Tuesday, January 21, 2014

Verizon On Internet Buying Spree

It seems that Verizon is on a strategic mission with aggressive plans to compete in the wired and wireless space.  The growing demand for access to content and the platform to support it has led Verizon on a buying spree.  Last month, Verizon announced its plan to acquire EdgeCast Networks, a leader in the CDN or content delivery space; Now Verizon has formalized a plan to acquire the Intel Media unit and its OnCue TV business from Intel.  The OnCue platform, set top box and applications, was Intel's attempt to compete in the OTT space.  "OnCue is designed to provide pay-TV programming over any high-speed Internet connection, making it a threat to cable-TV services that deliver shows over dedicated lines restricted by territory. Intel’s system includes servers, set-top boxes and applications that can stream content to televisions, phones and tablets."

Now under the Verizon FIOS umbrella, content may finally be available for the service.  Coupled with a CDN to support stream demand, Verizon seems to be acquiring the pieces to augment its FIOS business beyond the confines of a wired franchise.  Certainly Verizon FIOS, along with its cellular business Verizon Wireless, aims to be a more competitive business to the cable and satellite providers.

The biggest impediment remains content companies, especially broadcast and cable networks, that work hard to protect all their revenue streams by limiting licensing agreements to specific platforms and uses.  It is why OnCue was unable to create an OTT line-up of channels to market to consumers.  Verizon is fortunate enough to have FIOS agreements in place as well as content from Redbox Instant.  But I'm sure given the acquisitions that have already occurred, Verizon has a strategic plan in place for content too.  And perhaps that includes buying a content company like a Scripps or Discovery to fill the bucket.  That would be my guess. 

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