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ActiveVideo Networks Acquires Tag Video Gaming Resource

5/05/2010 12:25:09 PM Eastern

San Jose, Calif.
- ActiveVideo Networks said
Wednesday it has acquired Tag Networks and will be adding the firm's scalable
network game platform to the Active Video CloudTV interactive streaming
platform.

The newly combined
entity will leverage both companies' technologies "to create a powerful and
versatile platform that supports both casual and twitch or fast-motion games,"
Active Video Networks said in a statement disclosing the deal.

Tag's portfolio of licensed titles will
enable ActiveVideo to develop new revenue streams for cable system operators
and the CE industry through the delivery of advertising-supported casual games
to any digital set-top box or CE device.

ActiveVideo
currently serves approximately 5 million homes and anticipates that the
combined benefits of Tag and CloudTV will significantly drive new adoption.

"We believe that
the games category, which exceeds $25 billion, is among the most significant
growth opportunities for our cable, programmer and CE manufacturer customers,"
said Jeff Miller, ActiveVideo Networks president and CEO. "Combining Tag's
advanced games platform with our own industry-leading cloud platform provides
our distribution and programming partners with a single, robust solution for
delivering games, social communities, iVOD, Internet video, advanced
advertising, interactivity and commerce to TVs around the world."

In conjunction
with the acquisition, Tag Networks' management team and staff have been
relocated to ActiveVideo's corporate headquarters in San Jose.

Sangita Verma, CEO
and founder of Tag Networks, and Robert Craig, chief creative officer and
founder, will serve as president of Tag Games and chief creative officer of Tag
Games, respectively, for ActiveVideo Networks; Tag chief technology officer
Cliff Mercer will serve as ActiveVideo Network's senior engineering VP.

"Tag and
ActiveVideo Networks have successfully collaborated for many years and together
we have proven the value of games as drivers of television interactivity," said
Verma. "Now as a part of the ActiveVideo team, we're looking forward to
expanding our vision and making the Tag games platform available to other games
developers and content owners."

Earlier this year,
the Tag games-on-demand channel was said to be the stickiest channel on Oceanic
Time Warner Cable, according to TNS set-top box data.

The TNS Average
Daily Minutes (viewed) data for 2009 indicated that Tag households averaged
116.5 minutes per day in engagement with the channel.

Tag Networks also
recently announced that it had established an industry record for streaming
games density and scalability by supporting 2,000 concurrent MPEG game streams
at 1.25Mbps with a single off-the-shelf 1RU dual quad-core server,

The Tag platform
was said to be deployed to hundreds of thousands of U.S. households via digital cable.
Additional deployments and trials are slated over the next 12 months.

The ActiveVideo
platform combines Web video, Web 2.0 functionality and traditional television
applications, to deliver an interactive environment of both linear and
broadband programming. The system includes rich graphical user interfaces
optimized for TV and remote control navigation; social networking; personal
media; niche content; and targeted, actionable advertising.

The platform works
with both legacy and next-generation digital set-top boxes and
broadband-connected devices, ActiveVideo Networks said.

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