With CES 2015 being an indicator of how 4K video is set to explode, NeuLion buys up DivX for 63 million dollars

by on January 5, 2015

Stephan Jukic – January 5, 2015

The online video streaming company NeuLion has decided to buy DivX for just under $63 million dollars according to sources.

NeuLion itself is a major video streaming platform management company and has already inked deals with other corporate giants like Microsoft, with which it made a deal to help deliver high quality video streams to the software giant’s Xbox One platform. Part of this involves the ability to broadcast live NFL games at a much smoother 60 frames per second, which is twice as much as the frame rate available to traditional TV broadcasters during live events.

DivX, NeuLion’s soon-to-be new possession, has a very powerful reputation in the world of digital  media thanks to its famous and extremely popular codecs, which also share the name DivX. What this codec does is allow very large video files to be compressed down to smaller sizes while retaining a relatively high level of quality and image clarity.

Another example of the powerful divX technology at work is the H.274 codec, which was designed to shrink digital videos down so that they’re only half the size of the comparable MPED-2 format clips that are often stored on DVDs.

The DivX technology has also been licensed around to numerous electronics and media companies that include giants such as Samsung and LG.

Now, what makes this entire transaction so interesting as far as NeuLion’s future with 4K resolution goes is the fact that DivX is the company behind the now extremely useful HEVC (H.265) codec that is being used by numerous streaming media providers to compress and transmit 4K ultra HD signals to their subscribers.

Users of the latest generation of HEVC include Netflix, Amazon Prime Instant video and Ultraflix, all of which depend on the codec to send their 4K ultra HD movies and TV shows to customers around the world.

4K Streaming services like Amazon Prime Instant Videoall use HEVC, which was designed by DivX

4K Streaming services like Amazon Prime Instant Video all use the HEVC codec, which was designed by DivX

This codec and its future potential are the key to NeuLion’s interest in DivX. Considering the rapid growth of 4K content and increasing sales of 4K TVs, the company is seeing the possibilities that go with being in control of the very HEVC compression system that these ultra HD technologies rely on.

In fact, the latest press release by NeuLion made a specific reference to 4K by mentioning the “global shift” that the technology is causing to video and over-the-top services. As NeuLion itself stated, “We are extending our franchise and bolstering our capabilities with our acquisition of DivX’s entertainment and consumer electronics customers, advanced video enabling technology products and expansive geographic research”.

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