DoCoMo takes 35 per cent of PacketVideo

Japanese carrier NTT DoCoMo on Sunday acquired a 35 per cent stake in multimedia software firm PacketVideo, owned by wireless broadband vendor NextWave Wireless.

DoCoMo spent $45.5m in cash on the acquisition, which will strengthen the Japanese giant’s position in music and video mobile services in Japan.

The two companies have an existing relationship going back to 1998, which has seen PacketVideo’s technologies incorporated into multimedia applications on DoCoMo’s FOMA 3G network.

DoCoMo has deployed PacketVideo’s multimedia player on more than 90 handset models, and the Japanese firm said the extended partnership will allow it access to increasingly advanced mobile application technologies.

But the news does note bear so well for NextWave. It looks like the firm is struggling under the burden of debt and is desperate for cash. Back in January, the management of mobile broadband player IPWireless bought back 75 per cent of the company from former parent NextWave.

NextWave purchased the UMTS-TDD kit supplier for $100m in April of 2007. Under the deal, IPWireless returns to being a private company that will be led by the entire management team that originally went to NextWave. NextWave will retain a minority ownership stake in the firm.