Video-conferencing company Tandberg ASA on Thursday said it would spend $270 million to buy high-definition video-conferencing company Codian Ltd. The deal is a win for Codian, but it also narrows the number of possible acquirers for LifeSize Communications Inc., which has raised $81 million to build its own high-def video-conferencing system, and Teliris Ltd., which has raised $40 million for its video-conferencing network. 

Tandberg and Polycom Inc. are the two largest pure-play video-conferencing companies, while Cisco Systems Inc. and Hewlett-Packard Co. also have video-conferencing offerings. Much of the deal activity in the sector to date has focused on Web-based communications over computers, including Cisco's $3.2 million purchase of WebEx Communications Inc. and Google Inc.'s deal earlier this year for video-conferencing software from Marratech AB.

By contrast, Codian, LifeSize and Teliris offer something much more compelling, creating an almost lifelike conferencing experience fit for boardrooms and medical consultations. Even with Tandberg out of the market for a high-def startup, the deal could force other market players to consolidate the sector. —Stacey Higginbotham

See Sept. 6 story from TheDeal.com
See Sept. 2006 story from TheDeal.com
See Feb. 6 story from TheDeal.com

Tags: telecom