1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

DIRECTV HD Receiver with TiVo (Official Q3 2010 Thread)

Discussion in 'DIRECTV General Discussion' started by Stuart Sweet, Jun 24, 2010.

Thread Status:
Not open for further replies.
  1. Stuart Sweet

    Stuart Sweet The Shadow Knows!

    37,060
    287
    Jun 18, 2006
    Just a quick note... The amount that DIRECTV is paying is fairly insubstantial to them and could easily be written of as bad debt or unrealized R&D.

    It's no proof of anything.
     
  2. wilbur_the_goose

    wilbur_the_goose Hall Of Fame

    4,476
    49
    Aug 16, 2006
    OR - D* is paying TiVo all that money to prevent legal action. Tax-free hush money?

    Personally, I don't care, but it'd be interesting if true.
     
  3. Doug Brott

    Doug Brott Lifetime Achiever DBSTalk Club

    28,939
    72
    Jul 12, 2006
    Los Angeles
    TiVo and DIRECTV have a non-litigation agreement .. Part of that agreement involves the exchange of money. This isn't hush money, this is a negotiated legal agreement. That was the crux of the 9/08 announcement (which extended & expanded earlier agreements). As noted by others, DIRECTV probably has gotten what they really want out of the agreement so if TiVo delivers, they win, if TiVo fails to deliver, they win. DIRECTV is really in a no-lose situation. I'm not entirely sure if TiVo is in a Win situation in either case, but if they ultimately deliver and can continue that arrangement over the long term (past expiration of Patents), then TiVo could ultimately win from this arrangement as well.
     
  4. jacmyoung

    jacmyoung Hall Of Fame

    6,544
    0
    Sep 8, 2006
    Of course your above facts can be spinned differently, from a different perspective:)

    For a long time TiVo relied on the lawsuit to secure its future. DirecTV's initial partnership with TiVo in 2006 was in a large part the result of trying to void the position DISH was in at that time. Even the new agreement in 08, judging from everyone is saying, is in part an effort to avoid lawsuit.

    Unfortunately since TiVo's initial win in 2006 against DISH, the litigation stalled, and maybe, just maybe, after the latest stall at the appeals court, TiVo began to rethink its strategy. A lot of the new partnerships you mentioned came very recently. I agree based on your evidence, and the evidence by bicker1, TiVo could be moving away from licensing to the big content carriers such as DISH, DirecTV, Comast...and working with small companies, maybe even going "back ends."

    On the other hand, the latest deals with the small cablecos might not be as potentially lucrative. For one thing, those deals all seem to require that TiVo provides not only the software, but hardware manufacturing as well, which is a much more costly model than the DirecTiVo or the Comcast model. At the same time, if one of the above posts is correct, RCN only charges $2 extra for the TiVo DVR, meaning TiVo demands RCN very little from their partnership.

    From the standpoint of the small cablecos like RCN, if TiVo can provide software development and hardware manufacturing at such a low cost to RCN, why not? Maybe if TiVo agreed to offer similar deals to DISH, DirecTV, Comcast...TiVo could have already done what you say they were trying for years.

    Instead, TiVo, in part I think because its early court wins against DISH in 2006, wanted do as little as possible for a monthly licensing fee from all the big guys, having no part in any hardware manufacturing cost, in the case of DISH, TiVo simply just wanted to collect a fee while doing nothing. That did not work and likely TiVo has decided that it may never work, therefore the change of its strategy.

    Getting back to the topic, I don't think we can blame TiVo for serving its own best interest, however as a result, the new DirecTiVo is delayed and it is likely irrelevant even if it rolls out some time in the future, therefore it is understandable some remaining DirecTiVo fans blame TiVo for the delay.
     
  5. Mike Bertelson

    Mike Bertelson 6EQUJ5 WOW! Staff Member Super Moderator DBSTalk Club

    14,040
    94
    Jan 24, 2007
    I just put forth this theory to try to move away from the previous discussion.

    Stuart brings up a good point. The amount DirecTV has paid this year is pretty small on a percentage basis. I hadn’t considered that before but thinking about it now it would seem an amount easily written off by DirecTV.

    Now, if this project is dead in the water, how does that affect TiVo’s future profitability? Right now they’re losing money...some have said bleeding cash but I’m not sure that’s true.

    Mike
     
  6. Stuart Sweet

    Stuart Sweet The Shadow Knows!

    37,060
    287
    Jun 18, 2006
    I'd say their future profitability is based more on the results of lawsuits.
     
  7. CuriousMark

    CuriousMark Icon

    505
    0
    May 21, 2008
    Yes, this deal for DirecTV is probably mostly about the No Sue clause.

    If this product is dead in the water, it hurts. It would complete the transition of TiVo away from the satellite camp to the cable camp. I think TiVo would prefer to have a foot in both if it can.

    Except for 2 or 3 quarters, TiVo has lost money since day 1, even when DirecTV was their biggest revenue source. In the last few years the losses are much smaller than they were before Rogers. Since the Dish payment they have more in the bank than they have ever had, and can sustain their current burn rate for years, so in that respect they are more stable than ever before. But make no mistake, until they turn into a profitable company, they are a risky proposition.
     
  8. CuriousMark

    CuriousMark Icon

    505
    0
    May 21, 2008
    That is the common thinking. I used to believe it too, but not so much any more as I see the new directions starting to be real instead of just dreams.
     
  9. Mike Bertelson

    Mike Bertelson 6EQUJ5 WOW! Staff Member Super Moderator DBSTalk Club

    14,040
    94
    Jan 24, 2007
    Interesting. I have to wonder how long that would last though.

    Mike
     
  10. Steve

    Steve Well-Known Member

    23,041
    148
    Aug 22, 2006
    Lower...
    Actually I don't believe that's the case. When DirecTV bought Replay a couple of years ago, I'm pretty sure one of the drivers for that acquisition was ownership of the TiVo-Replay "no sue" agreement the two companies struck earlier in the decade.

    I believe that when DirecTV struck the latest dea with TiVo, they sincerely wanted to add a TiVo-based box to their arsenal as a retention/acquistion option, for those subscribers that absolutely HAVE to have TiVo. I say this, because when they struck the new deal with TiVo back in 2008, the old deal wasn't due to expire until sometime in 2010, so there was no gun to their head to do anything at that time.
     
  11. Sixto

    Sixto Well-Known Member

    12,224
    94
    Nov 18, 2005
    5/25/2010:
    In terms of our relationship with DIRECTV, aggressive development activity continues and we expect the launch of that product by the end of the year.

    On the DIRECTV front, we are still very much aiming for the end of this year in terms of deployment. Mike White, the new CEO of DIRECTV, who I've been able to establish a good dialogue with, I think has done a very nice job of being able to make sure our respective teams are communicating well and overcoming any development challenges that may appear in our path and keeping us on track in terms of getting that out. So we are continuing to make progress there.

    Sure. Well, as you know, our new DIRECTV deal kicked in on February 15. And as a result, there is an increase in the cash that we're receiving from DIRECTV for monthly subscribers. However, until our new product with DIRECTV is accepted a little later this year, we'll continue to be recognizing revenue at the old rate. And that's just a pure accounting guidance rule that we have to follow.

    http://seekingalpha.com/article/206957-tivo-f1q11-qtr-end-04-30-2010-earnings-call-transcript
     
  12. jacmyoung

    jacmyoung Hall Of Fame

    6,544
    0
    Sep 8, 2006
    There are indications that TiVo no longer believes it can rely on the above thinking. I am pleasantly surprised the discussions here have revealed a lot more than just the delay of the new DirecTiVo.

    From the very beginning, I speculated that this new DirecTiVo agreement was in large part DirecTV's way to avoid litigation, but also to place DISH in a disadvantage, giving TiVo another support for seeking a "significantly higher damage rate" from the court, the announcement was made one day before TiVo went to hearing with DISH, during the hearing, for the first time TiVo asked for a $2.20 damage rate, a "significantly higher" rate than the old $1.20:)
     
  13. Sixto

    Sixto Well-Known Member

    12,224
    94
    Nov 18, 2005
    As with most things, it will all come down to features and price.

    If they somehow, miraculously, support all of the features of the HR24, including seamless MRV with other DirecTV receivers, which I'm not sure is possible, and they support TiVo Desktop, and the price is reasonable, they just might have a chance.

    Many if's, but $2.5M cost, no profit, per quarter, is not trivial in this economy.
     
  14. grooves12

    grooves12 Godfather

    483
    0
    Oct 27, 2005
    But, most of the deals they are signing are small, and just token-efforts by the cable co's. I'm willing to bet in large part, motivated by fear of being sued shall Tivo's patents be validated.

    If they lose that power of the companies, pretty much all the deals will disappear.
     
  15. jacmyoung

    jacmyoung Hall Of Fame

    6,544
    0
    Sep 8, 2006
    Fearing of lawsuit is not necessarily one of the reasons. Most cablecos rely on third parties (such as Motorola) to provide DVR hardware and software services, not because they fear being sued, but because it is a cost effective business model.

    Small cablecos can't compete with large ones, or DBS, if they also rely on the same third parties. TiVo's recent partnership with those smaller cablecos seem to fit in the puzzle. There is no doubt TiVo can provide a more advanced DVR solution for the smaller cablecos so they can stand out from the DVRs provided by the large cablecos, the key is that TiVo has to provide a similarly cost effective model for them. TiVo seems to be doing just that, provides not only software development, also the hardware, at a very reasonable fee, judged by the mere $2 extra fee charge by RCN for the TiVo DVR.

    If DISH gets a similar deal, using the 4 million DISH DVRs currently subject to the contempt order, apply the $2, will result in a $96M annual fee paid to TiVo which is even less than the $120M DISH's CEO said he was willing to pay TiVo per year to settle the lawsuit, and TiVo does not have to provide the hardware to DISH BTW.

    The point is, if TiVo decides to offer DVR services to the content providers at a reasonable rate, things can happen, whether it is for a large company, or a small one. The deals TiVo made with the large companies in the past are not as good as what the recent deals TiVo is making with the smaller cablecos, sepecially when one considers that the large companies such as DirecTV are capable of their own DVR development, therefore TiVo needs to have an even more attractive model for them to make sense.

    The "significantly higher fee" TiVo will charge DirecTV for the new DirecTiVo, while DirecTV must still provide the hardware, is hardly a good deal for DirecTV, when we can agree the DirecTV's own new DVRs are not any less capable.
     
  16. Stuart Sweet

    Stuart Sweet The Shadow Knows!

    37,060
    287
    Jun 18, 2006
    Unless I'm mistaken, the higher fee will be charged to the subscriber. I don't think DIRECTV itself is absorbing any part of it.
     
  17. jacmyoung

    jacmyoung Hall Of Fame

    6,544
    0
    Sep 8, 2006
    I thought at least some of the cost would be passed onto the subs but Doug did not think so. The current TiVo fee is not directly passed onto the DirecTiVo subs. But any cost is always passed onto the subs one way or the other.
     
  18. Doug Brott

    Doug Brott Lifetime Achiever DBSTalk Club

    28,939
    72
    Jul 12, 2006
    Los Angeles
    consider that my thinking has recently changed .. It's just a guess on my part, though.
     
  19. jacmyoung

    jacmyoung Hall Of Fame

    6,544
    0
    Sep 8, 2006
    If directv must absorb the cost then it may explain why it is not so motivated.
     
  20. bicker1

    bicker1 Hall Of Fame

    1,040
    0
    Oct 21, 2007
    What I dismissed as unfounded were the expectations on the part of consumers, not the facts with regard to the deals made and the project plans announced.

    Red Herring.... I didn't "fail to accept" any facts.

    Actually, the problem here is that I live in reality-land; hard, cold, don't believe anything other than proven facts, reality-land. I suppose that that's upsetting for folks who prefer to hold to unfounded expectations.
     
Thread Status:
Not open for further replies.

Share This Page