Ustream, has customers which include NASA, Samsung, Facebook, Nike and Discovery Channel offers both live and on-demand video to about 80 million viewers per month.
IBM not say how much it paid for the company. Fortune magazine claimed that the transaction could be valued at $130 million.
Big Blue has been shifting away from hardware by selling low-margin businesses such as low-end servers and semiconductors to focus on high-margin products such as cloud-based services, mobile security and big data. So far the new businesses have so far failed to make up for revenue lost to divestitures.
The company reported on Thursday that revenue dropped to $22.06 billion in the quarter ended Dec. 31 from $24.11 billion a year earlier. However, revenue from the cloud business jumped 57 percent to $10.2 billion.
Ustream, which is headquartered in San Francisco, will be part of IBM’s newly-formed IBM cloud video services unit, currently led by General Manager Braxton Jarratt.