IBM has confirmed that it has reached an agreement to acquire the provider of video streaming Ustream. No official figures about the acquisition were provided but the magazine Fortune leaked the news on Wednesday, providing a value of $130 million. For IBM the point of the deal is to add another service to its business cloud offers, one of the fast growing sectors and not just for IBM.

Ustream was launched in 2007 and over the years grew a lot adding streaming channels live and on demand. Today its clients are companies and institutions of various types ranging from NASA to Samsung, from Facebook to Nike. Ustream’s streaming services are also used by politicians for on line speeches and artists to perform shows on the Internet. It’s estimated that a total of about 80 million people each month watch Ustream’s videos live and on demand.

Ustream’s acquisition by IBM may be surprising but we’re talking about a company that for years has been gradually moving away from selling hardware that is high-level and is investing in new technologies. For IBM as for other companies cloud services are becoming increasingly important so a cutting edge offer is what it takes to beat the competition and boost revenues.

It’s no secret that in recent years the IBM revenues has been continuously falling down. However, the company doesn’t merely cut branches of its activities but kept on developing new technologies and in 2015 was again the company with the most recognized patents.

In its new strategy, IBM has created the Cloud Video Services business unit to provide services that go beyond simply offering videos in the cloud. The idea for ​​IBM is to offer the opportunity to develop business applications around video services. The simple video streaming was only the first phase but in the future there will be more and more sophisticated applications of these services such as telemedicine.

That’s why an already established reality such as Ustream can become an important part of a business service offer by IBM as part of Cloud Video Services. According to Braxton Jarratt, who will lead the new business unit, the market for cloud-based video services will exceed $100 billion by 2019 and IBM wants to be a leader in this branch.