AT&T to pay $215M to TiVo to settle patent suit

Jan 04, 2012 By RYAN NAKASHIMA , AP Business Writer

(AP) -- AT&T Inc. will pay TiVo Inc. at least $215 million through June 2018, becoming the latest TV signal provider to settle a patent lawsuit involving the digital video recorder pioneer.

Per subscriber, this payout will be much larger than a similar $500 million TiVo reached in May with satellite TV company Dish Network Corp. and its set-top box provider, EchoStar Corp.

Dish had about 13.9 million subscribers at the end of September, while AT&T's U-verse had just 3.6 million. That makes AT&T's settlement worth at least $59.72 per subscriber, while Dish's cost $35.97 per subscriber.

TiVo CEO Tom Rogers said the bigger settlement resulted in part from the fact that AT&T heavily marketed its digital video recorders as a key difference between itself and bigger cable TV providers.

"From the get-go, their offering was primarily based on DVR," Rogers said. He added that TiVo is pursuing another similar case against Verizon over its FiOS service. He said marketing for FiOS also emphasizes its DVRs. Verizon has about 4 million video subscribers.

TiVo shares jumped $1.15, or 12.9 percent, to $10.07 after hours on the news, while AT&T shares rose 21 cents to $30.59 after hours. TiVo's stock had fallen 5 cents in regular trading Tuesday as the markets rose overall.

A spokesman for AT&T declined to comment.

AT&T will pay more than $215 million if subscriptions to its U-verse television package rise in line with forecasts, TiVo said.

The first $51 million was due in a lump sum on Tuesday, with another $20 million due in the first year and quarterly payments after that.

The settlement will bring TiVo's operations closer to profitability, Rogers said.

Founded in 1997, developed the first commercially available recorder, making it easy for people to record programs and watch them later and to skip through advertisements. The innovation changed the way ratings agency Nielsen measures audiences as more people began watching shows well after they aired.

Explore further: New iPhones deliver big profits for Apple

not rated yet
add to favorites email to friend print save as pdf

Related Stories

TiVo offers dual recorder

Apr 26, 2006

TiVo fans now have something new to smile about. The television digital video recorder company TiVo announced Tuesday the launch of its TiVo Series2 DT DVR May 1, which will allow consumers to record two shows at once.

TiVo Inc. sues AT&T, Verizon over DVR patents

Aug 27, 2009

(AP) -- TiVo Inc. on Wednesday sued AT&T Inc. and Verizon Communications Inc. for patent infringement, including one covering the ability to pause and rewind live TV.

Appeals court gives Dish a chance in TiVo case

May 14, 2010

(AP) -- A federal appeals court Friday granted Dish Network Corp. a full-court review of a ruling that threatened to force the satellite TV company to disable millions of its customers' digital video recorders because of ...

Report: DirecTV to promote own 'Tivo' box

Oct 07, 2005

DirecTV is reportedly set to unveil its digital video recorder next week in what is seen as a direct challenge to the increasingly popular TiVo device.

Recommended for you

New iPhones deliver big profits for Apple

22 minutes ago

The new big-screen iPhones helped propel Apple's profit and revenue in the past quarter, as the California tech giant delivered stronger-than-expected results.

Facebook sues law firms, claims fraud

1 hour ago

Facebook is suing several law firms that represented a man who claimed he owned half of the social network and was entitled to billions of dollars from the company and its CEO Mark Zuckerberg.

IBM 3Q disappoints as it sheds 'empty calories'

1 hour ago

IBM disappointed investors Monday, reporting weak revenue growth again and a big charge to shed its costly chipmaking division as the tech giant tries to steer its business toward cloud computing and social-mobile ...

MasterCard, Zwipe announce fingerprint-sensor card

Oct 18, 2014

On Friday, MasterCard and Oslo, Norway-based Zwipe announced the launch of a contactless payment card featuring an integrated fingerprint sensor. Say goodbye to PINs. This card, they said, is the world's ...

User comments : 0