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Report: HTC invests $40 million in OnLive

The smartphone maker takes a stake in on-demand gaming service OnLive, according to The Wall Street Journal. It also makes "strategic investment" in multimedia provider Saffron Digital.

Don Reisinger
CNET contributor Don Reisinger is a technology columnist who has covered everything from HDTVs to computers to Flowbee Haircut Systems. Besides his work with CNET, Don's work has been featured in a variety of other publications including PC World and a host of Ziff-Davis publications.
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Don Reisinger
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HTC is looking to expand its ability to offer smartphone users multimedia content.

The smartphone maker has invested $40 million in cloud-gaming service OnLive, The Wall Street Journal is reporting. Citing an HTC spokeswoman, the newspaper said that HTC's investment in OnLive will be used to help it deliver more games to players on smartphones. All told, HTC will purchase 5.3 million OnLive shares for $7.50 per share, according to the report.

OnLive currently delivers video games to PCs and Macs over the Web. The company also sells the OnLive MicroConsole, which connects to a user's television and lets them play titles through the service. OnLive offers the ability to rent or purchase games, or subscribe for $9.99 per month for unlimited access to its library of titles.

HTC and OnLive aren't really an odd couple.

Last month, OnLive announced plans to integrate its service into Vizio's upcoming HDTVs, Blu-ray players, smartphones, and tablets. The company also offers the OnLive Viewer in the App Store for Apple iPad users to see how its service works, but not actually play games. The company said at the time that the app will offer "full game play capability" at some point in the future.

HTC's decision to capitalize on OnLive's mobile focus might be a good idea. Mobile gaming is growing considerably.

In a study last year, market research firm Gartner revealed that the mobile gaming space is set for huge revenue explosion in the next few years. The firm estimated that total mobile gaming revenue around the world would reach $5.6 billion in 2010, and climb to $11.4 billion in 2014. Gartner estimated at the time that a hefty 70 percent to 80 percent of all applications downloaded to mobile platforms were games.

Gaming isn't the only thing on HTC's agenda this week. The company announced yesterday that it had made a "strategic investment" in London-based digital-multimedia provider Saffron Digital, which offers video on demand and other mobile-facing multimedia services to vendors. It partners with Samsung in the U.S., HTC said.

HTC did not release the terms of its deal with Saffron Digital, but The Wall Street Journal is reporting that it was valued at $48.6 million.