May 28, 2009
TiVo Inc. (Nasdaq: TIVO) hopes to pump up its cable distribution strategy via a new tru2way -focused agreement with Comcast Corp. (Nasdaq: CMCSA, CMCSK) and a fresh distribution deal with Evolution Broadband LLC that looks to give the DVR pioneer a greater exposure with Tier 2 MSOs.
TiVo says Comcast plans to offer TiVo as the "primary DVR option going forward" in a yet-to-be-announced tru2way market. The MSO already has tru2way deployed in Denver, Chicago, and Atlanta, but, per a binding memorandum of understanding (MOU) signed last year, Comcast is also on the hook to have all its digital headends wired up for tru2way by July 1, 2009. (See Revealed: The Tru2way MOU, Tru2Way in Atlanta, and Denver, Chicago First to Get Tru2way TVs.)
TiVo has yet to unveil a tru2way device, but has already ensured that its forthcoming DVRs with tru2way on board will preserve the company's user interface as well as the cable operator's native navigation system. (See TiVo à la Mode .)
On Wednesday's first-quarter earnings call, TiVo CEO and president Tom Rogers said his company and Comcast are working on a TiVo app "that is truly compatible" with the MSO's tru2way "stack" -- a reference to the middleware component of tru2way. (See TiVo Posts Q1.)
Although tru2way is central to TiVo's future cable strategy, Comcast is presently marketing TiVo by porting the company's software to Motorola Inc. (NYSE: MOT)-made digital cable boxes. Comcast offers this in its New England region, with Chicago set to launch next. This summer, Comcast will allow TiVo subs in New England to program their DVRs remotely via the Web using the TiVo Online Scheduler. (See Chi-Town Bound?)
TiVo is also set to benefit from Comcast's all-digital project, which the MSO refers to internally as "Project Cavalry." Comcast, which has this analog reclamation project already underway in markets such as Portland, Ore., Seattle, and the Bay Area, will eventually offer TiVo's hi-def, CableCARD-capable retail box "as an alternative" to the digital adapters the MSO is presently providing to help with its all-digital transition. (See Comcast's $1B Bandwidth Plan .)
Rogers also offered an update on TiVo's deal with Cox Communications Inc. , noting only that the trials in the operator's New England properties are continuing and an initial consumer launch could occur within the next two to three months. (See Cox Tees Up TiVo Test Bed .)
TiVo will be looking to these partnerships, including a new one getting off the ground next year with DirecTV Group Inc. (NYSE: DTV), to boost its subscription totals. It ended the first quarter with 3.2 million total subs after signing up 37,000 gross adds in the period, down from 48,000 in the year-ago quarter.
TiVo is also reaching out to the Tier 2 cable market via a new deal with Evolution Broadband, a Colorado-based cable gear reseller and integrator.
Comporium Communications , an operator that's already using digital terminal adapters (DTAs) from Evolution for an analog reclamation project, is the first operator to benefit from the Evolution-TiVo agreement. It's already starting to offer HD-capable TiVo boxes to customers in Charlotte, N.C. (See Comporium Tests Positive for DTAs.)
Evolution principal Chris Egan says smaller operators are eager to offer TiVo as a set-top and to tap into the "over-the-top" broadband capabilities of those boxes to pipe in movies and other content from partners such as Amazon.com Inc. (Nasdaq: AMZN), Blockbuster Inc. , Netflix Inc. (Nasdaq: NFLX), and Walt Disney Co. (NYSE: DIS).
"We think it's a wonderful complement for the small cable operators, particularly those that don't have VoD [video on demand]," Egan tells Cable Digital News.
Comporium's the first, but won't be the last to take this route. "There's more coming," Egan says. "These smaller [MSOs] need someone to come in and integrate everything." Evolution's agreement with TiVo covers both the U.S. and Canada.
But TiVo's Tier 2 cable ambitions don't start and stop with Evolution. It also has a relationship with the National Cable Television Cooperative Inc. (NCTC) , a buying cooperative that represents more than 1,000 independent cable operators.
TiVo's overall cable play also hinges, in part, on a partnership with SeaChange International Inc. (Nasdaq: SEAC) that enables TiVo's current stable of retail DVRs to offer VoD content from the MSO without the presence of a tru2way stack. In this scenario, the box's Internet connection acts as the return path, interfacing with the cable VoD system to set up video streaming sessions. (See TiVo, Comcast Discount Targets HD Subs and TiVo Gets More Cable-Ready .)
— Jeff Baumgartner, Site Editor, Cable Digital News
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