Posted August 5, 2009 9:22 am by with 5 comments

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I wouldn’t hold your breath, but there’s a chance we’ll soon see the end of pixelated videos on YouTube. Google has today announced the acquisition of On2 Technologies and its portfolio of video compression technology. The $106.5 million deal could signal that we’ll soon see better compression technology used at YouTube– which means those videos that look great on your desktop, will still look great when they get to YouTube.

“Today video is an essential part of the web experience, and we believe high-quality video compression technology should be a part of the web platform,” said Sundar Pichai, Vice President, Product Management, Google in a statement. “We are committed to innovation in video quality on the web, and we believe that On2’s team and technology will help us further that goal.”

But wait! We’re in a recession, how can Google afford to pay $106 million for compression technology? Easy! It just offloaded the remnants of its failed Google Radio division to software firm WideOrbit. According to TechCrunch:

WideOrbit is taking over several assets of Google’s radio business, namely Google Radio Automation, Maestro and SS32 automation products. The company, which is backed by at least $34.5 million in venture capital, commented on the closing of the deal saying that it was looking to expand its product portfolio and taking over Google Radio’s assets was a key step in that process.

So to recap: video is still hot, radio, not so much.