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Rovi to buy Sonic for $720 million

The acquisition of Sonic Solutions, owner of the Roxio and DivX products, is intended to bolster Rovi's array of digital entertainment offerings.

Rovi's TotalGuide platform.
Rovi's TotalGuide platform, which will be augmented by Sonic's offerings.

Rovi has agreed to acquire Sonic Solutions for $720 million in a bid to beef up its digital entertainment offerings.

With the help of Sonic's content offerings, including the DivX and Roxio products, Rovi plans to broaden its range of products and services for "content owners, device makers, retailers, and operators" in the digital entertainment market.

Specifically, the company said yesterday that it plans to combine its TotalGuide content discovery service and RoxioNow, Sonic's digital-media delivery platform, which boasts over 10,000 movies and television shows, thanks to content partnerships with Universal, Disney, 20th Century Fox, and several others. The service is expected to be running on more than 30 million devices by June 2011.

Sonic's DivX digital video offering could also become central to Rovi's plans.

According to Rovi, DivX is available "in over 350 million consumer electronics devices." Moreover, the DivX player software is downloaded more than 100 million times per year, and has been started up by users 2.5 billion times since 2009. Rovi said that it plans to build upon that success and offer its "guide software and metadata" with the DivX player to bolster its advertising distribution.

Rovi's acquisition comes just a couple weeks after Sonic announced several new content partners for its DivX TV offering. Aside from content from CNET and the Associated Press, which were already available on the service, Sonic added Funny or Die content, Howcast's DIY videos, and more.

DivX TV launched in October. It's available on a range of LG Blu-ray players and home theater systems.

Rovi's Sonic acquisition price represents a 38.2 percent premium on Sonic's 30-day average per-share closing price as of December 21. The transaction requires regulatory approval to be completed, and Rovi hopes to close the deal during the first quarter of 2011.