TiVo, Comcast boxed in

Pact allows for DVR upgrade

TiVo and Comcast on Monday showed off a working version of a Comcast set-top box and DVR that can be seamlessly turned into a TiVo at the request of a consumer.

TiVo is hoping the technology, which it has been building with Comcast for two years, will be widely adopted so that cable TV providers might start offering their subscribers a choice between paying about $10 a month for a generic DVR or about $15 a month for a TiVo.

The TiVo-Comcast initiative has been in test mode for a few months, and the companies hope to begin selling it by spring. By year's end, Comcast should be offering it to its customers in most if not all of its major markets.

Cox Communications also has signed with TiVo and could offer the technology to its subscribers by year's end.

The Comcast-TiVo integrated product lets consumers upgrade their generic DVR to TiVo without an additional set-top box or even the need for a technician. A phone call will do the trick, said Jeff Klugman, a TiVo senior vp.

"It's virtually the same as ordering new channels," he said.

The TiVo-enhanced Comcast set-top box will let users search for, record and organize not only their favorite TV shows but also content that they purchase via video-on-demand, a concept that observers predict will help spur the VOD market.

"It's a great way to drive demand and stickiness for their offering," Klugman said. He called most cable VOD services "pretty frustrating" in terms of easily sorting through available titles.

The companies are demonstrating their solution at the Consumer Electronics Show in Las Vegas, where TiVo also has been announcing a host of partnerships unrelated to Comcast.

TiVo's flurry of activity, along with a stock price that has done nothing for more than a year, encouraged Bear Stearns analyst Kunal Madhukar to upgrade the stock Monday from "underperform" to "peer perform."

He said that while 2006 was a "year of learning and developing new products" at TiVo, the fruits of the company's labors ought to be seen by about this time next year, which could drive the stock price higher.

He also likened TiVo's work in turning the DVR into an advertising platform to early efforts at online advertising. "Once advertisers realized the potential of the Internet to draw consumers that were in the market, Internet-based advertising has taken off," he said.

TiVo stock rose 3% on Monday to $5.61 and continued its ascent in after-hours trading.
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