Ericsson has agreed to acquire US-based video encoding firm Envivo for $125 million to further strengthen its position in the rapidly changing TV and video sector.
Founded in 2000, San Francisco-headquartered Envivio generated revenues of $43 million during full year 2014. The company has an install base of over 400 TV service provider and content owner customers in all markets globally.
Envivio supplies software solutions to tier one TV service providers such as Comcast, Cox Communications, Liberty Global, Sky, Telstra and Time Warner Cable.
In a statement, Ericsson said the acquisition will greatly enhance the company’s software video encoding capabilities and its virtualized encoding concept, which enables the use of both hardware and software based video compression, as well as any deployment architecture.
"Our consumer research clearly shows that viewers are demanding TV on their terms on any device, and expecting experiences that continually evolve. We are committed to offering our customers a clear path towards fully agile cloud agnostic platforms that delight TV consumers,” said Per Borgklint, senior vice president and head of business unit support solutions at Ericsson.
Ericsson said Envivio's cloud-centric and software-based video capabilities will be added to the company’s extensive portfolio of media enrichment, processing, publishing, delivery, and TV platforms.
This will allow the delivery of products combining hardware and software encoding that will deliver an accelerated route to next generation UHD/HD services and High-Efficiency Video Coding (HEVC) technology.
Envivio's customers will be able to rely on the global stability and scale and the strong commitment of Ericsson in the TV and Media business with access to Ericsson's full portfolio of products, solutions, and global services expertise, the Swedish vendor added.
The acquisition is expected to close in the fourth quarter. Upon the completion of the deal, Envivio has 200 employees worldwide, will become part of Segment Support Solutions.
Separately Ericsson said it has signed an exclusive multi-year broadcast and media services deal with Viacom-owned UK broadcaster, Channel 5.
The company has also won two contracts from AT&T and Swisscom in the same week, under which Ericsson will help the US carrier evolve its satellite and wireline TV platform while provides the latter with its video storage and processing platform, enabling Swisscom to provide advanced cloud DVR and on-demand content access features to its subscribers.