Exclusive: Intel TV creator leaves Verizon months after deal

Fri May 30, 2014 5:59pm EDT
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By Noel Randewich and Liana B. Baker

SAN FRANCISCO/NEW YORK (Reuters) - Erik Huggers is leaving Verizon Communications Inc (VZ.N: Quote) just five months after joining the company via the acquisition of the Intel Corp (INTC.O: Quote) “OnCue” streaming service he developed, signaling the communications giant’s waning interest in providing an Internet-delivered TV service.

The former BBC executive, who told Reuters on Friday he is departing the company, had worked on OnCue for Intel for more than two years before Verizon bought it in January to accelerate a push into video services, including TV channels delivered over the Internet, known as an "over the top", or OTT, service.

While other companies have been talking up their plans to deliver such a service, a source familiar with the matter said that Verizon was now moving away from the OTT strategy and that the departure of Huggers, who was a proponent of an Internet-only service, reflected that.

A Verizon spokesman confirmed Huggers' departure and in regards to its strategy said, “We obtained a strong combination of technological and personnel assets from Intel Media. We intend to strategically utilize the OnCue technology and talent going forward to grow our business. That has not changed."

Verizon had previously said OnCue would help it offer video over its Fios fiber-optic infrastructure as well.

Seen by some as a bold attempt to revolutionize TV and others as a distraction from Intel's chip business, Intel CEO Brian Krzanich pulled the plug and put the unit up for sale before it was launched.

Intel's retreat from streaming TV was a disappointment to people in Silicon Valley who hoped the technology company could break open a market tightly controlled by a handful of cable and entertainment conglomerates.

With the acquisition, Huggers and many of his employees moved over to Verizon, where he hoped to launch the service to consumers. But he told Reuters he advised his staff on Thursday that he was leaving the company.   Continued...

A Verizon logo is seen during the International CTIA WIRELESS Conference & Exposition in New Orleans, Louisiana May 9, 2012. REUTERS/Sean Gardner