Feeds

TiVo subscriptions go up – for the first time in 4 years

Turns the corner as Virgin and RCN deals cut in

Application security programs and practises

TiVo in the US has definitively turned the corner, increasing the number of Tivo subscribers in the quarter for the first time in four years, turning a 33,000 deficit last quarter into a 117,000 gain this quarter. This long awaited milestone was greeted in the current US investment market with a yawn, and no significant rise in share value, partially because TiVo is still throwing off losses, a fact that is almost certain to change as its MSO based subscriber base continues to grow in the next few quarters.

TiVo has over $600m in liquid assets but is valued at just $1.1bn putting a total enterprise value on the business right now of just $500m, an exceptionally low value given that its quarterly ever been at almost $65m. You have to go back to 2008 to see TiVo figures that high and back to 2007 to see them slightly exceeded.

The lack of share price movement can be put down as much to the state of the US markets right now as to the performance of TiVo. In fact right now, the fact that no one has sold TiVo stock sounds like a good performance.

One of the key breakthroughs has been at Virgin in the UK, where in a single quarter it has jumped from 50,000 installed TiVo customers to 220,000, as its deployment picks up speed. It has similar deals at Ono in Spain and at new cable customers including RCN, Suddenlink, Grande and Charter in the US, which will begin to be additional over the next two quarters.

Tom Rogers, President and CEO of TiVo, said, "This was a great quarter and represented a significant step in our growth strategy ... We also exceeded our quarterly guidance on service and technology revenues, Adjusted EBITDA and net income... Additionally, DirecTV intends to launch its TiVo offering in select markets in December with a nationwide rollout to follow early next year. All of this is a testament to our leadership in advanced television and our ability to drive meaningful solutions to market."

For the third quarter, service and technology revenues were $51.8 million, growing 25 per cent year on year compared to guidance of $49m to $51m. Adjusted EBITDA was a loss of $13.9m, compared to Adjusted EBITDA guidance of a loss of $17m to $19m and TiVo ended the quarter with 2.04 million total subscriptions. At its height in 2007, we think it once reached 4 million.

Rogers continued: "Demand for Virgin Media's TiVo offering is quickly growing throughout the UK. Just six months after launch, Virgin Media said that it had more than 220,000 TiVo subscribers live, up from the 50,000 just three months prior. Even more impressive is that 40 per cent of these TiVo subscribers are new to Virgin Media."

TiVo says that although RCN has yet to really affect the mix, its early customers have also experienced higher customer satisfaction and lower churn in TiVo homes.

The company also slowed churn in Tivo-owned subscribers down to 1.5 per cent per month and pointed to its upcoming integration with Comcast VoD currently in field trial, as a potentially critical design win, which will drive TiVo-owned subscriptions (the customers will sign with TiVo, not Comcast, for the service).

TiVo said it had also delivered 1.95 billion interactive advertising impressions, which means its advertising revenue is coming up close to that of many cable companies.

If you factor in potential court wins at AT&T and Verizon, which might lead to licence deals with their suppliers, Microsoft and Motorola, then the upside on TiVo right now is considerable. The company's next step is to get a settlement and cut litigation spending and it also says that R&D spend is currently artificially high. It also says that it has more distribution deals, like Virgin and Charter, up its sleeve.

TiVo put its guidance for service and technology revenues in the range of $48m to $50m for the coming quarter, a number it is likely to beat comfortably, as well as a net loss in the range of $31m to $33m, again something it could surprise us on.

Copyright © 2011, Faultline

Faultline is published by Rethink Research, a London-based publishing and consulting firm. This weekly newsletter is an assessment of the impact of the week's events in the world of digital media. Faultline is where media meets technology. Subscription details here.

The Power of One eBook: Top reasons to choose HP BladeSystem

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
Airbus promises Wi-Fi – yay – and 3D movies (meh) in new A330
If the person in front reclines their seat, this could get interesting
UK Parliament rubber-stamps EMERGENCY data grab 'n' keep bill
Just 49 MPs oppose Drip's rushed timetable
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
Samsung threatens to cut ties with supplier over child labour allegations
Vows to uphold 'zero tolerance' policy on underage workers
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
prev story

Whitepapers

Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Application security programs and practises
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.