TiVo Alticast last month announced that they will work together to make it easier to bring TiVo’s software and services to set top boxes. Alticast is a vendor if middleware for Java-based DVB-MHP, OCAP/tru2way technology and Blu-ray Disc Java (BD-J). They’re all ways to implement software independent of the host hardware – both tru2way and BD-J evolved out of MHP (Multimedia Home Platform). While all Blu-ray players support BD-J, and in the US OCAP/tru2way is deploying on cable systems (and the similar ACAP is intended for ATSC broadcast receivers), in most of the world MHP dominates.

Why is this significant? Well, based on the press release I think this signals a coming push by TiVo to leverage the work done for the Comcast & Cox deployments in the US to bring the TiVo interface to an assortment of set-top boxes worldwide:

“Teaming with Alticast allows global video providers to offer the unique combination of TiVo’s award winning user interface, advertising solutions, and broadband television functionality on set top boxes running Alticast’s industry standard embedded software for ITV applications,” said Joshua Danovitz, Vice President and GM of International at TiVo. “We hear from cable, satellite and IPTV operators around the world that they want better middleware solutions capable of quickly bringing TiVo applications to market and Alticast is in the pole position to fulfill this need. We look forward to their cooperation in making the TiVo experience available on a broad range of platforms, both in the United States and around the world, similar to the way that we have developed platforms for Comcast and Cox.”

I’ve been saying this for a while, that having the OCAP/tru2way version of the TiVo system could have an impact far beyond the US cable market. Having a portable implementation will allow TiVo to partner with hardware vendors and service providers worldwide. Working with Alticast should help get TiVo in the door, as well as smoothing the implementation issues. As TiVo has said that all tru2way cable DVRs in the US are potential TiVo systems, now, in theory, any DVR running MHP, or combo Blu-ray/DVR units, are potential TiVo systems.

Welll, in just under 10 hours I should be on a plane to Las Vegas, NV for CES. The show properly is Thursday-Sunday, but there are press events Tuesday and Wednesday which I’ll be attending. During the show itself I’ll be splitting my time between working Sling Media’s booth and trying to visit other vendors as a blogger. As is usual for me, my first victim, er, target of the show will probably be TiVo. Since I’ll be working half the show my time for seeing the rest is cut in half, but I’ll try to do what I can.

Going into this CES I’m not sure what the big deal is going to be this year, if there is one. The economy is down and I haven’t really felt any particular buzz about any given area of the market. HDTVs get bigger while getting thinner and faster (refresh rates). We may see some interesting 3D technologies which will start to enter homes in the next few years. Palm is expected to announce Nova and new hardware, but I’m not excited. I was a die-hard Palm OS user for many years, since 1998, and still carry a Treo 680. But after five or more years of waiting for Palm OS 6 Cobalt Nova I just don’t feel that inspired. I’m already focused on Android as my next likely platform, and it would take a lot for Palm to sway me. Even if they produce an incredible OS, they have an uphill battle ahead to win over developers. I don’t think they have a real chance at this point to gain significant market share. And without that the developers won’t come – and the apps really make the platform.

Going forward I think the mobile market will effectively be, in no particular order, Windows Mobile Professional, BlackBerry, Symbian S60, iPhone, and Android. The original Palm OS is the walking dead, and I don’t see Nova/Palm OS II carving out enough market share to be viable. Symbian UIQ is effectively dead as SonyEricsson and Motorola have pulled out and the Symbian world is focused on the S60-based open source effort. Windows Mobile Standard (aka Smartphone) is rapidly dying as Professional-based touch screen devices move into the lower end of the market where Standard used to focus. I expect Android, which is basically just coming into the market, to post the biggest gains as more devices land. I think the LiMo/LIPS effort will falter and expect to see some of the vendors who have been working on it switch to Android. I think those five platforms will provide the bulk of the smartphone market, anything else will be a small niche.

We’ll probably see more tru2way devices on display from a number of vendors this year, but I don’t know that we’ll see anything revolutionary in that market. I’m hoping TiVo may be showing off their ‘Series4′ tru2way-enabled model, which they’re believed to have been working on for a while. And they may be showing their new DirecTV software, which I expect will be running on the HR20/21/22 DirecTV DVR Plus hardware. I’m not expecting anything else major, maybe some new content partnership announcements and perhaps plans to bring TiVo to more countries. (I’m surprised they haven’t re-launched in the UK yet with the DVB-T model actually.)

The past couple of years the Blu-ray vs. HD-DVD fight provided some interest. But that was effectively over with CES2008, and officially ended when Toshiba threw in the towel in February. There aren’t likely to be any big announcements in the Blu-ray world, aside from more content partnerships like LG adding CinemaNow and YouTube to Netflix on their players. Maybe someone will be showing off higher density disc or 3D content concepts.

I’m hoping to be surprised by something at the show, something just unexpected. If you know of something I should be on the look out for, do let me know. And if you’re going to CES drop by the Sling Media booth and say hello. I believe I’m on the afternoons of Thursday, Saturday, and Sunday, and on Friday morning. I’m also scheduled to present for Sling Media at CntrStg on Saturday. Frankly I’m nervous as hell about that. It has been years since I’ve done a presentation or talk at a tradeshow and never at anything as big as CES.

OK, off to finish packing.

Despite some ongoing issues, it looks like the Comcast TiVo software is heading to Chicago. Dave Zatz over at Zatz Not Funny caught this in Comcast’s earnings call today:

We are rolling out TiVo beyond the Boston market test, where things are going quite well and we are going to be introducing other cities, probably starting with Chicago in the first quarter next year

This isn’t too surprising as Chicago is one of two cities where Comcast has rolled out tru2way support (the other being Denver – maybe they’ll be next?), and, as Light Reading’s Cable Digital News points out, it is another territory where Comcast uses Motorola hardware. Still no word on when Comcast and TiVo will complete the work to being the software to Cisco/Scientific Atlanta DVRs.

Comcast is also running a new TV spot to advertise the TiVo software:

In what can’t be a good sign for the progress of the TiVo software for Comcast, CNET’s Matthew Elliott has posted in their Crave blog that he’s finally given up in frustration and returned to using the standard non-TiVo Comcast DVR. He first starting using the TiVo software May, and while his initial impression was favorable overall, he had some issues with it as well – especially performance.

He followed up in July, and by then the bloom was already off the rose. His patience was low with the performance issues by then and he was experiencing frozen screens and missed recordings. He was already considering returning to the standard Comcast DVR.

Things apparently improved for a while starting last month. The number of glitches dropped and the performance seemed to improve. But then, last week, he was locked out of On Demand and lost the ability to record anything – and that was the last straw. As he sums it up:

My two biggest gripes with the Comcast + TiVo service were its speed and reliability. Setting a recording took anywhere from 20 seconds to over a minute. With Comcast DVR, a recording is set almost instantaneously. Service reliability was the bigger issue; TiVo would regularly freeze up and required to be reset–a process that required me to pull the cable box out, unplug it, plug it back in, and wait 10 to 15 minutes for the service to return–and then re-enter the 30-second skip code for the remote. Other than encouraging me to read more, the only advantages I found with TiVo were its suggested recordings, its ad-free channel guide, and a better organized list of recorded shows, which grouped multiple recordings of a show and all HD recordings into folders.

I’d really like to see TiVo succeed in bringing their software to cable DVRs, but the road so far has been long and rocky. At this point it seems that there is still a lot of work to be done, and some of the troubles may be due to the lack of power in the fielded hardware. The TiVo software is running on top of a middleware layer (currently a precursor to tru2way, and it should be tru2way in time) which runs on top of a base OS, and that means it will be hard to match the performance of a native OS. A solution for this could be newer generations of cable DVR hardware which are bring designed from the start to support tru2way applications, instead of existing hardware that has been updated with software.

There are so many variables involved it is hard to say if the troubles are with TiVo’s software, the middleware layers, the base OS, the hardware, the head-end servers, or something else. So the issues may be out of TiVo’s hands. But in the end it doesn’t matter to the end user, they just want the software to work and don’t care who’s problem it is. So I hope that TiVo and their partners can sort things out and make it ‘just work’, or it will continue to struggle to gain traction.

Just recently certified by CableLabs, Panasonic’s first tru2way-enabled HDTVs are now available at retail. The first VIERA HDTVs with tru2way support are available from Abt Electronics in Glenview, IL, and tru2way support is officially available from Comcast in Chicago and Denver. The sets will also soon be available at Ultimate Electronics and Circuit City stores.

The cable industry is aggressively rolling out tru2way support and all of the MSOs, except for Charter, have promised to have it available by July 1, 2009. Charter says they’ll have completed roll-out by July 1, 2010. So the territory where tru2way TVs will be usable will be rapidly growing in the coming months.

This is clearly a very limited roll-out that is more about bragging rights, I don’t think they’ll be selling a huge number of these sets just yet. The 42″ TH-42PZ80Q plasma has an MSRP of $1,599.95 and the 50″ TH-50PZ80Q plasma has an MSRP of $2,299.95. It is great to see the technology hitting the streets, it is a good sign for the future. We’ll certain to see a lot of tru2way products come CES in January.

The press release has more details:
Read the rest of this entry »

Comcast subscriberOops, correction, he’s not a subscriber he just lives in their territory. Peter Ting of Dover, MA recently received a flier from Comcast in the mail promoting the TiVo DVR software. He was kind enough to scan it and send it to me. I did a little trimming and resizing. Click on the images for larger versions.

EDIT: User mtchamp from the InvestorVillage TiVo board snail mailed me his copy of the original flier and I’ve re-scanned the images. I also made a scan of just the fine print, which wasn’t readable in the earlier scans.

CableLabs has certified two tru2way-enabled CableCARD HDTVs from Panasonic, paving the way for them to be available to consumers this holiday season. The two models sport 42″ and 50″ HD displays. This is an important turn around from June, when Panasonic reportedly failed in their first tru2way certification attempt.

However, even if consumers can get their hands on the sets, there is no guarantee that they’ll be able to access tru2way content immediately. The cable industry has pledged to implement tru2way across their networks by July 1, 2009 – except for Charter which has until July 1, 2010. So early adopters may wish to check with their local MSO to see if tru2way support is available before jumping on these sets, or they may find themselves stuck with unidirectional CableCARD features until tru2way support is rolled out.

From Light Reading’s Cable Digital News.

In a filing yesterday with the FCC on the current status on CableCARD deployments the NCTA revealed that there have been a total of over 374,000 CableCARDs deployed for use in Unidirectional Digital Cable Products (UDCPs), such as the TiVo HD, by the ten largest cable MSOs, which cover roughly 90% of US cable subscribers. That may sound like a lot, but in their last filing 90 days ago in June, they reported over 372,000 CableCARDs for the same ten MSOs and 90% subscriber base. That implies that only 2,000 CableCARDs have been deployed to UDCPs in the past three months by the top 10 cable MSOs – combined. That’s nothing. It would also make me wonder a bit about the sales of the TiVo HD, since I’d expect nearly all of those to have at least one M-Card CableCARD.

That is, of course, if the numbers are true – and they may not be. See the table below and especially the first footnote¹. Comcast’s numbers for September are estimated to be 10-15% lower than actual due to an internal error. We could be looking at an increase of more than 34,000 users instead of only 2,000!

While 34,000 would certainly be better than 2,000, it still isn’t really setting the world on fire. Maybe the M-Card is a ray of hope in those numbers – if customers who previously used two S-Cards are trading them in for a single M-Card on devices like the TiVo HD, it would result in a lower cumulative number. Still, I don’t expect that’s a huge number either.

This is not to say that the total number of CableCARDs in use is that small, not at all. Since the FCC’s ‘integration ban’ went into effect on July 1, 2007, forcing cable MSOs to begin using CableCARDs in their own STBs, those same ten MSOs have deployed over 7,800,000 CableCARDs in their STBs. So in less than fifteen months they’ve deployed more than twenty times the number of CableCARDs as have been issued for 3rd party UDCPs in the four years they’ve been available.

The integration ban was supposed to force cable MSOs to ‘eat their own dog food’ and thereby improve support for CableCARDs. The idea was that this would help foster the overall CableCARD market. Better support from MSOs would lead to more products, which would mean more 3rd party UDCPs in the field. For the most part, this hasn’t happened.

Why not? Well, I think I can sum it up in one brand name: tru2way. Starting late last year, and getting an official launch at CES in January, OCAP became tru2way and marked a push to get consumer electronics companies on board. Then starting with Samsung in May, followed by a larger push by Sony later that month, CE vendors started jumping on the tru2way bandwagon.

What does this have to do with slow CableCARD adoption? Well, these same CE vendors have held off on releasing UDCPs while they work on tru2way-enabled devices. Why invest in developing and marketing a unidirectional product when you’re going to obsolete it with a two-way product in a year? The first tru2way products are starting to trickle out, and there will probably be a bunch of them on display at CES in January. So I think the push for tru2way was a major contributor to lax CableCARD pick up. Vendors just haven’t been releasing CableCARD-enabled products so there aren’t many options for consumers, which naturally means not many cards are being deployed. Really the only major CableCARD product out there right now is TiVo. CableCARD TVs are thin on the ground. CableCARD-enabled Media Center PCs have had anemic sales. And Digeo outright canceled their Moxi CableCARD HD DVR.

CableCARD was slow out of the gate, and by the time MSOs had the infrastructure worked out vendors were already looking toward round two with tru2way and they just decided to sit round one with UDCPs out entirely. The deployment of SDV and the need to develop a Tuning Adapter, and to support it, was very likely a factor in that as well. I don’t expect to see any real pick-up in CableCARD utilization until a sufficient number of tru2way devices are available to consumers, and then I do expect to see a real uptick.

The filing also has information from several MSOs on their CableCARD pricing and install practices. To compare June to September:

¹Comcast states that their September number may by low by 10-15% due to internal reporting errors.

The count for this reporting period of CableCARDs installed in one way retail devices in active customer homes is estimated to be 10-15% lower than the actual number due to internal Comcast reporting errors that are the result of an internal Division reorganization during the reporting period. The next quarterly report will more accurately reflect the actual count.

Since Comcast has such a large installed base this could be the reason for the seemingly small total uptick. The other four combined yield an increase of 3,429. Comcast’s apparent drop of 1,383 drags it down. But if they’re short just 10% they would actually have an increase of 20,334 users. And 15% would mean an increase of 31,192! So we’d be looking at a total increase of 23,763 to 34,621 – rather more than around 2,000. And that’s just from these five MSOs.

²Comcast allows self-installs in at least some areas – 68% used truck rolls, 32% were self-installs.

³First card is free, fee for additional cards.

⁴$10.43 if install is included with other services, $25.14 if purpose visit.

⁵0.2% of Time Warner installs are self-install, which is negligible.

⁶The average is $2.26, but they report most divisions are $1.75 – which must mean the remaining divisions are rather higher to bring the average up.

According to TWICE, Digeo is working on two Moxi cable DVRs. The first will be distributed through Charter later this month, to also be followed by ‘a second MSO’. It’s only four months after they announced this the first time. Back in May at The Cable Show Digeo announced that Charter would carry the Moxi 3012 HD DVR by the end of 3Q08. So they have less than two weeks to meet that goal.

Of course, back in January Digeo’s then COO, now President, Greg Gudorf told me that their cable DVR would ship by the end of 1Q08. So we’ll see how this roll out goes.

The other Moxi DVR will be a CableCARD consumer product sold at retail and expected to ship in January. That will be a year after Digeo suddenly canceled all of their planned consumer products, just days after showing them at CES and talking up the launch plans.

Details on the consumer product are thin, I’m presuming they’ll have something to say about it at CES in January. Of course, they did last year too. Unsurprisingly it will be a CableCARD-enabled DVR, and it will not be tru2way-enabled. It sounds like they’re pitching all the same features they were on the canceled products – music and photo access, content partners, home control integration, etc. For music content Digeo has lined up FineTune, Rhapsody and Sirius and they have Flickr for photos.

The one new item that I found interesting is that they’re implementing DLNA support. I’d like to see more products supporting DLNA, standards are good and DLNA has growing support across a number of products such as the Xbox 360, PS3, HP Media Smart TVs, Blu-ray players, etc.

Digeo is also apparently still working on their Moxi TV for PC software, which I was told was in beta and close to release at CES 2008 in January. Though according to TWICE they have it running on XP, Vista, and Media Center versions of Windows now, and not just XP as at CES. No word on when it might be available to consumers.

Gudorf told TWICE that Digeo is working on future products for post-July 2009 which will support tru2way. Digeo signed the tru2way accord in June. But I’m not even going to devote any mental energy to that until Digeo manages to ship something to consumers.

Digeo started talking about launching new consumer products two years ago, in September 2006. (Which I picked up, amusingly enough, from an article in TWICE.) I talked to them at CES 2007 where they were showing mock ups and no real products with the promise of shipping later in the year.

They insisted they’d ship in time for the 2007 holidays up through September. (Oddly enough, another article from TWICE. Is covering Digeo a September tradition for them?) Then in November they admitted they weren’t going to ship in 2007.

Then I talked to them again at CES 2008, and they were showing off some of the same mock-ups they’d had at CES 2007, as well as some actual products. Just a week later they canceled the products and laid off nearly half of their staff. Digeo’s Gary Gudorf talked to me the next day to offer clarifications, including that their cable MSO product would ship by the end of 1Q08, which it didn’t.

We didn’t hear anything else until April when details on the cable product emerged. And then in May they exhibited at The Cable Show and issued a press release announcing Charter’s intention to carry it. In June Digeo signed the tru2way accord.

And now here we are in September again, two years after they first announced their intention to enter the consumer DVR market, and they’re promising a box ‘expected to ship in January’. You’ll pardon me if I don’t hold my breath. Assuming they do exhibit at CES in January, I’ll check out their offerings, again. As I said when I covered them this year, I think they have some good design points. But none of it matters until they manage to get a box on retail shelves.

I hear it’ll come bundled with Duke Nukem Forever.

Tipped off by EngadgetHD.

EDIT: This got some attention in AVS Forum, including from a Charter rep, who wasn’t encouraging:

Ironically yesterday I got whispers from a contact in St Louis who works with someone who’s got a beta 3012 (Don’t get hopes up, so far it seems only a few elite managers and tech ops people in St Louis have gotten to beta this unit)

Apparently it’s still got quite a few bugs, which I think is very odd, given really all they needed to do was improve on the existing hardware and leave the software alone.

At any rate I don’t expect to see them in 2 weeks, heck at the rate things are going, I’d consider us lucky if we see them before Q3 2009

I’d say I’m surprised or that this is unusual so close to a planned release – but frankly this is what I’ve come to expect from Digeo. They’ve had one product actually make it to market, the BMC9000 STB series from Motorola running the Moxi software. But that launched back in 2004 and has been out of production for a long time now. At its peak it only reached around 400,000 users, and the number of Moxi uses is believed to be much smaller now as units have been replaced with newer, non-Moxi DVR models. Unsurprisingly the main MSO to use Moxi was Charter, which, like Digeo, is controlled by Paul Allen. But even with it being ‘in the family’ Charter’s use of Moxi was minor.

Moxi’s history since they were acquired by Digeo has been one of failed execution. Early on Moxi was on their way to being a competitor in the consumer DVR space and they had some cutting edge plans, then Digeo acquired them and refocused them on cable MSOs instead of retail. Digeo acquired Moxi way back in 2002 – and in six years what have they done? One product which never achieved more than minor market penetration, and is now well out of date and discontinued. Aside from that they have a history of press releases and announced partnerships, awards won for products announced but never shipped, staff layoffs, and repeated product delays and cancellations. If they didn’t have Paul Allen backing them I don’t see how they’d still be in business. Digeo needs to ship a product, a good product, to significant numbers of users, if they want to earn consumer trust again.

TiVo today reported their financial results for the second quarter of fiscal 2009, which ended July 31st. They had a good quarter, turning in their second profitable quarter in a row, and their third ever, with $2.9 million net income and $10.6 million adjusted EBITDA. TiVo highlighted a few items in their release:

- Adjusted EBITDA for the second quarter was $10.6 million compared to a loss of $(11.2) million in the year-ago quarter, exceeding guidance
- Net Income for the second quarter was $2.9 million compared to a loss of $(17.7) million in the year-ago quarter
- TiVo service on Comcast now available in Connecticut; Comcast will also continue to fund development work for the TiVo product to expand the feature set and add support for the Tru2way infrastructure
- TiVo and Entertainment Weekly join forces to connect TV viewers with their favorite shows on an automatic basis
- TiVo successfully launched in Australia by Seven Networks
- YouTube videos now available on the TiVo service; TiVo now provides access to more television and broadband content choices than any other offering in the world
- TiVo’s recent research deal with media marketing research firm TRA ties anonymous viewing behavior to product purchases in millions of homes; Significantly changing the quality of information available to marketers

TiVo is continuing to bleed subscribers, which was expected. With DirecTV continuing to push their in-house HR20/21 DVRs are upgrades for DirecTiVo users, even with additions from Comcast, Cox, and Cablevision Mexico, TiVo lost 136,000 net MSO/Broadcaster subscribers. And while TiVo added 36,000 gross TiVo-owned subscribers, they lost 78,000 gross TiVo-owned subs, for a net loss of 42,000 TiVo-owned subscribers. This is mainly due to legacy subscribers upgrading to HDTV and opting for cable or satellite DVRs. This leaves TiVo with 1.686 million TiVo-owned subscriptions and 3.623 total cumulative subscriptions.

This may sound bad, but it is also partly because TiVo has made massive cuts in their marketing efforts to focus on profitability instead of subscriber growth. For the quarter just ended their subscriber acquisition cost was only $135, a massive decrease from the $758 of a year ago, and only a slight up-tick from the $118 of last quarter. Instead of lots of marketing, subsidies, and rebates, which drive up SAC, TiVo is focusing on working with retailers and other vendors to bundle TiVo with HDTV purchases to capture those upgraders before they pick up another DVR. They’re also focusing on their partnerships with Cablevision Mexico, Comcast, Cox, and Seven Network in Australia.

And in that area things are looking good. The TiVo launch in Australia with Seven Network has been going well and TiVo is happy with it, though actual figures have not been released. And Comcast is finally ready to start a major marketing push and to announce more territories:

In regards to our mass distribution strategy, a top Comcast executive offered the following comments on the progress the TiVo on Comcast service has made to date: “We are pleased with the progress of the TiVo service and have broadened its footprint in our New England market to Connecticut. Refinements to optimize the product’s performance have been mostly completed, significantly improving the user experience. Importantly, we intend to light up a full marketing campaign around TiVo in September and, upon this occurring, we will be announcing multiple additional markets to which TiVo will be rolled out through next year. We will also continue to fund development work for the TiVo product, which will include expanding the feature set and adding support for Tru2way infrastructure.”

Rogers stated, “Additionally, the TiVo service on Cox, which is currently in trials, is on track for a launch in Cox’s New England market later this year.”

“On the international front, Seven and TiVo successfully launched the TiVo service in Australia and because of the significant consumer demand there, retailers chose to release the product early. We are also extremely pleased with the marketing shoulder Seven is putting behind this launch as they’ve prominently featured TiVo in their marketing and programming including the Olympic opening ceremonies, their top rated morning show, and a special advertising spot they developed, which includes dozens of Australian celebrities. International distribution is an increasingly important component of our business model and there continues to be tremendous interest from international distributors for the TiVo offering.”

During the Q&A session when asked if Comcast had gotten to the point where they don’t require a truck roll for the TiVo software install, Rogers answered that that issue was a dependency on non-TiVo software and that Comcast was close to deploying the solution. It sounded like that was the gating factor for Comcast to launch the marketing effort, and that also helps explain Comcast’s satisfaction despite the delays, it doesn’t sound like it was TiVo’s problem.

During the Q&A session at the end of the call, Rogers once again mentioned a tru2way TiVo box, what the user community has started calling a ‘Series4′. He didn’t offer any specifics (unsurprisingly), but his feeling is that it will take more time for the industry to establish a national tru2way playing field to make it viable to release such a product. Personally I think that they may show something, prototype perhaps, at CES in January with the release for later in 2009 as most of the cable MSOs have pledged to have tru2way in place by July, 2009. Just my speculation.

You can get more information from TiVo’s release and key metrics.