TiVo To Step Up DVR Sales To Smaller Cable Systems

PHILADELPHIA (AP) — TiVo Inc. said Wednesday that it sees a promising market for its digital video recorders among small and medium-size cable TV operators.

CEO Tom Rogers said the company recently reached a deal with RCN Corp. that would let the cable TV provider offer TiVo's DVRs to its subscribers. He sees other cable systems following suit because using TiVo's DVRs as their own would be cheaper for them to deploy than buying DVRs from manufacturers.

"We'll be their primary DVR," Rogers told analysts at the Kaufman Bros. Investor Conference in New York. "This is a very economic solution for the cable operator."

TiVo will receive monthly fees for leasing out the DVRs and doesn't have to shoulder the cost for marketing these boxes to cable subscribers, Rogers said.

To roll out early next year, the TiVo-RCN high-definition DVR will have video-on-demand features as well as access to the Internet so viewers can watch shows available online.

"We think that for the middle and smaller cable operator, this is a very, very interesting solution to expand our distribution footprint."

RCN is the first cable TV operator to use TiVo's DVR and software together. TiVo's technology is being licensed by Comcast Corp., Cox Communications Inc. and DirecTV Group Inc., but these pay-TV operators use their own DVRs.

Shares of Alviso, Calif.-based TiVo rose by 30 cents, or 2.9 percent, to close at $10.79 Wednesday.