TiVo Prepping Ad-Based VOD Service

Digital video recording pioneer TiVo is looking to join the “+” video bandwagon.

The company is quietly assembling an ad-supported video-on-demand service to compete against platforms such as The Roku Channel, Pluto TV, Philo TV, Shout! Factory TV, Tubi, Crackle+ and  IMDb TV, among others.

In a post on the TiVo community blog, Ted Malone, VP of consumer products and services, said the company has secured third-party content agreements for the service.

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“Our soon to be launched TiVo+ video service will include dozens of channels of free entertainment,” Malone wrote. “We have assembled an amazing set of partners as part of this service and will be evolving it in the coming months with many more channels, on-demand movies and shows and other specialty content coming as well.”

With Netflix, Amazon Prime Video and Hulu dominating the subscription VOD market as pioneers in the space, ad-supported VOD has emerged as a free alternative to consumers featuring largely catalog content.

With studios and other content holders eager to mine a new revenue stream, AVOD has gone mainstream beyond early pioneers Shout! Factory and Sony’s Crackle.

TiVo last week announced it would begin rolling ads playing ahead of consumers’ recorded TV content.

Malone, in his post, reiterated that users will be able to skip the ads, which are “served dynamically” when playback starts. Ads do not appear after a user pauses and resumed playback of content.

“As part of our commitment to improve the experience, we are measuring each step in the process and will be continually optimizing the ads to reduce latency and improve performance,” he wrote.

 

TiVo Bringing Ads to DVR Content

TiVo popularized the digital video recorder (DVR), enabling TV viewers to record and playback programming.

Now the company wants users to watch ads before viewing their time-shifted content. TiVo plans to roll out so-called “pre-roll” ads on all recorded content within 90 days.

The move underscores the ongoing value of advertising in an over-the-top landscape that eschews them. For TiVo, which now operates as two separate companies focusing on software IP and hardware, respectively, ad-insertions open up a new revenue opportunity.

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“DVR advertising is going to be a permanent part of the service,” a company representative told LightReading.com, which first broke the news.

The company, which began testing the concept with its TiVo Experience 4 device, will roll out the ads to all TiVo DVRs.

“We’re dedicated to innovation that helps our customers stay in control of how, when, and what they watch,” TiVo said.  “Advertising is an important part of every media business and TiVo is investing in new advertising experiences.”

The company also said it designed the new DVR advertising software with the ability to ‘skip’ ads anytime a customer chooses to.

Some media reports said users attempting to bypass ads found the process more complicated than simply pushing a button.

Regardless, TiVo, which saw a 9% drop in second-quarter (ended June 30) platform revenue, in addition to a $9.5 million operating loss, said the ad-insertions would help stabilize operations.

“This is part of our ongoing commitment to bring our users the best media discovery experience possible,” the company said.

 

TiVo Narrows Q2 Fiscal Loss

DVR pioneer TiVo is in the process of transitioning its hardware and intellectual property (i.e. patents) into separate operating businesses.

In the meantime, the current combined company continues to right its fiscal ship — narrowing the second-quarter (ended June 30) net loss nearly 54% to $9.54 million from a net loss of $20.5 million during the previous-year period.

Total revenue increased nearly 2% to $176.1 million from $172.8 million last year. Through the first six months of the fiscal year, TiVo revenue is down about 8% at $334.4 million from $362.6 million.

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The bulk of revenue comes from TiVo’s portfolio of IP patents enabling third-party pay-TV operators to offer subscribers on-demand content, video recording, content recommendation and related viewership data.

Indeed, TiVo said it has expanded its third-party advertising functionality to include promotions surrounding VOD movie transactions.

 

The company said promo campaigns deliver strong performance results, including an 81% increase in digital transactions for a Hollywood studio using the software over three weekends to promote a new movie title.

Licensing, services and software revenue increased 3% to $174.4 million, while hardware sales fell about 50% to $1.67 million.

CEO Dave Shull said TiVo remains on track to separate the businesses.

“Based on my experience with strategic transactions and operational transformations, we are making great progress on the separation of TiVo’s Product and IP Licensing businesses,” Shull said in a statement. “We remain on track to complete the separation in the first half of 2020.”

TiVo ‘Wins’ Another Round in Comcast Patent Dispute

TiVo June 4 received a favorable ruling by Administrative Law Judge MaryJoan McNamara of the International Trade Commission (ITC) that select aspects of Comcast’s cloud-based X1 video platform infringe Rovi’s patents.

Rovi, which acquired DVR pioneer TiVo in 2016 for $1.1 billion, operates under the TiVo brand name.

TiVo has a worldwide portfolio of over 5,500 patents. Patents involve advertising, analytics, DVR, guide, search and record, interactive TV and apps, AR/VR, multi-screen, parental controls, VOD/OTT, social media, sports, personalization and voice.

This was the second positive ruling for TiVo. In November 2017, the ITC issued a final ruling that Comcast had infringed two Rovi patents around ‘remote record’ functionality.

Comcast subsequently removed this feature from their products, according to TiVo.

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Then on May 23, the ITC launched a third investigation into Comcast for infringing six Rovi patents including: X1 Sports App, multi-room DVR features, and set-top box integrations of apps like Netflix.

That query has also been assigned to McNamara.

“We are thrilled by yet another legal victory,” Arvin Patel, EVP and chief intellectual property officer at Rovi, said in a statement. “We hope that today’s decision will encourage Comcast to pay the necessary licensing fees so their customers can once again access advanced cable features.”

That may be wishful thinking.

McNamara’s ruling is just one required step before the ITC can mandate Comcast make additional changes or pay license fees to TiVo – which the latter would prefer.

The cable behemoth contends TiVo’s technology is outdated and has instituted proprietary technology in the X1 platform.

In a statement, Comcast viewed McNamara’s decision a victory since the judge found “no violation” regarding two of the three other patents involved in the complaint.

“We look forward to the full commission’s review of the one remaining patent later this year, but we are confident, regardless, this ruling will not disrupt our service to our customers,” Comcast said. “We will continue to resist Rovi’s efforts to force Comcast and our customers to make unreasonable payments for aging and obsolete patents.”

 

TiVo Names New CEO, Updates Business Outlook

TiVo has named Dave Shull, former chief executive of The Weather Channel, as its new CEO, replacing interim CEO Raghu Rau, who becomes vice chairperson on the company’s board of directors.

As CEO of The Weather Channel from 2015 to 2018, Shull overhauled the organization to streamline operating costs, separated the digital assets from its television and OTT products resulting in the successful sale of its digital businesses to IBM in 2016.

Prior to The Weather Channel, Shull held various executive roles at Dish Network for 10 years. He holds a B.A. from Harvard University and an M.B.A. from Oxford University.

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“In addition to Dave’s deep experience in the pay-TV, OTT and digital media fields, he has a strong track record of driving value creating strategic outcomes and operational transformations,” Jim Meyer, chairman of the board, said in a statement.

Indeed, driving growth and strategy are just what TiVo needs as it separates its hardware and IT patent businesses.

The DVR pioneer also announced that, based upon improved visibility into its sales pipeline, it is raising fiscal 2019 expectations from those provided on May 9.

It now expects revenue of $644 million to $660 million, up from previous range of $640 million to $654 million, and a pre-tax loss of $72 million to $80 million, lowered from the previous pre-tax loss of $75 million to $87 million.

TiVo now expects Adjusted pre-tax earnings of $175 million to $185 million, up from the previous range of $172 million to $178 million.

Additionally, TiVo said it expects to repay $345 million currently outstanding on its 2020 convertible notes by the maturity date, from its cash, cash equivalents and marketable securities on the balance sheet and anticipated operating cash flow.

Finally, TiVo reaffirmed that it expects to complete the separation  of its hardware and patent software businesses in the first half of 2020.

 

 

Comcast Ending ‘Xfinity On Demand’ Access for TiVo Users

Comcast Cable reportedly is set to end access to its “Xfinity On Demand” app for TiVo devices, effective June 25.

In an email to subscribers — first reported by tech blogger Dave Zatz — Comcast said “out of date [TiVo] technology that cannot be upgraded or updated” was the reason for pending non-access.

Comcast said the shutdown would not affect recorded programming, and access to Xfinity Stream would still be available on Apple iOS, Android Xfinity apps and Xfinity website.

“VOD is also available on TiVo through Hulu, Amazon Prime Video and Vudu apps,” read the message.

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The pending shutdown comes as TiVo and Comcast remain embroiled in tech royalty disputes. The DVR pioneer in April appealed to International Trade Commission and filed litigation against Comcast alleging patent infringement on technology related to streaming video and cloud-based DVR.

TiVo, which is splitting into two separate companies focusing on patents and hardware, in 2017 received ITC backing for a complaint involving remote time-shifting functionality on Comcast’s X1 set-top devices.

It filed litigation against Comcast in April in U.S. District Court in California.

“We believe Comcast’s Xfinity X1 continues to infringe Rovi’s cloud and multi-room DVR patents – a vital component of home entertainment,” Arvin Patel, EVP and CIPO at Rovi,” said in a statement.

Rovi, which acquired TiVo in 2016 for $1.1 billion and assumed the latter’s brand name for the merged companies, claims to have invested over a billion dollars into its patent portfolio and products.

“We are extremely proud of our patent portfolio of over 1,000 issued patents in the US.,” Patel said.

Comcast, which launched much of its cloud-based X1 features via TiVo technology, claims it has developed its own tech and that most TiVo patents in question are outdated.

TiVo Expands Data Tracking Fields

As time-shifting video pioneer TiVo separates its product and IP licensing businesses into two companies, itannounced that its TV viewership data is being expanded to include third-party services Kantar ad occurrences, and Drawbridge’s Identity Graph and premium demographic attributes.

The Kantar ad data enables customers to know both the programming viewership as well as the advertising viewership across millions of U.S. households.

The Drawbridge Identity Graph enables customers to link viewership data with associated mobile ad identifiers, extending the reach and measurement of advertisements and marketing across pay-TV, over-the-top and digital platforms.

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“Household-level TV data is becoming more attractive as the advertising and media industries look to connect consumer touchpoints across screens, platforms, and campaigns across the TV ecosystem,” Ben Maughan, VP business development and data product management, TiVo, said in a statement.

“Marketers rely on Kantar’s industry-leading ad intelligence data to track competitive activity in their sector. By connecting with TiVo viewership data, we can give our customers a holistic view of what messages consumers are receiving,” said Vik Sharma, SVP for media and tech at Kantar.

“TV’s power as an awareness channel is clear, but it’s long been missing the component of identity,” added Jon DeGennaro, VP of enterprise partnerships at drawbridge. “There’s no reason why TV can’t be as targetable and measurable as other platforms and give marketers the ability to reach and report on viewership, engagement, and conversion across the entire cross-channel consumer journey. Bringing identity to TV does just that.”

With these integrations, TiVo solidifies its role as an innovator in the TV data landscape and continues to deliver improved viewership data products that are partner-agnostic and consistent with the transforming industry.

TiVo Splitting into Two Companies

Time-shifting video pioneer TiVo is separating its product and IP licensing businesses into two separate companies.

TiVo’s said its board concluded the separating would be the best strategy to maximize shareholder value. The company intends to spin out its DVR-based hardware business to shareholders. Throughout the separation process, the board would seek “strategic” transactions for each business that could create additional stockholder value.

“Operating independently, these two businesses will have increased flexibility to pursue new and growing market opportunities,” Raghu Rau, Interim CEO, said in a statement.  We believe this separation is the best way to maximize shareholder value, while also enhancing the possibility of value-creating strategic transactions.”

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TiVo expect to complete this transaction in the first half of 2020 through a spinoff of the product business to shareholders.

The product business offers software technologies video service providers or retail markets. At the end of 2018, there were an estimated 23 million households worldwide utilizing our TiVo software. The product segment generated $401 million in revenue, with a large component of recurring revenue.

TiVo believes the separation would “open” its product business up to greater receptivity from service providers, content providers and device manufacturers, as well as potential customers in new markets.

The unit is planning several new product and business model launches later this year, including creating a new content network with increased monetizable opportunities through advertising.

TiVo’s branded IP portfolios (including Rovi) encompass about 5,500 patents and pending applications worldwide. Licensees include traditional and new media video providers across pay-TV, over-the-top video, mobile, CE and social media markets. Licensing revenue reached $295 million in 2018, with a high percentage of this recurring revenue.

“As video consumption continues to shift beyond traditional pay-TV into Internet, social media and mobile domains, we believe it is important that the licensing business can diversify … into new consumer applications and functionalities,” Rau said. The separation will enable the IP business to strategically reinvest in its own business, not only to solidify its strong, existing foundation, but also to appropriately pursue new long-term growth opportunities.”

Redbox Taps TiVo for Recommendation Engine

Redbox has engaged TiVo Corp.’s Personalized Content Discovery platform, including search, recommendations and insights, to engage new customers, increase retention and enhance loyalty across Redbox.com, Redbox On Demand and physical boxes nationwide, according to TiVo.

Redbox has more than 41,500 kiosks nationwide renting movie discs and games and a transactional VOD service Redbox On Demand.

“TiVo’s platform enables more tailored recommendations to connect Redbox consumers with the content they love, across viewing devices,” according to the TiVo press release.

Redbox will also enable TiVo’s Video and Video Game Metadata, including access to TiVo’s library of enhanced entertainment metadata and high-resolution imagery, to further personalize content discovery, according to the release.

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“We are excited that Redbox has selected our technology to give their customers a highly personalized, feature-rich entertainment experience they can enjoy across all of their devices,” said Walt Horstman, SVP and GM, advanced media and advertising, TiVo. “Redbox is fully utilizing our Personalized Content Discovery platform and showcasing how it can be used in many non-linear environments, including redbox.com, their mobile apps, and physical boxes throughout the country.”

“With TiVo’s Personalized Content Discovery platform, we are able to offer our consumers a more engaging and relevant entertainment experience across multiple devices,” said Ash Eldifrawi, chief marketing and customer experience officer at Redbox. “We’re gaining a more holistic view of all of our audience metrics, helping us align our data and insights across all devices and platforms, ultimately allowing us to grow our business.”

TiVo Inks Software Deal with Anime Provider Funimation

TiVo March 14 announced it is licensing software to Funimation, the anime content provider and a subsidiary of Sony Pictures Television. The software includes TiVo branded content search and recommendation technology.

The software will enable Funimation to test, manage and fine-tune search and recommendation performance in real-time to help improve the user experience and generate more engagement from viewer searches.

The software is now fully operational on Funimation’s website and on Funimation Now, the company’s streaming video platform, as well as across a wide range of over-the-top video platforms, including Apple TV, Google Chromecast and Roku streaming devices.

As part of the agreement, TiVo is also providing Funimation with an integrated product and merchandise search function that provides a single landing page for both viewable programs and relevant ecommerce merchandise including DVDs.

“Funimation provides an opportunity to showcase our personalization technology for content providers to help them make the consumer entertainment experience more engaging and streamlined,” Sean Moore, VP, content provider accounts, TiVo, said in a statement. “Through features like ‘More Like This,’ viewers will no longer have to search for content they might like; the content will now find them.”