RealNetworks announced that it has signed an agreement to sell a significant number of its patents and its next generation video codec software to Intel for a price of $120 million. However, RealNetworks will retain certain rights, which will allow it to continue to use the patents in their future products. According to Intel, the sale of the video codec software will help them deliver better video experiences on devices that use its chips. We know Intel is entering the smartphone segment this year and by doing so, they can officially provide additional format support in their phones without having to pay royalties. They could also block potential rival smartphone makers from using these codecs, which could give them an upper hand in the market.
In addition to the sale of the patents and next-generation video codec software, RealNetworks and Intel signed a memorandum of understanding to collaborate on future support and development of the next-generation video codec software and related products. Here’s what Thomas Nielsen, President and CEO of RealNetworks had to say, “Selling these patents to Intel unlocks some of the substantial and unrealized value of RealNetworks assets. It represents an extraordinary opportunity for us to generate additional capital to boost investments in new businesses and markets while still protecting our existing business.” RealNetworks businesses include a wide variety of SaaS products and services provided to global carriers, RealPlayer, the Helix streaming media platform, GameHouse online and social games, SuperPass and other media products and services sold both directly to consumers and through partners.
The RealMedia codec hasn’t exactly been the most popular one amongst users. Although it’s been around for a really long time, it hasn’t garnered very good interest the way AVI and MKV did. But given the fact that Intel has actually bought all the patents definitely means that there is something amongst the 190 patents and 170 patent applications that the chip giant is after. We guess we’ll know that in due time.
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