Intel Plans to Launch Online TV Service AS PC Sales Slump

Chip maker company Intel plans to launch Internet-based TV service that can stream live TV as well as content on demand. The company will be stepping out of their comfort zone of making chips into a completely different ball game.

Erik Huggers, vice president and general manager of Intel Media, during the Dive into Media conference, told AllThingsD "We have been working for the past year to set up Intel Media, a new group focused on developing an internet platform,"

In a highly competitive market where heavyweights including Apple, Amazon and Netflix are already in the run for the money, Intel will be entering the race with lack of experience or relationships. However, if the service does take off, there is a high chance it can make it to the top, as the service offers both live TV stream and on-demand content.

A handful of Intel employees and their families already testing out the setup box, the company will sell as part of the service. Also, the company is in negotiations with content providers, as it gets ready to enter into $100 billion cable television industry.

Intel plans to offer consumers smaller bundles of content than the ones currently offered by cable operators. Eric says "It's not a value play, it's a quality play where we'll create a superior experience for the end user."

"There is an opportunity to offer a bundle that can be curated by the consumer, an opportunity to create smarter bundles," he adds.

Reuters reports 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 the company unbundle and license specific networks and shows at a discount to what cable and satellite partners pay.

A few media executives are doubtful as to whether Intel will be able to convince content providers to agree to the terms of the service, which is the key selling point.

According to Tech analysts intel's decision to enter into Internet television maybe due to the slowing of their PC market.