Tag Archives: rovi

Patent Bully Rovi Gets Makeover With Acquisition Of TiVo

TV patent giant Rovi ( ROVI ) on Friday announced a $1.1 billion deal to buy digital video recorder pioneer TiVo ( TIVO ) and adopt TiVo as its new corporate name. San Carlos, Calif.-based Rovi agreed to pay $10.70 a share in cash and stock for San Jose, Calif.-based TiVo. The acquisition had been rumored for several weeks. Rovi stock was down a fraction to about 17 in afternoon trading in the stock market today . TiVo stock was up more than 5% to near 10. “Rovi’s acquisition of TiVo, with its innovative products, talented team and substantial intellectual property portfolio, strengthens Rovi’s position as a global leader in media discovery, metadata, analytics and IP licensing,” Rovi CEO Tom Carson said in a statement . “It’s an exciting time as the media and entertainment landscape undergoes a significant evolution. “The combined capabilities of TiVo and Rovi place us in a tremendous position to extend services across platforms and to a customer base that includes traditional, over-the-top and emerging players across the globe.” Rovi has earned a reputation as a patent bully for its litigious behavior. This month, Rovi sued Comcast ( CMCSA ) for patent infringement after failing to come to terms on a new licensing agreement. Last year, Netflix ( NFLX ) successfully defended itself from a Rovi patent infringement lawsuit. A U.S. federal judge ruled that the five Rovi-owned patents it wielded against the streaming video company were invalid. Rovi holds more than 5,000 patents in areas such as digital entertainment guides, DVRs and on-demand programming. It generates the majority of its revenue through patent-licensing agreements with pay TV services. Once the TiVo acquisition closes, the combined company will have over 6,000 patents. Piper Jaffray analyst Michael Olson looked favorably on the deal. “The rationale for the deal makes sense, with overlapping customers and organizational goals, and synergies that could make the combined business more profitable,” he said in a report Friday. “Specifically, the company is expecting $100 million of cost synergies and that the deal will be EPS accretive within the first 12 months.” Olson reiterated his overweight rating on Rovi stock with a price target of 29. Olson noted that litigation is a component of both companies’ business models.

Here’s How Apple Could Up Its TV Game With Skinny Bundle On Hold

Loading the player… Apple ( AAPL ) has put plans for its own “skinny” streaming bundle on hold, but the tech giant could expand its presence in the television space with the acquisition of DVR maker TiVo ( TIVO ), according to an analyst with Albert Fried. Reports surfaced in late March that TiVo was in talks to be acquired by Rovi ( ROVI ), a supplier of interactive program guides. While the analyst says that deal has merits, a TiVo acquisition by a consumer electronics company like Apple, Amazon ( AMZN ) or Microsoft ( MSFT ) is more attractive. That’s because consumer electronics firms “can better market and develop TiVo and TiVo’s ability to sell to roughly 80 million (subscribers) could be better exploited.” TiVo shares jumped 23% on the buyout rumors to retake their downward-sloping 200-day line. The stock is now looking for support around that level, rising nearly 1% on the  stock market today . TiVo is trading 20% below its 52-week high. Apple tried to retake its 200-day line in Monday’s session, but closed the day just below that level. The stock has now fallen back below the 110 price level, edging up 0.4% intraday. Shares are trading about 18% below their all-time high reached at the end of last August. Amazon rose 1.8% intraday, while Microsoft ticked 0.4% higher. Meanwhile, Starz ( STRZA ) announced Tuesday it’s launching its own over-the-top streaming service, joining Netflix, Time Warner ( TWX )-owned HBO, CBS ( CBS ) and others in the pursuit of capturing the cord-cutting audience. The $8.99-a-month Starz service undercuts that of Netflix ( NFLX ), which is raising its price by $2 to $9.99 in May for “grandfathered in” customers. Starz rose fractionally while Netflix dipped 0.5%.

TiVo Jumps 21%: Rovi Merger Would Combine Intellectual Property In Pay TV

TiVo ( TIVO ) stock surged on reports the DVR pioneer is in talks to be acquired by Rovi ( ROVI ), a provider of interactive programming guides to pay-TV companies and smart-TV manufacturers. Shares in TiVo surged 21% in the stock market today  by midafternoon. Rovi stock fell 4%. Both TiVo and Rovi hold intellectual property for features built into pay-TV set-top boxes and garner licensing revenue. Rovi and TiVo face big changes among their customers as the pay-TV industry faces growing competition from Internet video providers, such as Netflix ( NFLX ), Alphabet -Google’s ( GOOGL ) YouTube as well as new TV hardware from Apple ( AAPL ) and Roku. Federal regulators aim to open up the set-top box TV market . TiVo shareholders would reportedly get cash and stock in the deal and own about 30% of the newly formed company. TiVo has expanded beyond hardware sales and patent licensing to online subscription services. TiVo’s customers include small and midsize pay-TV companies. Analysts have said TiVo aims to provide more cable firms with next-generation features, including its cloud platform and mobile apps, analysts say. Apple and Google have been among companies rumored to be interested in acquiring TiVo in the past. Rovi gets an IBD Composite Rating of 86 out of a possible 99, though today’s drop puts it below its key 50-day moving average. TiVo holds just a 26 Composite Rating. “Together, the combined TiVo and  Rovi entity would have more than 6,000 issued or pending patents,” said Mike McCormack, a Jefferies analyst, in a research report. “TiVo alone has generated around $1.6 billion of settlements to date from patent enforcement lawsuits vs. Dish Network ( DISH ), AT&T ( T ), Verizon ( VZ ), and Cisco-Motorola-Time Warner. There are 380 issued patents in TiVo’s portfolio, plus 340 pending patents, many of which expire beyond 2018.”