Back in March I spotted a news article that seemed to indicate TiVo’s deal with Conax to bring the TiVo experience to Canal Digital’s Scandinavian satellite customers might have fizzled out. And last month at The Cable Show TiVo confirmed to me that the deal was effectively dead. However, neither side was making any official public statements – but that seems to have changed. A new article from Consumer Electronics Daily includes statement from TiVo President & CEO Tom Rogers which put the nail in the coffin of that deal:
In addition to focusing on small- and medium-size U.S. operators, TiVo will seek to expand distribution in Western Europe, Rogers said. But TiVo has parted with one potential partner in Telenor’s Canal Digital direct-to-home satellite service in Scandinavia, Rogers said. TiVo signed an agreement with Canal Digital in late 2010, but the company has undergone a management shakeup, including the departure of CEO Tone Krohn Clausen, and is said to have been up for sale.
“They had a big strategic process they were going through in selling the company and we decided pouring resources into a company that might be selling itself near term might not be the smartest thing,” Rogers said. “It’s not clear what they are doing and for the kind of shoulder that it takes roll out what we do, we knew that it would not be the best circumstances.”
So we finally have an explanation of what happened with that deal. It’s dead, Jim. Well, at least for now. It sounds like the door is still open if Canal Digital sorts their issues out and is still interested, but TiVo doesn’t want to get involved for now.
You might have noticed the first sentence in the quoted material, about small- and medium-sized US operators. That’s actually the main gist of the CED article. TiVo is seeing most of their traction in the US come from those operators, and not the big boys. So they aren’t putting a lot of energy into pursuing ‘Comcast-size’ deals. While TiVo’s deal with Comcast is significant, it is clear that Comcast’s focus is on their own in-house developed service, X1. While it seems that Comcast will fulfill their end of the agreement and continue to expand coverage of TiVo support for XFINITY VOD, TiVo is really a secondary offering for them. Their primary push is going to be X1, and understandably so.
Five of the largest MVPDs in TiVo-served territories – Comcast, British Sky Broadcasting, DirecTV, Dish Network and Time Warner Cable – are working on DVR strategies in-house and are unlikely to ever adopt TiVo’s software as their primary platform. I’d also add Verizon FiOS and AT&T U-Verse to that list. While TiVo may be able to collect licensing revenue for their patents from these providers, there’s little chance they’ll contribute directly to subscriber numbers. But the small- and medium-size MSOs don’t have the resources to develop their own DVRs, so they need third party vendors to fill the need – which is where TiVo comes in. They’ve already had success in the US with MSOs such as RCN, Suddenlink, Grande Communications, and more.
Of course, they have landed one major MSO as well – Charter Communications. But the deal seems to be stuck in neutral. Charter began deploying TiVo in Fort Worth, TX last November and at the time planned a“full production launch enterprise wide in the first half of 2012.” However, in February of this year they announced they they were pushing the schedule out, without providing any new time frame.
Since then we haven’t really heard much, and Charter’s TiVo deployment remains limited to Dallas & Ft. Worth, TX. Rogers stated that TiVo is “working closely” with Charter to expand their deployment into new territories. There has been some speculation, which I also heard going around The Cable Show, that Charter might be one of the early customers for the new Pace XG1 running the TiVo software. And that could account for the hold up, waiting for the XG1 to be available, but that’s just a rumor and I don’t know that I’d put much stock in it.
Check out the Consumer Electronics Daily article for yourself.