IP Democracy: Tivo's Rogers: We're No Longer an Island

Some companies are destined for niche status, if not oblivion, simply because their technologies, once popularized, are easily replicated by competitors. I thought this was the case with Tivo, the pioneer of digital video recording.

Over the past four or five years, the basic functions of digital video recording have been reengineered by cable and satellite companies and built into video set-top boxes, potentially making the need for an extra unwieldy Tivo box superfluous for most consumers. And, indeed, Tivo has been on the downswing…until recently.

Under the guidance of CEO Tom Rogers, Tivo is pulling out all the stops to survive. Speaking yesterday at Citigroup’s Entertainment, Media and Telecommunications Conference (webcast here), Rogers recapped the company’s turn-around strategy, one that primarily centers on partnerships that are transforming Tivo’s go-it-alone status into technology alliances.

“Twelve to eighteen months ago we were very much viewed as an island,” Rogers said. “Now we’re very much a part of a number of companies’ plans weaved into the media landscape.”

Perhaps the most important deal that could rescue Tivo is its pact with top cable operator Comcast. Comcast has agreed to deploy a Tivo-enabled set-top box starting this year (which was heavily promoted at CES.)

Beyond the notion of getting inside cable and satellite set-top boxes, Tivo is aiming to serve as an integrated gateway of sorts for all kinds of video content. “We’re after something distinct,” Rogers said, which “is to have a wholistic, integrated menu no matter where the programming is coming from.” The goal, and it’s going to be a challenge given the burgeoning number of rivals seeking to do the same thing, is to offer “one simple interface to have all your TV programming in front of you right where you want it.”

If all else fails, Tivo has some secret weapons: its patents. The company already won a huge victory in its patent infringement fight with DBS provider EchoStar (although the effect of that ruling has been stayed pending appeal). Rogers hinted at a more active patent litigation strategy. “That litigation is over one patent, the time warp patent. We have eighty other patents in our portfolio.”

Tivo has stanched the loss of customers by its decision to subsidize the cost of the Tivo box to maintain and gain market share. This gambit has worked well by ensuring that enough current generation Tivo boxes are in the field so that the company can begin experimenting with new and different applications.

But, cheap or free Tivo boxes could soon become a thing of the past. “We’ve pursued an approach that is heavily subsidizing the box. We did that because we wanted to start talking about features when we decide to start advertising,” Rogers said, referring to the fact that Tivo has undertaken almost no marketing or advertising initiatives recently. “We need to evaluate how we’ve done and decide if there is a better way now that” the new boxes are out in the field.

Posted by Cynthia Brumfield on January 10, 2007 12:05 PM to IP Democracy