OK, I have to admit it. Tivo’s goose is cooked. I’ve been a Tivo user for years, and like most Tivo owners, I absolutely love the product. I’ve been convinced since I first plugged it in that some day, all TV would work like this. And I’m still convinced of that. Television as a fixed schedule grid determined by networks and cable operators is doomed. User control is the future of TV.
Unfortunately, Tivo the company hasn’t done as well as Tivo the idea, or Tivo the product design. The latest bad news is that Marty Yudkovitz, the ABC veteran brought in as President, is resigning. This after Mike Ramsay announced he would step down as CEO. Maybe someone else will come in and pull off a miraculous turnaround, but it seems unlikely. Cable operators and companies like Microsoft are launching their own digital recorders (DVRs), limiting Tivo’s growth prospects.
Tivo, though, still has two big assets. I’m reasonably confident those assets will be valuable enough for one of the major industry players to purchase, or perhaps a consortium. The assets are Tivo’s brand, and its patents.
Like Google, Tivo has reached “verb” status as a technology brand. People talk about “Tivoing” programs, because they associate the name with the whole concept of DVRs. That’s worth a lot, even to a company that plans to scrap Tivo’s actual technology. Just ask the good folks at Roxio, er, Napster.
Perhaps even more significant, though, is Tivo’s intellectual property. I don’t know exactly what patents Tivo holds, but it has a significant portfolio of assets, because it has been in the game so long and innovated in so many areas. Big interests that want to compete in the video space — and that, today, means some very big interests — won’t want to be on the other side of those patents. We saw a similar story recently with Intertrust, which held key digital rights management patents that led to an acquisition by Sony and Philips.