(Reuters) - Chipmaker Intel Corp is having second thoughts about getting into the television business and is in talks with Verizon Communications Inc to take over its Internet TV initiative, a source familiar with the matter said on Wednesday.
The news was first reported on tech website All Things D, citing anonymous sources.
While discussions are in the advanced stages, it was still unclear if Verizon plans to take full control of Intel’s media unit or if Intel would maintain a stake in the unit, the report said.
Representatives from Intel and Verizon both declined to comment.
Earlier this year, Intel decided to launch an Internet TV service with live and on-demand content in a bid to find an alternative revenue stream as its core business of providing chips to computer makers erodes. It hired hundreds of workers and opened offices in Los Angeles and New York to work on the project.
The field of players competing for in-home entertainment audiences is increasingly crowded. Apple Inc, Google Inc, Sony Corp and Microsoft Corp are jockeying for position to own the living room through TV, while Netflix Inc and Amazon.com Inc’s streaming video services have millions of subscribers.
Verizon already has a streaming product as part of a joint venture with Redbox, which focuses mostly on streaming movies and not on TV shows, according to its website. That product competes with Netflix.
Intel has struggled to reach content deals with media companies even though it offered to pay sizeable premiums over traditional cable rates.
Doubts about Intel’s commitment to the venture emerged in June after newly appointed Chief Executive Brian Krzanich warned he was taking a cautious approach to television, which is far from the company’s core business of chip manufacturing.
Reporting by Liana B. Baker in New York; Editing by Jeffrey Benkoe and Leslie Adler