pure internet service" is if it isn't IPTV? And how do you expect to get it without High speed Internet access which is only available from a cable or phone company?
      atmusky
      • Don't you have an ISP?

        Internet services are provided by ISPs. Phone companies provide phone services and cable companies respectively - cable services. Not that pigs can't fly, but they rarely survive the hit when they fall down.
        danbi
      • Regarding: Don't you have an ISP Responce

        Sure I have an ISP they are either the phone company or the cable company. Do you have one that isn't a phone or cable company?
        atmusky
  • An Idea who's Time Has Come

    I think from a consumer point of view we would all like access to everything when ever and where ever we want to watch it.

    A good Internet based service can get allot closer to this than any existing cable/satellite service. Of course the key is cost and reliability. I hope Intel can get this done as someone needs to break and destroy the current cable/satellite model and it is unlikely that the cable/satellite companies will be willing to do it.
    atmusky
  • What does Intel have to do with any of this?

    So what is Intel's role?

    Will they convince the rights holders to let IPTV grow?
    Will they invest in Internet infrastructure?
    Will they invest in services?

    Or.. nobody is buying their chips anymore so they decided to use the existing stock to build set top boxes?
    danbi
    • Thinking outside the box...

      Or, the likes of Apple and Intel can get into content creation/distribution and offer their own "networks" and "channels".
      carrilion
  • How about Apple and Intel working this Two Ends to the Middle?

    I think there may be something happening here where both companies are working this to the center. The new IPTV entity could gain from this significantly and the two of them together are very powerful.

    Why? How's about Intel's interest in their architecture going into the set top boxes? Current Apple TVs have ARM processors, if Intel could strike a deal with Apple where their architecture goes the set top boxes, that would be a big win. All they need to do is apply their own pressure to the equation.
    dcristof
  • Cable is ancient history for me

    The high cost, the waste of paying for 40 or so channels of which I only watch a few, and the fact I have to watch commercials (at the cost of my time) has led me to drop cable as a medium for my entertainment needs (Oh, I forgot to mention the exorbitant taxes on top of that). I miss it, but not that much that I am ready to go back. Perhaps if I were a family man I would need it for kids, but since I am not, I would be willing to pay for (in streaming format):

    PPV sports on a game by game basis.
    Subscriptions to news channels I am interested in having access to.
    PPV movies.
    PPV weekly shows on an episode by episode basis.

    I am not alone here, there is a market for people with needs similar to mine, and existing providers or a startup entity ought to be able to supply that market at a profit. They can do that, or simply ignore my willingness to pay for what I want. It is up to them.
    louishelps
  • I Think I Know

    Could it be that political Paul has enormous delusions of grandeur?
    nikacat
  • Internet TV is about Choices

    I don't watch much TV. The reason is that what is being served up is not worth my time or money. I don't want 200 channels, I don't want advertising, I don't want a ton of movies. I am also willing to pay for what I want. I do like history shows, I do like certain teams, really good theater, first run movies, etc. With internet TV, this is all possible, but with current TV choices, it is not. I like certain shows like NCIS, Revenge, etc, but I prefer to watch them on my own schedule.

    Picking what you want, when you want it, is worth more than I am now paying!
    norm@...