Samsung Buys Video Software Startup Boxee for $30 Million

Samsung confirmed it has purchased Boxee, an Israeli startup developer of streaming media devices and services, for $30 million, a move the Korean company believes will bolster its software portfolio for its Internet-connected televisions and home entertainment lineup.

The deal, for Boxee’s assets and key employees, was first reported by the Israeli web site, The Marker, which said Samsung paid less for Boxee that the amount originally invested in the company. Samsung declined to offer how much it paid for the developer but the $30 million figure that’s emerged is slightly more than the $28.5 million in funding Boxee reportedly has received, including the $16.5 million in landed two years ago, but hardly a windfall for the company’s founders and investors.

Boxee was said to be looking for another $30 million in backing but, instead elected to sign on to the Samsung deal, as reported here. According to accounts, Boxee will retain all 45 of its employees and still will be led by chief executive Avner Ronen after the transaction closes

“Samsung has acquired key talent and assets from Boxee,” a Samsung spokesperson said, in a statement. “This will help us continue to improve the overall user experience across our connected devices.”

It’s not clear how Samsung will use Boxee’s technology in its smart TV portfolio. Of late, the vendor has touted its smart TVs, saying it will equip most of its TV lineup to connect to the Internet. But, similar to other, early smart TV toe-dippers, including Apple (AAPL), its software hasn’t kept pace with the quality of the hardware, dinged for its lack of user intuitiveness and clunky operation. Samsung is said to believe that Boxee, well-regarded for its digital video viewing software with a set-top device called the Boxee Box to run the software, will smooth over its move into the smart TV market.

Boxee’s technology hasn’t made the company too many friends among cable TV providers, such as Comcast (CMCSA) or Time Warner (TWC), mainly because it’s those companies who have the most to lose from users streaming content free from the Internet rather than paying top dollar for it.

Last October, Boxee rolled out a cloud-based DVR box, called the Boxee Cloud DVR, with a better user interface than cable boxes, and offering users the ability to record and watch shows from the cloud through a variety of devices.