And IBM is continuing on its endeavour to foray deeper into the domain of cloud computing by acquiring live video streaming service Ustream. Earlier reports had pegged that the deal, which would value Ustream at around $130 million, was in the making. A day after the reports, the deal has been finally confirmed. The exact terms of the deal are yet to be disclosed by either companies.
The acquisition advances IBM’s growing efforts to set a firm footing in the cloud computing sector. Ustream, which was founded nine years ago, will aid the blue chip maker in its efforts. Following the deal, IBM has disclosed that it will be launching a new Cloud Video Services unit soon.
The present CEO of Ustream, Brad Hunstable is not expected to helm the company under IBM. The torch will be passed down to general manager Braxton Jarratt, who is set to take over the responsibilities. It is unclear if Hunstable will be allowed continue in some other role.
Ustream has a healthy following of around 80 million viewers, as claimed by the company. The live video streaming service has the likes of Facebook, NASA and the Discovery Channel among its clients. The new Cloud Video Services being set up by IBM will now have Ustream along with the recently acquired start-up Clearleap. IBM is on an acquiring spree to strengthen its new unit in order to substitute the fall in sales in the desktop market. IBM believes that the cloud based video sector is $105 billion strong and is growing at a rapid rate.
The around $130 million deal will see some of the staff at Ustream being retained and working at the new unit at IBM. The deal’s value is bleak in front of the amount shelled by Amazon – $970 million to acquire Twitch.
Ustream has earlier worked with IBM in 2014 for the latter’s video streaming project, the Bluemix cloud platform.
“Through this latest acquisition and the creation of a new cloud business unit, IBM will provide an end-to-end suite of digital video solutions for the first time under one roof,” Jarratt stated about the deal. “As a result, clients will be able to take advantage of every stage of the video life cycle through advances in customization, digital access, visual analytics and more, all to enable the consistent delivery of video content globally.”
The deal benefits Ustream overall, which has raised $49 million till date. The company also saw an investment of $33 million from Softbank in 2011.
Ustream acquisition is the latest in IBM’s acquiring spree, which had announced that it intends to spend a whopping sum of $20 billion to acquire prospective companies.