With a mind to divert all TV resources to the Xbox project, Microsoft has announced a deal with Ericsson for the company’s Mediaroom business. Announcing the deal, Yusuf Mehdi, Corporate Vice President of Marketing, Strategy and Business for Microsoft's Interactive Entertainment Business, said “We are proud of the world-class engineering and business achievements within Mediaroom. They have a rich history of driving innovation in IPTV. As early pioneers, they built the infrastructure to stream video on limited bandwidth, and today they enable multiscreen entertainment experiences for pay TV subscribers.”

Mediaroom, which powers the software behind AT&T's U-Verse TV service, is based in Mountain View. Its soon-to-be Swedish owners did not say in their announcement how much the deal was worth.

Microsoft has sold the Mediaroom business

Microsoft has sold the Mediaroom business

Mediaroom gives phone companies a way to provide a full-fledged TV services over phone lines. Ericsson says it's used in 11 million households and the AT&T service reaches nearly 4.5 million subscribers. Mediaroom’s services are also employed by Deutsche Telekom of Germany and Canadian company Telus Communications.

Per Borgklint, Senior Vice President and Head of Business Unit Support Solutions at Ericsson, wrote on the Ericsson site, “Mediaroom is the leading platform for video distribution deployed with the world's largest IPTV operators.” He added that his company’s strength in end-to-end capabilities will be greatly enhanced by the expertise that Mediaroom’s talent pool and skill brings in.

With the offloading of Mediaroom, Microsoft wants to divert all resources towards a big Xbox revamp and Mehdi went on to talk about what the future holds for the company's entertainment business. “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.

The next step for Microsoft is to build a premium TV service around the Xbox console. There has been word about the company wanting to build a Cloud TV platform for Xbox. Microsoft is expected to unveil the next-generation console and the services that tie into Xbox in May. We could hear more about their plans with Cloud TV and the future of television entertainment for those invested in Microsoft’s many platforms.

With inputs from Associated Press

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