The agreement calls for CNN to promote Intervu across the spectrum of its television and Web sites.
Intervu will provide fee-based Internet video management and delivery services for three years to most of the Web properties owned by Time Warner subsidiaries CNN and Turner Broadcasting System, the company said.
"We are excited to have CNN as a shareholder, and we look forward to building our alliance as CNN's needs for streaming media services grow," Harry Gruber, Intervu chief executive, said in a statement.
Investors reacted favorably to the announcement, pushing Intervu's stock up 12.56 points, or 19.76 percent, to 76.13.
Today's deal could signal a subtle shift in strategy, as Intervu seeks to establish greater brand name recognition without displacing its established customer relationships.
As other players in the streaming
at a glance
HQ: Solana Beach, California
CEO: Harry Gruber
Vice chairman: J. William Grimes
Annual sales: $1.71 million
Annual income: ($15.71 million)
Date of IPO: November 1997
Source: Bloomberg 11/10/99
Working behind the scenes, Intervu is ready to step in at virtually every point in the process of streaming media on the Web, from production to encoding to building audiences and, perhaps most critically, for greasing the notoriously creaky wheels of the Internet for bandwidth-intensive audio and video.
But the road has not been completely smooth for Intervu--the company has yet to earn significant revenue and saw its stock languish earlier this year. And it faces daunting competition from its better-known brethren, such as RealNetworks and Broadcast.com, both of which are in stronger financial positions.
Today's announcement could help put the Intervu in a better competitive position. The deal builds on Intervu's relatively long-standing relationship with CNN, which goes back to early 1998. Since then, Intervu has been providing CNN.com's live video streaming of breaking news events, including President Bill Clinton's grand jury testimony and Senate impeachment trial.
"We are extremely pleased that CNN's relationship with Intervu has grown into a broader alliance," Bill Burke, CEO of news and information for Time Warner Digital Media, said in a statement. "A growing number of CNN.com's users are accessing both live and on-demand video, and we believe that the demand for Internet video content will increase dramatically."
Intervu also has a deal with CNET to provide all of its streaming services. CNET is the publisher of News.com.
News.com's Paul Festa contributed to this report.