Friday, December 3, 2010, 6:34 PM ET|Posted by Will RichmondJust as the week is wrapping up, Google has announced its acquisition of Widevine, a provider of digital content protection and video optimization technologies. Widevine was a private company that had raised over $50 million to date. The acquisition is very noteworthy as Google will now own a 60+ patent portfolio in the critical area of securing digital video delivery to every conceivable type of viewing device. As such, Google has a critical building block in its ability to deliver premium content to devices using its Android, Google TV and Chrome technologies.
In addition to the technology, Google is also inheriting Widevine's customer relationships with many leading consumer electronics, content and distribution companies. Among Widevine's long list of customers are Panasonic, LG, Best Buy, boxee, Sonic Solutions, LOVEFiLM, Samsung, DISH Network, Netflix, Blockbuster and others. All of these relationships give Google further opportunities to drive Google TV adoption and further immerse itself in the video ecosystem.
With the deal, Google will also have far greater credibility when it approaches Hollywood studios to license and deliver their content. The Widevine deal moves Google a long way from the withering criticism it endured over YouTube's lackadaisical approach to copyright protection, which made it a virtual pariah in Hollywood circles. Just this morning, I mentioned in my "5 Items" post that YouTube was celebrating the 3rd anniversary of its "Content ID" system that has given YouTube far greater legitimacy in the media world. Now, with Widevine under its roof, Google has even stronger bona fides in content protection, which is crucial to Hollywood ramping up digital distribution (btw, the deal also raises questions about how Google-Widevine will impact the UltraViolet digital locker initiative).
Put the pieces together - Google's massive search reach and monetization, YouTube's dominant online video market share, the company's push into mobile devices through Android and TV through Google TV, its earlier acquisition of On 2 Technologies and subsequent open sourcing of its codec as WebM, its hiring of Robert Kyncl, Netflix's number 2 content executive over the summer to lead its own content acquisition efforts, and of course, the company's bottomless financial resources, and it's very clear that though it still has plenty of work ahead of it, Google is poised to become a big player in the distribution and monetization of Hollywood content.
With the Widevine deal, everyone in the video ecosystem just got another big reason to think and/or worry about Google.
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