After all, Intel has been trying very hard over the past decade or more to make sure they stay relevant in the post-PC age, starting way before Viiv and perhaps most notably with the company’s prolonged mobile push. I couldn’t help but be a little skeptical. Intel shares today are down 35 cents, or 1.4%, at $25.50.There may have been no one more skeptical of Intel’s content efforts than me. Verizon, it should be noted, has been gobbling up assets that are relevant, such as EdgeCast, the content delivery network, in December, and upLynk, a cloud-based television technology provider, in November. However, the source described Verizon's McAdam being in accord with the vision and strategy of the OnCue service. But there's always a possibility, says a source, that despite all the hard work around content deals, Verizon may go back to the table to renegotiate. The carrier certainly has tremendous assets, not just FiOS, but also the biggest LTE network in the country, 100 million subscribers, and retail outlets galore. The question going forward is whether Verizon is in earnest about promoting OnCue. Those stores did not go live as deals progressed, and instead were converted to Intel "experience stores." OnCue even had "pop-up" stores ready to go in New York, Chicago and Venice. Said the source, once those problems were dealt with, although everything comes down to price, "They asked for the moon, they didn't get it, and things ended up in a situation that was very comfortable" for OnCue. The team finessed that problem, and even finessed the problem that some content partners didn't have rights to all the content, and were worried about upsetting existing partners. Original sticking points for content owners were not just the price of content, said the source, but also whether content would get credit for Internet broadcast because traditional Nielsen household measurements don't match up to Internet viewing. OnCue was beautiful in its simplicity, with an elegant on-screen menu, and the ability to not only watch live television with only a broadband connection, but also the ability to surf through weeks of past television episodes.Ĭontent deals had been worked out with enough owners to make the service viable, said the source, deals with which the OnCue team were "perfectly happy." I had offered a profile of OnCue last summer in Barron's print magazine. "When you have zero market share in mobile, one could argue there is a need to cement the relationship" with Verizon. "Think of it in a way where you have a new CEO who has a strategy of delivering chips into phones and tablets, and no relationship with those big players," the carriers, says the source. Given Intel's lack of traction in mobile, and Verizon's control of the mobile world in the U.S., the deal, in other words, became as much about cozying up to Verizon as about offloading a distraction to Intel. There was " an amazing amount of interest from the industry," says the source, with many parties coming forward expressing an interest in OnCue.īut "very early on, the two CEOs got together," meaning Intel's Krzanich, and Verizon 's Lowell McAdam. Some may speculate that other parties in the media universe weren't interested in buying OnCue, given the asking price was apparently much less than a reported $1 billion originally.īut the source indicates that in some ways Intel was willing to strike a deal with Verizon in order to tighten the relationship with the carrier, regardless of what other deals were possible. But at some point, says the source, it became clear there was " zero interest" at Intel in progressing, and that resistance to a sale was futile. He had been "willing to go the distance." And to his credit, Krzanich was apparently willing to consider whether partnerships would allow the project to continue. Otellini had been "totally committed" to the project, said a source. As has been widely observed, Krzanich's focus is on returning Intel to its chip-making roots, with few distractions, as the company places increased focus on making progress in chips for mobile devices The source indicates that OnCue fell victim to the changing of the guard at Intel, with CEO Brian Krzanich taking over from Paul Otellini last May.
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