Redmond, Washington -- Initiating its broader digital TV strategy, Redmond, Wash.-based software maker Microsoft announced that it has signed a deal to acquire VideoSurf Inc., a San Mateo, Calif.,-based provider of technology that allows users to conduct visual searches through large volumes of video content, such as movies and TV shows.
Terms of the deal were not announced, but according to various sources and TechCrunch reported that the price was just below $100 million. Though, neither Microsoft nor VideoSurf has confirmed the news through official channels.
Microsoft said, to begin with it plans to incorporate VideoSurf's technology across its entertainment platform, specifically to enhance the search and discovery of its Xbox Live service, so members can sift through video content stored on the gaming and entertainment service.
“Over time, as we consolidate VideoSurf's technology into our system, we are excited about the potential to have content tagged in real time to increase the speed and relevance of the search results,” said Alex Garden, director of Xbox Live for the Interactive Entertainment Business at Microsoft. This acquisition will also make it easier for its extensive network of video partners
to take advantage of advanced features such as voice search enabled by Kinect for Xbox 360, he added.
Interestingly, VideoSurf's technology “recognizes” frames inside videos and interprets them to make discovering content fast, easy and accurate. It can be enforced as a back-end service, as it currently offers on its website, and also operates as a stand-alone mobile service.
Also, Microsoft said that this holiday we will introduce voice search across our entertainment partners on Xbox LIVE. In fact, the company says that VideoSurf's visual search competency would go well with the voice search technology that Microsoft recently bundled with Xbox Live through its Kinect control unit. Kinect allows users to simply speak the name of the title they are looking for in order to locate it online.
Moving further, the software maker is in the process of introducing around 40 global TV and entertainment providers to Xbox LIVE, including Bravo, Comcast, HBO Go, Verizon FiOS and Syfy in the United States; BBC in the U.K.; Telefonica in Spain; Rogers On Demand in Canada; Televisa in Mexico; ZDF in Germany; and Mediaset in Italy.
“Microsoft's Interactive Entertainment Division is at the leading edge of connected entertainment,” said Lior Delgo, chief executive officer and co-founder of VideoSurf. “We are incredibly thrilled to be working together on our mutual passion for creating amazing consumer experiences and reinventing how consumers search, discover and enjoy content on their televisions.”
The California-based startup, which was established in 2006, offers a back-end “computer vision” technology that scans videos to identify images, thereby doing away with the need to refer back to metadata for the sake of easier discovery.
VideoSurf currently touts more that 50 million users and runs a consumer-oriented website that enable users to search videos posted on Hulu, CNN, Fancast, DailyMotion, and other content providers' sites, which could be regarded as a would-be rival to Google's YouTube, which operates as a huge video search engine separately from the Chocolate Factory's main homepage.
In addition, VideoSurf also offers Android and iPhone apps. Under Microsoft, it is likely the company will also produce an app for Windows Phone 7. Certainly, Microsoft has failed to reap benefits out of its reinvigorated search estate Bing, so perhaps this acquisition--which TechCrunch suggests cost Redmond $70m--will help the company grab a larger video-viewing audience.
Nevertheless, VideoSurf is the most recent in a string of acquisitions spree led by Microsoft, which was sitting on about $57 billion in cash and equivalents as of the close of its most recent quarter. Many of its recent acquisitions were, including its $8.5 billion deal for Skype, have involved companies that produce products or services that help individuals more easily use and find information on their computers and connect with others.
According to comScore stats released in September, Bing is holding onto a 14.7% share of the search market, while Google continues to dominate with a 65.3% share.