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Netflix, TiVo Pact Goes Beyond Direct-Access

29 Nov, 2016 By: Erik Gruenwedel

Reading between the lines in TiVo and Netflix’s licensing agreement affording TiVo set-top box users direct access to the subscription streaming video pioneer, realizes the two companies ended a long-running legal dispute involving Rovi Corp., which acquired TiVo in April for $1.1 billion.

That Rovi, TiVo and Netflix are pioneers in online video, underscored in part Rovi's litigation (since 2011) against Netflix with respect to five of its patents related to various features and functionality provided by the SVOD service.

Last year, a federal judge sided with Netflix claiming the alleged patent violations were mute following a separate 2014 U.S. Supreme Court ruling. At the same time, Judge Phyllis Hamilton with the U.S. District Court for the Northern District of California, rejected Netflix’s claim the patents in dispute were limited to broadcast TV.

The patents were among Rovi’s more than 1,500 issued patents and pending applications.

“Our agreements with Netflix represent a major milestone for TiVo as we expand our offerings for the fast-growing OTT space, and further demonstrates our commitment to delivering innovative technologies to new and emerging markets,” CEO Tom Carson said in a statement.

“The partnership between Netflix and TiVo dates back to our early days of streaming video,” added Bill Holmes, Netflix global head of business development.

Eric Wold, media analyst with B. Riley & Co., contends the agreement appeared a face-saving move as TiVo turns the page on the transaction and focuses on integrating more than 10 million TiVo-served households to Rovi’s base of about 18 million households worldwide.

Indeed, both Rovi and TiVo have been successful in monetizing their innovations and intellectual property, with more than $3 billion in combined IP licensing revenues and past damage awards.

“Seems like a risk-avoidance move by TiVo — with potentially positive long-term OTT implications,” Wold wrote in a note.


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