Fans of the TiVo device and service will soon have another opportunity to hook up with Direct TV as the companies announced a joint agreement today to create a brand new TiVo branded HD DVR.
The new high definition digital video recorder will hit the market in 2009, probably in the summer to early fall time frame. While DirecTV and TiVo originally hooked up as business partners back in 2000, Direct TV has not sold TiVo branded set top boxes in several years. This agreement marks the first change in the status of that relationship. Direct TV and TiVo have continued to work together in servicing those customers who purchased a TiVo box in the past and who have satellite TV service.
The deal is non-exclusive for Direct TV. They will continue to make and market their own DVR devices, but the deal with TiVo will be another choice for customers seeking to watch TV on their own terms. The move also indicates that Direct TV thinks it can gain yet another competitive advantage over both DISH Network and cable TV companies like Time Warner. Giving customers more choice, even at a higher cost has proven to be an effective business model for Direct TV over the last few years.
The move is a no-brainer for TiVo as well. After a few lean years, TiVo seems to be on a roll, with their recent court victory over DISH Network, though still under appeal, and now the expanded Direct TV deal. TiVo desperately needs to add subscribers to its service, which can be billed either monthly or yearly. In the years since Direct TV stopped selling new TiVo set-top boxed, the company has seen its subscriber numbers contract as cable and satellite TV companies have been using boxes from other manufacturers. This deal gives TiVo access to both sell a box up front, and collect monthly subscriber fees from a potential pool of over 17 million DirecTV subscribers.
While specific pricing for the set-top HD DVR units or the monthly fees were not released, a clue came in a TiVo’s with the SEC. In that filing, TiVo said it expects minimum payments from DirecTV to be “substantially higher” than the current deal between the companies. Obviously, DirecTV will pass these charges through to customers who select TiVo service. With DirecTV’s higher-end customer base, charging a little more for TiVo service shouldn’t be much of a problem.
{ 3 comments… read them below or add one }
The court win should give them a lot more leverage in licensing their software to other cable and satellite providers.
When is this coming out?!?! I need Tivo with my Direct TV. Their DVR is clunky and outdated, it has to go. Please Direct Tv give me my TIVO!
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