Microsoft (Nasdaq:MSFT) Negotiating for Integrated Pay-TV Service

Microsoft (Nasdaq:MSFT) continues to push toward making deals to create an integrated pay-TV service which would work with their popular X-box and other devices.

Canaccord said about the initiative, that Microsoft "... is in discussions with media companies about offering a pay-TV service that would integrate with devices such as the Xbox video game console, reports Reuters. Under one plan, the company would use the Xbox to authenticate existing cable subscribers to watch shows with enhanced interactivity, similar to what pay TV operators have sought to do over the web, said Reuters. Other plans under consideration include creating a “virtual cable operator”, which would deliver content over the Internet to users who pay a monthly fee, or the possibility of creating content silos and selling more individual channels directly, such as HBO or Showtime. Microsoft already has Walt Disney’s (NYSE: DIS) ESPN on the XBox Live service, for example. Reuters’ sources said a Microsoft TV service is still early-stage and may not arrive for another year, but discussions have been productive so far. The software giant’s possible push into the online television business comes as Google (Nasdaq:GOOG), Apple (Nasdaq:AAPL) and Netflix (Nasdaq:NFLX) jockey for position in the emerging online TV business. Microsoft’s ambitions of entering this space have long been recognized, the company having previously invested in interactive television initiatives including Web TV and MSN TV set-top box software."

Microsoft closed Tuesday at $25.26, falling slightly to $0.05, or 0.21 percent.