Nokia has agreed to sell its IP video business to Volaris Group, a Toronto-based software company.
Under the deal, Nokia's video product portfolio - including its caching and streaming products, origin and storage technology, and stream personalization software - is expected to move to Volaris.
Volaris will then launch as a new pure play streaming technology company, Velocix, operating as an independent business within Volaris Group's Communications & Media portfolio, the Finnish vendor said in a company statement.
Nokia said it will remain a minority shareholder in the new entity and "continue to play a critical role in supporting the company's growth".
The planned deal is expected to close during Q4 2018, subject to customary closing conditions. Financial details are not being disclosed.
Nokia also said it will become a global channel partner for Velocix, enabling it to continue to sell and support Velocix video solutions.
Nokia will maintain certain elements of its video unit, including integration business and associated employees, to provide continued support for existing customers. The majority of Nokia's IP video business employees are expected to transition to Velocix, the company added.
"We are excited to be part of the new company under the Velocix brand that set out to transform the video landscape back in 2002,” said Paul Larbey, head of the IP Video Business at Nokia.
“Through several acquisitions the name changed, but the purpose remains the same: to enable big changes in the video market, to make video more personal and to enable a highly compelling entertainment experience for consumers on every screen."
Basil Alwan, co-president of IP/Optical Networks at Nokia, said video is playing a very important role in customers' strategies - both as it relates to their services and the demands it places on their networks.
“Meanwhile, the technology behind video - including user experience, content packaging and delivery - continues to go through meaningful shifts. Our new partnership enables us to adapt and grow in this important period; together we can better navigate change while providing continuity for our customers," Alwan noted.