Video software

TiVo Starts Thinking Outside the Box

TiVo Inc. (Nasdaq: TIVO) has discovered a way to embed its software and user interface inside digital TVs without traveling the tru2way path -- just go direct to the source of the equipment itself.

TiVo's first user interface deal not to involve a discrete set-top box is coming way of Best Buy Co. Inc., which has agreed to integrate TiVo's software into some of its own Insignia-branded, broadband-connected televisions. (See TiVo Gets Inside Best Buy TVs.)

Best Buy, which also sells TiVo DVRs, including the new Premiere line, said it will use TiVo's non-DVR software in Insignia sets to help consumers search for and feed in video content without the hassle of dealing with multiple devices, wires, and remotes. (See TiVo 'Premiere' DVRs Go Retail.)

But there are still several questions that the companies have left unanswered. While integration development is underway, neither company is saying when these new TiVo-powered Insignia sets will hit retail. A TiVo official, meanwhile, declined to say if consumers will need to pay a separate subscription or which of TiVo's over-the-top video partners will be included in the Insignia TV offering. TiVo's broadband-fed DVRs already provide access to several content partners, including Netflix Inc. (Nasdaq: NFLX), Amazon.com Inc. (Nasdaq: AMZN), and Blockbuster Inc. .

Such decisions may ultimately reside with Best Buy, which is developing its own broadband video storefront. (See New TiVo DVRs Built for Web & Cable Content and Best Buy Storefront to Land on Samsung, LG HDTVs.)

For TiVo, the deal will give it another way to extend its brand and a component of its service directly to consumers. It also represents the latest attempt by TiVo to build its software business without relying solely on standalone TiVo hardware.

Among recent examples, Technicolor (Euronext Paris: TCH; NYSE: TCH) is porting TiVo's software into a box tagged for international distribution with pay-TV service operators, and UK-based MSO Virgin Media Inc. (Nasdaq: VMED) plans to use TiVo software to power a new line of DVRs and non-DVRs made by still-unnamed set-top partners. TiVo, despite its historic complaints about tru2way's licensing and certification requirements, is also developing a version of its user interface that can run on tru2way boxes. (See As TiVo's World Turns , TiVo Coming to Virgin's Non-DVRs, Too, TiVo Gives Cable Both Barrels , and TiVo Building tru2way Version of New Interface.)

The Best Buy/Insignia deal also looks like a hedge against Google (Nasdaq: GOOG)'s coming Web-TV service. (See Google TV Comes Out, the World Tunes In .)

But it's too early to say if the Insignia connection will help the company shore up its flagging subscription numbers. It lost 730,000 subs during its last fiscal year, netting 2.6 million as of January 31, 2010.

TiVo reports first-quarter results this afternoon, when company execs are expected to flesh out the Best Buy agreement in further detail.

Best Buy does not break down how many Insignia-branded TVs it has sold. However, consumer electronics made up 39 percent of Best Buy's domestic revenues for the fiscal year ended Feb. 27, 2010.

— Jeff Baumgartner, Site Editor, Light Reading Cable

Jeff Baumgartner 12/5/2012 | 4:34:45 PM
re: TiVo Starts Thinking Outside the Box

Nothing earth-shattering came from yesterday's earnings call; mostly a rehash of TiVo's existing and new deals, and an update on the coming en banc hearing tied to TiVo's patent squabble with Dish (TiVo's still disappointed about that).

Same story on subs... they are down again -- ended the period with 2.5 million, versus 2.6 million in the previous quarter, so  TiVo's not getting much help yet from its newer deals with the likes of Comcast and RCN.  RCN, however, just started offering TiVo in two markets, NYC and Washington, DC. 

Financials: revenues were up more than $6 million, to $61.4 million, versus a year-ago, but not enough to avoid a net loss of $14.2M. JB


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