Sources say that Intel (News - Alert) plans to launch a paid TV streaming service that would provide channel packages similar to those from cable or satellite companies over the Internet. The company has already begun to invest in a number of firms specializing in services, platform software, connected devices and home networking silicon. However, analysts think that Intel will not succeed in a market that has seen little enthusiasm for similar products.

Intel’s product would reportedly feed programming to television sets, computers and mobile devices. The company has reached out to media companies as well as to cable channels, according to Bloomberg Businessweek, to discuss arrangements for obtaining the rights to broadcast shows. According to The Wall Street Journal, Intel plans to provide a TV set-top box that will stream programming as well as video on demand.

Other Internet-based cable alternatives have fallen flat. Both AppleTV and GoogleTV have barely made a dent in cable company profits. Apple (News - Alert) treats AppleTV as more of a side project, and Google has struggled to persuade broadcasters to offer content over GoogleTV. If people are defecting from cable, then they are defecting to providers like AT&T and Verizon (News - Alert), which provide TV over their fiber networks.

Additionally, Intel does not sell to customers—its focus is B2B—and has no experience in the media business. To make inroads into media, the company recently hired former BBC executive Erik Huggers. In its quest to expand outside of computers, Intel CEO Paul Otellini is trying to cut deals so that Intel processors are powering a number of products, including automobiles and mobile phones. While GoogleTV does use Intel chips, the lackluster performance of the program has limited Intel’s penetration of the TV market so far.

Intel does supply set-up processors to Comcast (News - Alert), and their relationship with Comcast could get them access to programming from NBC Universal (News - Alert), which Comcast just acquired. NBC Universal could provide Intel with access to NBC broadcast channels, USA Network and Universal Studios. However, success with ABC, CBS and cable networks is by no means guaranteed.

So far, Intel has declined to comment on its interest in streaming TV programming. Some analysts, however, think that the service could debut later this year.