So TiVo sued Verizon. Then Motorola sued TiVo in apparent retaliation (much like Microsoft sued TiVo after TiVo sued AT&T). Now TiVo is filing a counter suit against Motorola (as they did against Microsoft), and to top it off they’ve included Motorola customer Time Warner Cable in the new suit. There’s some high stakes legal poker going on here.

Tongue out of cheek, the timing is primarily due to the stay on the Motorola suit, which was in place while the AT&T & Microsoft cases proceeded as they involved the same patents, being lifted. As long as the case was stayed TiVo was under no pressure to file a counter suit, but not things are moving forward. TiVo announced the suit in a simple SEC filing:

On March 26, 2012, the Company filed an answer and amended counterclaims in response to a patent infringement suit that Motorola initiated against the Company in the Eastern District of Texas in 2011 that was stayed until earlier this year. In its response, the Company alleged counterclaims against Motorola and Time Warner Cable, one of Motorola’s customers, for infringing U.S. Patent Nos. 6,233,389, 7,529,465, and 6,792,195 owned by TiVo.

The full court filing has been posted on Scribd (thanks to Sam Biller):
TiVo files answers and amended counterclaims against Motorola & Time Warner Cable

The patents involved are the same core patents behind the EchoStar/DISH Network and AT&T settlements, as well as the ongoing case against FiOS. TiVo’s been successful so far, 2 for 2, so that’s a good sign. Time Warner Cable is the only remaining top five MVPD in the US that TiVo doesn’t have a business agreement or a legal settlement from. TiVo has business agreements with the top two, Comcast and DirecTV, and fifth place Cox Communications. Third place DISH Network settled with TiVo. That leaves TWC in fourth place, and many investors have wondered when TiVo would take some form of action against TWC if they didn’t come to an agreement.

These legal fights tend to drag on for years, so I’m not going to hold my breath waiting on any outcome just yet.

AT&T has settled with TiVo, offering payments that will total at least $215 million, and potentially much more, in exchange for a mutual patent licensing deal. TiVo will receive $51 million up front, followed by recurring quarterly payments guaranteed through June 2018, for a total minimum payment of $215 million. In addition to these minimum payments, AT&T will pay recurring per-subscriber monthly license fees should the level of U-Verse subscribers exceed“certain levels”. Just what those levels are wasn’t revealed in the press release, but TiVo apparently expects the total payments to“significantly exceed” the minimums. In this case what’s good for AT&T is good for TiVo – the more subscribers they get, the more TiVo makes.

The Form 8-K TiVo filed with the SEC regarding this settlement reveals more of the details about the payments as well as the patents involved:

Under the Agreement, AT&T has agreed to pay TiVo a minimum amount of $215,000,000 (the “Payment to TiVo”) plus incremental monthly fees per DVR subscriber if the growth of AT&T’s subscriber base exceeds certain pre-determined levels. Based on currently available industry forecasts, TiVo expects that the total fees payable to it by AT&T under the Agreement will significantly exceed the guaranteed minimum Payment to TiVo. The first $51,000,000 of the Payment to TiVo is due on January 3, 2012 and the remaining amount is due to TiVo in equal installments 30 days after the end of each calendar quarter in the amount of $5 million for the first four calendar quarters and approximately $6.5 million in subsequent calendar quarters through the calendar quarter ending June 30, 2018. Any incremental additional per subscriber fees are due to TiVo on the same schedule.

Pursuant to the Agreement, TiVo granted AT&T a limited license under its advanced television patents, including the patents that TiVo had asserted against AT&T (U.S. Patent Nos. 6,233,389, 7,493,015 and 7,529,465), to make, have made, use, sell, offer to sell and import advanced television technology in connection with AT&T multichannel video programming services, including AT&T U-verse, subject to certain limitations and exclusions. AT&T granted TiVo a limited license under its advanced television patents, including the patents that AT&T had asserted against TiVo (U.S. Patent Nos. 5,809,492, 5,922,045, 6,118,976 and 6,983,478), to make, have made, use, sell, offer to sell and import advanced television technology in connection with TiVo products and services, including products and services provided to other multichannel video programming service providers, subject to certain limitations and exclusions.

We may learn more about the terms when TiVo files their Form 10-K after their fiscal year ends on January 31, 2012.

In addition to the settlement payments there is also the indirect benefit to TiVo in reducing their legal costs by no longer needing to pursue the suit. It also eliminates the distraction and allows their legal team to focus their efforts on Verizon. Speaking of Verizon, that’s where all eyes are now as they’re currently the sole remaining target for TiVo’s patent suits. With victories against EchoStar/DISH and now AT&T, it doesn’t seem unreasonable to expect Verizon to taking a serious look at their chances of victory and weighing it against the cost of a settlement. I fully expect TiVo to also be making a reinvigorated push to establish deals with the remaining US cable providers, such as Time Warner Cable, Cablevision, and Bright House Networks.

Taking a look at the top 10 US MVPDs (as of June 2011):

1. Comcast Corporation 22,525,000 – business relationship to allow VOD access to retail TiVo units, now in trials
2. DirecTV 19,433,000 – business relationship with licensing and new THR-22 DirecTiVo just released
3. Dish Network Corporation 14,056,000 – $500 million legal settlement and licensing
4. Time Warner Cable, Inc. 12,235,000 – no known agreement or licensing
5. Cox Communications, Inc. 4,838,000 – business relationship to allow VOD access to retail TiVo units, in development
6. Charter Communications, Inc. 4,413,000 – distributes TiVo directly to customers
7. Verizon Communications, Inc. 3,848,000 – ongoing patent lawsuit
8. AT&T, Inc. 3,407,000 – $215 million legal settlement and licensing
9. Cablevision Systems Corporation 3,284,000 – no known agreement or licensing
10. Bright House Networks LLC 2,139,000 – no known agreement or licensing

In addition, of course, TiVo is being distributed to customers of smaller cable MSOs Suddenlink (#11), RCN (#16), and Grande Communications (not in the top 25). Each victory, licensing deal, or business arrangement strengthens TiVo’s hand at the negotiating table. TWC, like Comcast, is large enough that they develop a lot of their technology and software in house. As such I don’t really expect them to adopt TiVo as their new platform, as Charter has. However, I would not be surprised to see them make a deal with TiVo to support VOD on retail TiVo units, just as Comcast and Cox have, in exchange for staying out of the legal crosshairs.

Verizon is more of a wildcard. They have a rocky track record when it comes to developing and releasing software updates for their FiOS STBs. And they have a small enough user base that outsourcing their software development to TiVo and benefiting from their economies of scale might benefit them. Their architecture is not all that different from Virgin Media in the UK and ONO in Spain. TiVo has already shown they can handle a hybrid cable/IPTV system with those networks, which is what FiOS is. To me that would be the ideal solution, as FiOS joining Team TiVo would increase development funding. And it is likely that they’d push the addition of features to match what they’ve implemented in house, which would benefit everyone. But they may also simply negotiate a licensing settlement like AT&T’s.

AT&T is pure IPTV and they’re using Microsoft software end-to-end. It was pretty much an impossibility that they’d adopt TiVo’s software for their STBs given the infrastructure they’re using. The licensing settlement is really the best result we could hope for in this case. Cablevision and Bright House could easily adopt TiVo as their next-generation STB platform. They’re smaller than Charter, who already has, and Suddenlink, also a TiVo user, is more than half as large as Bright House.

Oh, there is another reason I think TiVo will move more aggressively to establish deals with more MSOs on the back of this settlement: Google. More specifically Google’s pending acquisition of Motorola, the largest STB vendor for cable systems in the US, and Google TV. Back in August when I looked at the announcement, and specifically at the implications for TiVo, and then more recently in November, I stated that I full expect Google to bring the Google TV platform to Motorola STBs as a standard option.

More and more MSOs are looking at OTT (over-the-top) content to increase their competitiveness, which is a prime reason MSOs have turned to TiVo, and Google TV’s Android platform and apps would be a huge boon. Google has Sage TV to provide DVR technology and placeshifting, which also allows them to compete with EchoStar’s SlingLoaded offerings. They could build the streaming client into every Android phone and tablet sold, as well as Google+, that’s a very big stick – or carrot, depending on how you look at it. If Google’s acquisition of Motorola goes through, they will do this. I’m certain of it; it just makes too much sense.

But it will all take time, most likely a few years. The acquisition itself will take time. And then the work to port Google TV to Motorola HW and/or developing new HW to better support Google TV/Android needs to be done. Then they need to land MSO clients for the new HW/SW bundle, and get it deployed. It all takes time. And that time gives TiVo a window to expand their beachhead in the industry. Once an MSO has a significant deployment of TiVo HW and/or SW in the field they’re much less likely to walk away from that investment and adopt another platform.

I expect TiVo to redouble their efforts on the back of this victory. They may even have some deals in their back pocket to announce at CES this month. But for now they can celebrate one victory in an ongoing war.

And while you’re at it, donate $5 to the Marine Toys for Tots Foundation and Toys ‘R’ Us, Hasbro, and other companies will match it, for a total of $10 worth of toys.

But that’s not all; if you buy a phone with mobile hotspot capabilities and you actually activate them, Amazon will give you a $100 Amazon Gift Card.

The catch? All of this is for new activations only. The official word:

For a limited time only, all phones from Verizon, Sprint, and AT&T with a new line of service are on sale for a penny and include standard FREE Two-Day Shipping. Offer valid between midnight PDT November 21, 2011, through 11:59 p.m. PDT November 28, 2011, while supplies last. Plus, if you buy an eligible hotspot-ready smartphone and activate the hotspot feature, you’ll get a $100 Amazon.com Gift Card

There are 97 different devices to choose from. Mostly Android, unsurprisingly, but also WebOS, Blackberry, Windows Phone, and even non-smartphones. But why would you get a non-smartphone with this deal? You have one week, start shopping.

• Comcast: Checking their website it doesn’t look like anything has changed since last week. There are still FAQs saying that you need a professional install, but CED Magazine is reporting that they’re allowing self-installs now:
  

  “Certain markets have had limited self-install options for CableCards since about 2007,” said Comcast spokeswoman Jenni Moyer. “Beginning in early August, we’ll start rolling out a CableCard self-install program across our footprint where customers will be able to go into our sales, service or payment centers and pick up a CableCard self-install kit, go home, install it, and then call in to activate it.”

  Comcast doesn’t ship the CableCard self-install kits to customers.

• Time Warner Cable: As expected, TWC has started allowing CableCARD self-installs. They’ve even created help guides for InfiniTV, Moxi, and TiVo.
• Cox Communications: They were already allowing CableCARD self-installs before the mandate. They have an instruction sheet online.
• Charter Communications: Their website gives mixed signals. The FAQ still says professional installation, but they have a self-install page. I think they just missed updating the page:
  

  Due to the technical complexity associated with the pairing of the devices, all installations of a CableCARD MUST be completed by a Charter Technician. Self-installation of CableCARDs is NOT an option for customers and thus customers cannot pick up a CableCARD from a local office

• Verizon FiOS: As with Cox, they were already offering CableCARD self-installs. You can order your CableCARD online.
• Cablevision: They’ve also been offering CableCARD self-installs. The information is on their site.
• Bright House Networks: They allow self-installs for Road Runner broadband, which means they should be allowing CableCARD self-installs as of August 8th. But I can’t find info on self-installs on their site, and there is a page that still says they’ll be allowed soon:
  

  CableCARDs are professionally installed by Bright House Networks. The option to install a CableCARD yourself will be available in the near future.

  If anyone knows of information on their site indicating CableCARD self-installs, leave a comment.

• Suddenlink Communications: According to their CableCARD FAQ they are allowing self-installs.
• Mediacom Communications: I couldn’t find a good reference on their website, but a post on their support forum by one of their reps on Saturday indicates they are allowing users to pick up CableCARDs and do self-installs:
  

  You can pick-up or have a tech install a cable card for you for a minor fee. This would be $1.99 per month for each card.

• Insight Communications: I couldn’t find anything useful on their site. Searching their site for ‘CableCARD’ only returns four hits. It looks like they offer broadband self-installs, so they should be covered by the August 8th mandate. If you have more info, let us know in a comment.
• CableOne: Same as Insight, nothing clear from their site. It seems like they offer broadband and cable box self-installs, so they should also be covered under the August 8th mandate. Leave a comment if you have any info, thanks.
• WideOpenWest Networks: Their website still says they require a technician to install CableCARD, it is under the ‘Equipment’ section of the FAQ.
  

  Can I install a CableCARD by myself?

  No. To ensure that your installation is performed properly, a technician is required to install and activate your CableCARD. Please contact us to set up an installation appointment.

  They do seem to allow cable modem self-installs, so they should be under the mandate.

• RCN: I couldn’t find a good page on their site, but I did find a forum post on DSLReports dated July 28th, by Jason Nealis, RCN’s Sr. Director, Video Product and Video Operations:
  

  The way this will work is that a customer can receive a kit via mail or they can pick one up at a local office.

  In the Kit it will have instructions on whom to call, basically you will install the card and then go thru a IVR and have the work order closed and a hit sent to the card.

  Then you will have to call in with your pairing information and have the card paired to receive encrypted channels.

OK, I think that’s deep enough. These smaller provider’s tend to have sites that aren’t as useful when it comes to finding info, and those I’ve listed already cover the vast majority of cable customers in the US.

If you have any additional info, please leave a comment.

EDIT 8/11: Matthew Zinn, Senior Vice President of General Counsel for TiVo, today made a blog post about the new CableCARD rules which included a few useful links:

In the meantime, for additional information regarding CableCARDs and consumers’ rights visit www.fcc.gov/guides/cablecard-know-your-rights or www.fcc.gov/guides/digital-cable-compatibility-cablecards-plug-and-play.

If you have questions as to whether your cable operator is complying with the CableCARD rules, you can email the FCC at CableCARDEnf@fcc.gov or call (202) 418-1160. To file a complaint, visit www.fcc.gov/complaints.

If your cable provider isn’t following the new rules, report them to the FCC.

Ahead of the August 1st FCC mandated date, Verizon has begun allowing FiOS TV customers to self-install CableCARDs into their own devices, which primarily means TiVo of course. You can order a CableCARD online for you to install yourself – no truck roll, no install fee.

Originally reported by Zatz Not Funny.

If you’re a Palm OS user on the Verizon network, it is certainly worth checking out. I wasn’t sure the 680 would be worth upgrading from my old 650, but the updated form factor really is a noticeable improvement. It has a better ‘hand feel’ than the older models. The 755p is a similar improvement on the older 700p, let alone the old 600.

HD VOD is now available over the FiOS TV systems in Richmond and Virginia Beach, Va.; Tampa, Fla.; Fort Wayne, Ind.; and Pittsburgh. It is coming soon to the FiOS systems in the Washington, D.C., metro area, Massachusetts and Rhode Island; and to Verizon’s remaining FiOS TV markets next year.

The service is launching with an initial lineup of 75 titles, which is expected to grow to more than 1,000 titles by the end of 2008. Via EngadgetHD.

I have to give FiOS internet two very enthusiastic thumbs up and a 10/10 in the awesome scale. Seriously, I have zero complaints outside the monolithic Actiontec router they give you. If you only have the internet package you can sidestep the Actiontec (don’t recall the model number) with a router of your choice.

Television: I’d rather not bore you with the details of the premier package since it can be found on the V* site. Regardless, standard definition broadcasts are absolutely astounding on my 50″ plasma. Comcast and DirecTV don’t even come close to the PQ of the FiOS SD picture. It’s like night and day.

HD picture quality on FiOS is equally great, but the difference between what Comcast offers vs FiOS isn’t nearly a great deal as it is with SD. DirecTV’s original HD channels before the huge HD expansion they pushed recently were terrible. In fact, I thought the FiOS SD channels were only slightly less appealing than DTV’s original HD offerings.

As far as picture quality with FiOS, I once again give it two very enthusiastic thumbs up and a 10/10 on the awesome scale.

But weenah doesn’t pull any punches when it comes to their set-top box software:

I was hesitant to give up my TiVo for the FiOS DVR back in March. I knew I could use a TiVo with the FiOS service but I wanted to check it out for myself. The IMG (interactive media guide) FiOS offered back in March wasn’t aesthetically pleasing and wasn’t in the same league as a TiVo (hell, it wasn’t even in the same sport) but it worked. If you’re previously had TiVo you’ll absolutely hate the V* DVR. If you’ve never had TiVo before than you won’t think the solution V* offers is as bad, but you’ll still know it’s not great.

In late August V* rolled out the IMG 2.0 and it’s been a fluster cuck since then. The only positive thing I can say is that it’s at least prettier than IMG 1.0. Missed recordings, dropped “season passes” and numerous other issues have plagued the IMG. The FiOS forum on dslreports.com can tell you even more about the problems with the box. Also, a 160GB hard drive gives you about ~23 hours or so of recording space. That’s just not enough. I’d be more than happy buying an external eSATA drive to increase the size but that’s not an option because it’s locked down.

I’ve called numerous times to the FiOS support lines and have always been greeted with incredibly helpful people who are eager to address the problems. Unfortunately they are unable to fix the DVR. It’s the buggy software that’s the issue and it’s not something that can be fixed by a first or second level tech.

Ouch. That stings. At least FiOS does support CableCARD, so weenah does have the option to use a TiVo Series3 or TiVo HD. And it sounds like that may be the solution in the end:…I may find myself with a brand spanking new TiVo come Christmas time.

Personally, I’d love to have the option of using FiOS, at least for my data, and possibly to replace my cable service. But it hasn’t made it to my neighborhood yet.