Ericsson and Microsoft have come to an agreement over Microsoft's IPTV asset, Mediaroom. In a deal worth close to $200 million, Ericsson will be acquiring Mediaroom to allow Microsoft to focus on continuing with the Xbox being the center for all family entertainment. Mediaroom is a company that makes software that communication businesses use to send TV signal over the Internet, with one of their biggest projects being the AT&T U-Verse service.
Per Borgklint, Senior VP of Ericsson said,
Mediaroom is the leading platform for video distribution deployed with the world's largest IPTV operators. This strategic acquisition positions Ericsson as an industry leader thanks to the skills and experiences of the talented people of Mediaroom combined with Ericsson's end to end service capabilities.
With the acquisition, Microsoft will put to rest a twenty year mission to bring itself to the forefront of the IPTV space. Ericsson will now pick up the business and the technology, and the deal should finish up later this year. The company, who is already the world's biggest mobile networks maker, will become the IPTV leader as well, owning 25 percent of the market. A statement from Microsoft said that 400 people are employed at Mediaroom, and that it is used by more than 40 operators and powers 22 million set-top boxes across the globe.
Corporate VP of Microsoft, Tom Gibbons, was pleased with the transition of Mediaroom over to Ericsson.
We are proud of the number one IPTV market position that we have achieved with Mediaroom. Ericsson's complementary portfolio of TV and networking services will help drive the future growth and development of Mediaroom. Ericsson is positioned to be a valuable strategic partner for operators and TV service providers around the world as the IPTV market evolves.
On the Microsoft Blog, Yusuf Mehdi made it clear that this move will remove all distractions from Microsoft and will put all of the spotlight on improving Xbox's entertainment and media offerings.
With the sale of Mediaroom, Microsoft is dedicating all TV resources to Xbox in a continued mission to make it the premium entertainment service that delivers all the games and entertainment consumers want - whether on a console, phone, PC or tablet. And with 76 million Xbox 360 consoles around the world with 46 million Xbox LIVE members, it is a mission that gets us out of bed in the morning.
Some have been suspecting that the Xbox could transition into its own set-top box or TV service. Microsoft already lets Verizon, Comcast and U-Verse customers (obviously) use the Xbox as a set-top box, but has the time come for Xbox Cable TV? We've said on the show that Microsoft could offer an Xbox Platinum membership, which would include Xbox Music and Video, and this additional service could be a nice bundled feature for the higher-priced tier. What do you think? Could we see Xbox TV in the future? Let us know your thoughts in the comments below.