This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Netflix, TiVo Plan Leaves Viewers Hanging

Netflix (NFLX - Get Report) and TiVo (TIVO - Get Report) jumped Friday as two wheezing tech favorites formalized their video-on-demand partnership.

Netflix jumped 8% and TiVo rose 4% in midday trading after the two companies said late Thursday that they had formed a joint development agreement. The move came about a month after Newsweek reported the linkup, setting off a rally in the once-beloved stocks that has mostly dissipated.

While the move combines two well-known names in home video entertainment, no terms were disclosed, leaving a number of questions about just how the companies plan to make the venture work.

After leading their respective categories, both Netflix and TiVo began to lose steam in recent years as rivals invaded their niches. To some, the sketchy joint venture confirms that both companies may be desperately reaching for some differentiation strategy, now that their corners on the market have grown crowded.

In recent months, both Wal-Mart (WMT) and Blockbuster (BBI) have launched DVD-mailing ventures to compete with Netflix.

Similarly, TiVo was a pioneer in digital video recording that allowed users to record TV programs on set-top hard drives. But now, despite legal claims on proprietary technology, TiVo has faced an onslaught of imitators offering generic digital video recorders.

Even worse, satellite broadcasters like EchoStar (DISH - Get Report) have been offering digital recording boxes to win new subscribers.

"We still question how TiVo will be able to build a large, meaningful retail subscriber base, when cable and satellite companies can afford to give away or at least heavily subsidize technologically more advanced DVRs," writes Vintage Research analyst Bill Kidd in a research note Friday.

Netflix fans point to its library of 25,000 DVD titles as a great opportunity for more growth if an Internet delivery solution is in the works with TiVo.

1 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,678.70 +6.10 0.03%
S&P 500 2,057.09 +5.27 0.26%
NASDAQ 4,771.7630 +13.8840 0.29%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs