Don't expect Microsoft Corp. to unveil a Web-based Netflix-like video offering anytime soon.
The software behemoth has put on hold talks with media companies after determining that licensing costs were too steep for the business model it pictured, Reuters reported, citing people familiar with the discussions.
Redmond, Wash.-based Microsoft reportedly had been hoping to introduce a Web-based service for TV shows and movies in the next few months. But the company's plans to offer current shows and live networks on its service proved to be an expensive proposition, Reuters reported.
The field for over-the-top services like Netflix, Hulu and Dish Network's Blockbuster Movie Pass is becoming increasingly competitive, and reports continue to surface that more established tech and telecom giants want to break into the business.
A Web-based video service could be a nice fit for Microsoft, which is one of the world's most recognizable brands and already offers live and on-demand TV shows, sports and additional content in the U.S. and abroad on its Xbox 360 game console through partnerships with a number of television operators and other companies. Microsoft may one day return to the bargaining table in connection with an online video offering.
"It doesn't mean they won't be back in another iteration," a senior media executive involved in the talks told Reuters. "We'll have to wait and see."
A Microsoft spokesperson declined to comment to Reuters.
Last month, Microsoft announced a number of partnerships in the U.S. and abroad to expand entertainment offerings through its Xbox 360. For example, Verizon has introduced a service that allows Xbox Live Gold members who subscribe to its FiOS TV and FiOS Internet to use their gaming consoles to watch 26 TV channels.
