Intel Crop, world's top chipmaker, is now stepping into media market. The company is planning to launch an Internet television (online television streaming service) this year.

Intel is shifting into an unfamiliar and costly market in which the company has no experience and relationships. Erik Huggers, vice president and general manager of Intel Media, said that Intel was currently negotiating deals with content providers.

"We have been working for (the past) year to set up Intel media, a new group focused on developing an Internet platform," said Huggers. "It's not a value play, it's a quality play where we'll create a superior experience for the end user."

Intel plans to offer smaller bundles of contents to consumers than those currently offered by cable operators, Hugger told the AllThingsDigital in "Drive into Media" Tuesday.

Intel has struggled to get its virtual television service off the ground. Major media content providers were unwilling to let the company unbundle and license specific networks and shows at a discount to what cable and satellite partners pay, according to sources.

Hundreds of Intel employees' families are already testing a set-top-box, which Intel will be selling as a part of the service, he says. The employees are testing the device's user interface, sound and picture quality and other features.  

Intel's set-top-box will also have camera that will be used to automatically guide contents and ads towards specific users.

"There's a scenario where the TV recognizes that it's you and says 'Hey, I know what you like. I know what you want to watch', versus the environment we're in today where the TV literally is not interested in you at all," Huggers told Reuters in an interview. 

With inputs from Reuters.

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