Widening and tweaking the communications "pipes" used in the delivery of multimedia data to future set-top computers and PCs is fast becoming a major focus for Intel, since this will improve its chances for getting a piece of a gigantic TV replacement market, a market comprising virtually 100 percent of the households in the U.S.
With more communications bandwidth, publishers can send out more dynamic, complex content. Simultaneously, the availability of this content will prompt consumers to upgrade computers or current TV cable set-top boxes.
Under the alliance, Intel and the Fantastic Company will develop delivery systems for media-laden applications and files such as games or full-motion films. These applications will be delivered over a wide variety of "broadband" mediums, including satellite, cable, digital terrestrial signals, and digital signal lines.
Fantastic, founded in 1996, specializes in data broadcasting systems that allow publishers to deliver large amounts of content directly to PCs. The company's core products include the Channel Management Center, which allows publishers to compress data for easier transmission, and Channel Editorial Centers, a tool for branding and aggregating content.
The investment-alliance makes sense, said analysts, because it will ultimately drive demand for more complex computers and home entertainment devices, fields that Intel already dominates or has plans to attack.
"They want to proliferate their architecture and they will create an environment where that will happen," said Greg Blatnik, vice president at Zona Research. "Intel can control and predict processor power real well, but what Intel doesn't have control over is the pipe."
Still, Blatnik cautions that efficient broadband mediums chock full of florid content won't occur overnight.
"The discussions we've had with Intel on this [broadband transmissions] have revolved around the year 2002," he said.
The size of Intel's investment in Fantastic was not disclosed.
Intel is an investor in CNET: The Computer Network.