August 31, 2009

TiVo future turns on patents

Patent infringement lawsuits filed by digital video recording developer TiVo have the potential to shift the industry dramatically, a market analyst said.

If TiVo wins court victories against Dish Network, Verizon and AT&T, there's a high probability that (DVR producers and television carriers) will have to pay TiVo licensing fees, said Barton Crockett at Lazard Capital Markets.

TiVo claims it owns the patent to time warp technology that enables the viewer to watch the beginning of a show while the machine is recording the ending. The technology also controls basic functions, such as fast-forward and rewind, USA Today reported Monday.

To date, court skirmishes have gone both ways.

A Texas court ordered Dish Network to pay TiVo $105 million and cancel 4 million of its subscriptions.

Dish Network then said it switched technologies to avoid the penalties, the newspaper said.

For that, the company was held in contempt and its penalty open to further review. TiVo has claimed Dish Network should now pay $900 million.

Dish is appealing the contempt order, however, and the U.S. Patent and Trademark Office has sent the case, essentially, back to square one, agreeing to reexamine TiVo's infringement claims, even those it has ruled on previously, the newspaper said.