Motorola just announced that they're buying Modulus Video, a video-encoding vendor that they've been working with for the past two years.

Modulus Video is by no means a household name, so normally an acquisition like this flies under everyone's radar. But given that this is the fifth video encoding or distribution firm Motorola bought recently (after Broadbus, Kreatel, Tut Systems and Netopia), it deserves a second look.

The idea is pretty simple. Video capability is fast becoming an integral part of designing a handset. By bringing all these firms in house, Motorola can design handsets that support video more easily than before. In turn, more consumers will be able to watch mobile TV and other video-enabled services, especially as the price of entry comes down.

It's similar to what happened with camera phones. Three or four years ago, only higher-end phones came equipped with them. Now, practically every handset sold on the planet has a built-in camera of some kind. Give it a few years; with all the current trends, soon every new phone will be able to display video.

Motorola Buys Video Encoding Company Modulus Video [Reuters via NYT]