CES: TiVo's Rogers: AT&T Payments Could Reach $300 Million
DVR Maker Demos Adapter That Delivers Up to Four Streams Wirelessly
By Todd Spangler -- Multichannel News, 1/11/2012 3:20:16 PM
Las Vegas — TiVo president and CEO Tom Rogers said AT&T could end up paying about $300 million to his company if the telco's U-verse TV service continues adding DVR subscribers, which would be $85 million on top of the minimum the telco agreed to pay under a patent-lawsuit settlement.
"A year ago, [analysts] were asking, 'Is your [intellectual property] enforceable and valuable?'" Rogers said in an interview. "We are now within people's ability to see how profitability can be reached."
Here at CES, TiVo is showing a prototype of an adapter for its DVRs that transcodes up to four streams of video -- including both live TV and DVR content -- and delivers those wirelessly to iPads and other devices.
"What we're showing is how you get content on any screen in the home," said David Sanford, vice president and general manager of TiVo's service provider business. "Right now consumers don't have a way to get DVR content on multiple devices."
On Wednesday TiVo released research finding that only 38% of viewing by its 2 million subscribers was live TV, with the bulk of time spent watching DVR content or broadband-delivered video. Among TiVo users who use Netflix, YouTube, Hulu Plus and other over-the-top services, live TV was just 27% of total time spent viewing.
"A year ago, people would have said this is bad for cable," Rogers said. "I think it's good, because people still want all their TV content. The overwhelming amount of [non-live] viewing is time-shifted TV."
TiVo on Jan. 3 announced the settlement of its patent lawsuit against AT&T, under which the telco will pay a minimum of $215 million through June 2018. In addition, AT&T will pay incremental recurring per subscriber monthly license fees through July 2018 in the event that AT&T's DVR subscriber base exceeds certain undisclosed levels. AT&T has declined to comment on the TiVo settlement.
The agreement with AT&T came after TiVo's landmark $500 million settlement with Dish Network in May 2011, after seven years of litigation. The key patent at issue was TiVo's Time Warp patent, U.S. Patent No. 6,233,389, which covers the simultaneous playback and recording of TV programming.
TiVo also has litigation pending with Microsoft, Verizon Communications and Motorola Mobility. Microsoft sued TiVo after the DVR company filed a lawsuit against AT&T, which uses Microsoft's Mediaroom IPTV platform.
"We viewed separating [the] Microsoft [litigation] from AT&T as a positive for us," Rogers said.
Rogers identified two primary competitors in the service provider space: NDS and Arris, which has introduced a whole-home gateway based on the Moxi set-top from Digeo.
"There are not many people who can do what we do," Rogers said. "You have to do this without disrupting the field operations side, which is damn hard."
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