Microsoft sells RealNetworks stake

Microsoft has announced it will sell its minority stake in RealNetworks, the firm that accused the Microsoft of sabotaging its media streaming player. But Microsoft inists the pitched battle the two companies fought earlier this year over their competing media players has nothing to do with its decision. 'Microsoft and RealNetworks are each developing exciting technologies, but the rapid pace of innovation and our competing visions for streaming media means our investment in RealNetworks no longer makes sense,' said a statement.

Microsoft has announced it will begin selling its minority stake in RealNetworks, the Seattle firm that accused the behemoth of sabotaging its media streaming player.

Microsoft told RealNetworks in June that it planned to sell its 10% stake in the company, but the two sides could not work out a deal and now Microsoft will sell its stock on the open market, according to a statement from Microsoft.

"Microsoft and RealNetworks are each developing exciting technologies, but the rapid pace of innovation and our competing visions for streaming media means our investment in RealNetworks no longer makes sense," Microsoft Chief Financial Officer Greg Maffei said in a statement.

In its statement, Microsoft made no mention of the pitched battle the two companies fought earlier this year over their competing media players. "They are not related at all," Gary Schare, lead product manager for Windows media technologies, who said that that Microsoft decided to get rid of its RealNetworks investment in March.

In July, RealNetworks Chief Executive Officer Rob Glaser, a former Microsoft executive, testified before the U.S. Senate Judiciary Committee that Microsoft intentionally "broke" his company's RealPlayer G2 software. Microsoft angrily denied the charge, claiming instead that it was a bug in RealPlayer that was the problem.

Schare also said format compatibility and interoperability problems led to the breakup.

"We already have been competing pretty openly out in the market," Schare said. "They are a Windows ISV, and we will continue to support them as we would any Windows ISV, as we also compete with them in the area of streaming media."

RealNetworks officials were not immediately available for comment.

Microsoft Corp., in Redmond, Washington, is at www.microsoft.com. RealNetworks Inc. is at www.real.com.

(Bob Trott, based in Seattle, is a senior editor at InfoWorld.)

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