Digital TV Facts: The Latest

It’s been a rough week for viewers who want to digitally record TV shows. TiVo asked one court to deactivate Dish Network DVRs because of a patent dispute, and a group of Hollywood studios and broadcast networks asked another to shut down Cablevision’s planned “network DVR” service over alleged copyright violations.

Cablevision isn’t the only cable operator interested in centralized video playback for its customers:

In March, Comcast COO Steve Burke and Time Warner Cable chief financial officer John Martin told investors at an analysts’ conference that their respective companies would probably follow Cablevision’s lead if it were able to launch nDVR successfully.

Time Warner dumped its Mystro nDVR service in 2004 to placate content providers. Its Start Over feature, which allows viewers to restart a live program from the beginning, incorporates Mystro technology, according to Mediaweek. But Start Over does not allow fast-forwarding, and a CED article says that Time Warner—a media empire that happens to own plenty of content—arranges copyright clearance for the programming.

• Links: Mediaweek, CED

TiVo, turning up the heat in its patent dispute against EchoStar, is asking a federal court to have Dish Network’s digital video recorders disabled and pulled from retail and distribution outlets.

In court papers filed Monday, TiVo sought to disable the DVR functionality in all but 192,702 of EchoStar’s DVRs already placed with customers.

TiVo prevailed last month in a patent-infringement suit against EchoStar, parent of Dish Network. Where infringement has been found, courts have been disposed toward granting injunctions. But a Supreme Court ruling earlier this month, in a case involving eBay, may remove that presumption.

TiVo must “paint the picture that ‘they’re going to drive us into oblivion,’ ” said Brad Wright, a patent lawyer who isn’t involved in the case. “In the past, the court cases said you could presume irreparable injury if the patent was infringed. I think the Supreme Court has put a question mark on that.”

(But TiVo always seems on the verge of oblivion. Does that make it easier to prove?)

EchoStar plans to appeal the Texas jury’s verdict.

• Links: ABC, LA Times

TiVo will enlist magazine editors to select programming for viewers. Entertainment Weekly, Vanity Fair and Star have signed on to create “Guru Guides,” packages of shows recommended by editors.

With thousands of shows jockeying for viewer attention on any given day, DVR owners may welcome this curatorial feature—or not; I shudder to think what the editor of Star might want me to watch.

If the recommendations are to have any sway, they must be real. Hand-picked selections from a top editor, colored by his or her very own human passions, quirks and manias—that’s something I could appreciate. What I don’t want, of course, is to have the marketing department of a Time Warner publishing property “recommending” shows from Time Warner’s television properties.

• Link: IHT

The digital video recorder (DVR) is finding its way into more homes, and more DVRs are high-definition models:

IMS Research estimated that HD DVRS made up 29 percent of the total worldwide shipments in 2005, and the Austin, Texas-based research company projects that number to increase to 54 percent by 2010. In 2005, U.S shipments of HD DVRs were estimated to account for 36 percent of all DVRS shipments.

Cable and satellite TV companies, which are driving DVR growth by leasing or selling the devices to subscribers, no longer want to be confined to your living room. According to iSuppli,

…operators are looking to expand their footprint within consumers’ homes by deploying multi-room, or “whole-home” DVR capability. Multi-room DVRs support distributing video programming from a centralized DVR to multiple TV sets in the home by leveraging networking technologies over coax or powerline….

iSuppli expects the number of boxes with multi-room capability to expand from only a few million units last year to more than 50 million units in 2010.

• Link: Communications Technology

Internet video service Brightcove, through a deal with TiVo, has found a shortcut to deliver broadband content to the television screen.

Brightcove distributes video content online for brands that include MTV’s Teen Channel, National Lampoon and the Farmer’s Almanac.

Initially, Brightcove will provide TiVo with broadband video content from a small group of suppliers. TiVo subscribers with Internet-connected Series2 DVR boxes can access the content, some of which will be ad-supported.

It’s an important step for Brightcove and a boon for content providers. But will viewers find value? More choice can be welcome (actually, according to recent research, more choices can make us less happy), but ultimately it will depend on what programs show up on the DVR.

• Link: ABC

DirecTV is on track to deliver its new high-definition DVR this summer, according to CEO Chase Carey. While we await that upcoming HD-DVR, which supports MPEG-4 compression, the direct-broadcast satellite provider continues to distribute MPEG-2 TiVo models.

As DirecTV’s announced per-share earnings beat estimates this week, Carey called it “a solid quarter.” Some analysts were less enthused, noting an accounting change and a declining subscriber growth rate (which actually boosts short-term profit). Carey emphasized DirecTV’s success in attracting more profitable, “higher quality subscribers,” partly due to the up-front fees they now collect from “the high-risk customers.” Average monthly per-subscriber revenue is $69.75, up 6 percent. (Compare Time Warner Cable.)

The cost of acquiring one new subscriber now stands at $668, seemingly an eye-popping number, yet only $10-15 higher than targeted. With HD receivers and DVRs, hardware costs are up at the company. Carey acknowledged being “late on getting a DVR to the market.” Problems with early MPEG-4 receivers raised costs, and an estimated 10 percent of those boxes were returned. Carey said debugging has resolved the issues.

DirecTV continues to expand HDTV content, with HD transactions now double what they were first quarter last year. Local digital channels, including high-def, will be available in “close to three quarters of the country” by year-end, Carey said. Two new satellites to be launched next year will increase HD capacity. Over the next three years, he said, customers can expect to see “a pretty rapid migration of most of the successful channels” to HD, though he sounded dubious about the prospects for specialized, created-for-HD channels. While Prudential’s Katherine Styponias said rival Dish Network has “an arguably stronger high-definition offering that is likely to appeal to the high-end customer,” Carey maintains that DirecTV’s HD programming beats many cable offerings.

Speaking of rivals: While declining to speculate, DirecTV’s CEO would not rule out another attempt at a merger with Dish parent EchoStar. “I think there’s no question you’ve got a different regulatory environment,” Carey said.

• Links: Media Stock Blog, Forbes

A television service from AT&T will offer video downloads from Akimbo along with Dish Network programming, the telecom giant announced this week.

Movielink downloads and DSL service will also be part of AT&T Homezone, set to launch in 13 states by late summer. The bundled offering gives the telephone company a foothold in home-delivered television and IPTV until it can push forward with its Lightspeed fiber-optic TV network in the years to come.

Last summer, when Akimbo’s video library had just 2,000 titles, David Pogue of the New York Times called it “puny and overpriced.” Akimbo now offers 10,000 older movies and TV shows, downloadable from the Internet through the same set-top box that delivers Dish Network and Movielink selections. The box, made by 2Wire, includes a DVR.

OK, so AT&T gets practice at providing subscription TV. That’s the apparent purpose of this exercise. But what about me-the-viewer (you do remember who this is about, don’t you)—what do I gain from this multiplication of middlemen?

Let’s see: Fewer boxes, a single bill. I guess that’s worth…something.

Meanwhile, as telecom firms spend billions to build television-delivery networks, analysts discount their competitive threat:

Significant competition from phone giants AT&T Inc. and Verizon Communications Inc. could take longer to emerge than initially anticipated as they roll out TV services slowly, analysts said.

• Links: San Jose Mercury News; Washington Post

It’s victory for TiVo in its patent-infringement suit against Dish Network’s parent, EchoStar, according to an announcement from the DVR maker.

• Link: Reuters

Look who’s not getting sued by TiVo:

DirecTV will extend its service agreement with TiVo for three years.

So what, says Thomas Hawk:

Really the DirecTV TiVo deal is not that big of a deal in my opinion. TiVo only gets a lousy buck a month for the DirecTV units but certainly today’s news doesn’t hurt.

DirecTV still wants to develop its own DVR with NDS Group. The service deal goes through Feb. 2010. DirecTV’s TiVo distribution rights run through Feb. 2007. Today’s agreement includes a “no patent suits” clause.

Did sentiment that favors TiVo in its case against EchoStar have anything to do with the timing of the deal?

• Link: Thomas Hawk

An MPEG-4-capable DVR/receiver from Dish Network records up to three high-definition programs at once. The model ViP622 recorder is pricey, buggy and crash-prone, according to cnet’s editors, who nonetheless call it

the most fully featured, versatile, and future-ready high-def DVR you can buy today.

Moving from the DVR showroom to the DVR courtroom: TiVo could walk away with as much as $300 million in damages from Dish parent EchoStar if its patent-infringement claim is successful. The satellite company insists it developed its own, separate DVR technology.

Some industry-watchers give the advantage to long-struggling TiVo. It could be a make-or-break for the DVR pioneer.

• Links: cnet, Pierce Law IP News