TiVo is Alone at the Top

Posted on 06 March 2008 Tags: Home Entertainment Gadgets

TiVo

For a company that continually loses money and is hated by advertisers, why are they the best game in town? For one, they were first to create the “time shifting” concept for digital recorders. Yes, there were others to do this (Replay TV) but TiVo, made it easy to use and locked up their software with a bunch of patents.

That’s not, of course, an earth-shattering idea; VCRs have been doing this for decades. Tivo’s edge is simple but critical: it’s easy to use. As a result, the company is now on the very short list of corporate brand names – like Google, Xerox, FedEx, and Photoshop – that are widely used as verbs.

If you don’t believe patents are worth much, ask Dish Networks. They tried to circumvent TiVo’s patents and lost and will now have to pay to TiVo to keep there DVRs working. DirecTV has paid TiVo for years, first to license the software and then of late to “maintain” those boxes while they put out their own branded DVR.

Rather than risk infringing on Tivo’s strong patents, cable companies will have little choice but to forge agreements with Tivo in order to provide their customers with DVR capabilities.

Says Westerfield: “Pay-TV operators who have not yet properly licensed the right to provide DRV services in the vein set forth by Tivo’s patents might well be at risk of patent infringement claims. Therefore, in due time, we think that nearly all pay-TV operators will review their risks and opt to legitimize their DVR offerings.”

Comcast and Cox have already said they will provide customers with set top boxes using TiVo’s technology, and others seem likely to follow.

TiVo has made up with advertisers and won the battles in court. Maybe now, they will finally get to reap the reward others have made at their expense.

[via Fortune]

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