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TiVo, DirecTV Up Relationship

12 Apr, 2006 By: Erik Gruenwedel

Digital video recording (DVR) pioneer TiVo Inc. has inked a three-year extension of its 2003 commercial agreement with satellite TV provider DirecTV.

The agreement, which extends existing DirecTV customers with Alviso, Calif.-based TiVo service, continued maintenance and support, asserts neither company will pursue patents rights claims against the other.

Financial terms of the agreement were not disclosed.

With more than 15 million subscribers, El Segundo, Calif.-based DirecTV represents about 60% of TiVo's 4.4 million subscribers.

DirecTV, which earlier this year said it planned to roll out a DVR-based video-on-demand service with 2,000 titles by the end of the year, also markets a non-TiVo DVR.

Separately, Sony Corp. next month will begin marketing a flat-screen TV that reportedly allows viewers who are TiVo subscribers the ability to alter the endings of commercials.

In all, Sony would offer 12 endings per commercial targeted at female and male viewers, the idea being if viewers are engaged in the outcome of an ad they will be compelled to watch more of them.

Reports suggest 39% of U.S. households will own a DVR by 2010, and 70% of advertisers say the DVR and video-on-demand would likely kill the 30-second TV ad spot.

“Advertisers are simply trying to increase the amount of time consumers spend in their branded environment,” Davina Kent, VP for national sales at TiVo, told Business Week.

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