elemental technologies

Amazon Acquires Elemental Technologies For A Reported $500 Million In Cash

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Amazon announced this afternoon that it’s acquiring Elemental Technologies, a backend mobile video service.

It’s paying around $500 million in cash for the company, according to a new report from The Information. (Subscription required.)

Amazon didn’t immediately return a phone call or email request for comment about that figure.

The deal was orchestrated by Amazon’s highly profitable Amazon Web Services unit, which will incorporate Elemental’s technology into its cloud infrastructure services mobile video offering, says The Information.

Elemental, which makes high-speed video encoding and transcoding software to enable multiscreen content delivery across different devices, was founded nine years ago in Portland, Ore., and counts among its many customers ABC, BBC, Comcast, Ericsson, and ESPN.

According to Crunchbase, it raised roughly $44 million from investors over the years, including venture firms General Catalyst Partners, Voyager Capital, Steamboat Ventures, and Norwest Venture Partners. Others of its investors include the Australian telco Telstra, the European pay TV giant Sky, and the angel investor groups Oregon Angel Fund and Alliance of Angels.

Elemental, which will retain its brand, is led by CEO Sam Blackman, who’d earlier architected products as an integrated circuit design manager for Pixelworks.

The deal is expected to close in the fourth quarter of this year, say both companies.

At $500 million, Elemental would represent one of Amazon’s five biggest acquisitions to date. The others include Zappos, acquired in 2009 for $1.2 billion; Twitch, acquired last year for $970 million; Kiva Systems, acquired in 2012 for $775 million; and Quidsi, acquired for $545 million in 2010.