UPDATE 1-Intel plans to launch online TV service this year
DANA POINT, Calif., Feb 12 (Reuters) - Intel Corp plans to launch an online television service this year that will stream live TV as well as provide content on demand, confirming reports that the world's top chipmaker is getting into the media market.
Intel is currently negotiating deals with content providers,
Erik Huggers, vice president and general manager of Intel Media, told the AllThingsDigital "Dive into Media" conference on Tuesday.
"We have been working for (the past) year to set up Intel media, a new group focused on developing an Internet platform," Huggers said. "It's not a value play, it's a quality play where we'll create a superior experience for the end user."
He said the service would be centered on a set-top box and would offer smaller bundles than those currently offered by cable operators, tailored to what customers want.
Intel has struggled to get its virtual television service off the ground due to unwillingness on the part of major media content providers to let Intel unbundle and license specific networks and shows at a discount to what cable and satellite partners pay, according to sources.
The chipmaker's plans put it in the middle of Silicon Valley's battle for the living room. Heavyweights like Apple , Amazon and Google believe the $100 billion U.S. cable television ecosystem - dominated by major distributors such as Comcast and DirecTV Group and program makers like Walt Disney Co and Time Warner Inc - is ripe for disruption for reasons ranging from shifting viewer habits to ever-increasing programming costs.
Intel's plan, if successful, would go further than products currently offered by Apple, Amazon and Netflix by offering live programming as well as on-demand content.
Intel's set-top-box will also have a camera that could be used to automatically steer content and ads toward specific users.
"There is an opportunity to offer a bundle that can be curated by the consumer, an opportunity to create smarter bundles," Huggers said.
Huggers previously worked at Microsoft and the BBC, where in 2007 he launched iPlayer, an online service letting viewers catch up with programs they missed on regular television.
"The model we envision is a model where live television and catch-up television live in the same paradigm," Huggers said.
Intel's shares were up about 20 cents, or 0.90 percent, at $21.23 in afternoon Nasdaq trading.