Can Intel Make You Watch All Your TV on the Internet?

Intel (NASDAQ:INTC) wants to help you get your idiot box fix on the computer like never before. In an effort to enter the pay-television business and cash in on a massive online audience, the chip-maker has been working to create a “virtual cable operator.” The idea is to offer TV channels over the Internet through an Intel-branded set-top box in a bundle subscription similar to those sold by cable and satellite operators. But skeptics remain unconvinced.

High programming costs and the bandwidth that would be required to provide complete television channel packages over the Internet are potential hitches that make some people skeptical of the company’s plans. Bernstein analysts Craig Moffett, Carlos Kirjner, and Todd Juenger to have talked down Intel’s efforts in a report. “It sounds like they’re almost there. They’ve got the set top box concept down. Now, all they need is everything else. Content, for example,” the Bernstein note said.

Intel is still in the process of pitching to media companies, though it reportedly plans to launch by the end of 2012. WSJ said it had asked companies for rate cards detailing channels and on-demand programs.

The company last year launched Intel Media, a group with focus on TV-related services. CEO Paul Otellini has been long known to have ambitions of taking the company beyond the computer industry, but has faced some problems. In October, the company closed a group that was working with Google to develop Internet-equipped set-top boxes and TVs. Intel planned to keep supplying chips for set-top boxes used by some major operators, WSJ added.

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