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Rogers: TiVo ‘Called Back Into Action’ by Ops

6/11/2012 12:01 AM Eastern

New York —
TiVo president
and CEO Tom
Rogers said partnering
with cable
operators is
critical to TiVo’s
future, and he expects
to get “very
substantial” revenue
from its patent
holdings and
pending litigation.

“We were flatly
rejected by the cable
industry when
it came to the DVR,”
he said at the “TV
3.0: What’s Next”
event presented by
the Broadcasting &
Cable
Hall of Fame at the Paley Center for Media here, noting
that MSOs opted for generic digital video recorders.

Now, with the need to meld live TV, recorded content,
video-on-demand and Internet-delivered video, many
cable operators are turning to TiVo for help, according to
Rogers. “We’ve kind of been called back into action,” he
said. “We very much have allied our future with theirs.”

TiVo has distribution deals with several pay TV providers,
including Charter Communications, Suddenlink
Communications, Virgin Media, RCN and DirecTV.

Asked by moderator Becky Quick, anchor of CNBC’s
Squawk Box, about TiVo’s litigation strategy, Rogers said
the company’s preference is to work out business relationships,
characterizing lawsuits
as a last resort.

“When you invent a technology
and it has real distinct
value … we have to be
able to protect the value of
that innovation for our shareholders,” Rogers said, adding,
“We’ll get some very substantial revenue from that.”

Earlier last week, TiVo filed a patent-infringement lawsuit
against Cisco Systems after Cisco proactively sued
TiVo seeking to void the same four patents. TiVo is suing
Verizon Communications and Time Warner Cable — both
large Cisco customers — and has legal action pending
against Motorola Mobility.

In May 2011, TiVo reached a landmark $500 million settlement
with Dish after seven years of litigation, on top
of $105 million Dish and EchoStar paid to TiVo up to that
point. Then, in January, TiVo announced a settlement and
patent-licensing deal with AT&T, under which the telco
will pay a minimum of $215 million — and as much as
$300 million — through June 2018.

Meanwhile, Rogers opined that the television industry has
failed to address the problem of how ad-skipping — enabled
by TiVo’s DVRs and others — is eroding the value of TV advertising.

More than 40 million households have DVRs, and more
than 50% of viewing is recorded,
with more than half
of those viewers skipping
ads, Rogers said. “Very little
is being done to say, what’s
the alternative to reaching
those people,” he said. “The industry has really done very
little to approach that problem.”

TiVo offers various options for marketers to advertise
on its DVRs, including the ability to present an ad when a
viewer pauses a video or to show one at the end of a
program.

“There are other ways to use that screen … that would
give marketers all kinds of way to engage with their audience,”
Rogers said.

September