When GTE originally joined the Verizon family, one of the businesses that Verizon acquired and immediately sold off AmeriCast, GTE's fledgling cable company. That company was sold to Knology with the agreement that Verizon could not pursue any business in those markets that would compete with Knology for a period of several years. Verizon agreed to these demands because why would Verizon want to be in the content delivery business, right?
Fast forward to today, when FiOS and RedBox Instant are big business for Verizon, though market penetration for FiOS is low because of their original deal with Knology. So, in a day and age when content delivery is the business to be in, how do you expand your business? By buying another, failed company.
Enter Intel's OnCue, a web-TV service that has failed to attract content or enough momentum to offer the service publicly. It does, however, own a large amount of fiber-optic infrastructure, which Verizon desperately needs. So, with Intel's fiber and Verizon's FiOS content, this certainly seems to be a match made in heaven.
A deal has not been announced, though Bloomberg believes that an announcement could be made as early as this coming week. This will be good news to Intel, whose new leadership decided that this business did not fit in with the company's goals and should be sold off. As Intel regains its focus on chips, with renewed vigor in the mobile space, OnCue would simply be in their way.