Intel pays 120 millions for patents and video codecs

Intel and RealNetworks made a crucial deal for video technology on Thursday. The semiconductor firm has paid $120 million to get a "significant" 190 of RealNetworks' patents. In exchange, Intel has agreed to team with RealNetworks to co-develop the latter's signature video codecs and will take on seven codec developers from its partner in the process.

Mobile was the focus, according to Intel senior VP Renée James. The extra development would cover a "wide spectrum" of hardware, including smartphones and ultrabooks.

For RealNetworks, the pact is a major improvement in its financial position since spinning out its Rhapsody subscription music service. With a total $183 million in cash as of the end of the summer, the online video pioneer will be getting the equivalent of two thirds of its value just from the Intel deal.

The company is best known for its RealVideo format. At one point, it was the defining video codec for the web and used by most major sites for streaming. Flash video, HTML5, and other more universal formats ended up taking over and have pushed RealVideo mostly out of the mainstream.