Moto buys Tut for video distribution

Motorola Inc. is spending $39 million to expand its IPTV video processing and distribution capabilities with the purchase of Tut Systems Inc.
The move gives Motorola the ability to supply service providers with the gear they need to deploy advanced video services over Internet Protocol, Asynchronous Transfer Mode or radio frequency-based networks. Tut’s products support MPEG-2 and MPEG 4 AVC video compression, as well as local ad insertion, forward error correction and real-time conditioning of video and audio.
Tut said more than 160 service providers use its products.
“This transaction brings together the telco-aware IPTV processing capabilities of Tut Systems with Motorola’s proven video delivery expertise,” stated Dan Moloney, president of Motorola Connected Home Solutions. “Together, our combined portfolio will provide service providers with next-generation solutions for delivering rich video experiences into the connected home-and out into the world.”
Motorola and other network suppliers are beefing up their mobile video offerings to support growing demand for multimedia content delivered via wireless networks.
And the demand for mobile video could grow significantly. ABI Research’s latest report states that the 2008 Olympics in Beijing could push mobile video to more than 32 million users.
Motorola’s transaction with Tut is expected to be completed during the first quarter of 2007, at which point Tut Systems will become a subsidiary of Motorola and will be integrated into the Motorola Connected Home Solutions business. Motorola said it intends to maintain Tut Systems’ operations in Oregon and California.
News of the purchase agreement didn’t faze Wall Street as Motorola’s stock traded up just 1 cent at $20.42 per share. The purchase is one of a string by Motorola in a variety of fields.