, through its deal with
Unbox service, shows signs of coming back to life.
In itself, the Amazon Unbox-TiVo relationship may not help sell more TiVo boxes or attract new subscribers, but along with the deals TiVo has inked with cable-service providers
and Cox Communications, this one indicates that TiVo is getting its act together again and taking it on the road.
The Comcast deal has been in the works for more than a year now, and TiVo signed its agreement with Cox in August.
Despite the 9% bump up after Wednesday's announcement to $5.97, TiVo stock is down nearly 40% from its 52-week high of $9.49.
The Amazon Unbox video-download service
, which launched in September 2006, offers movies, TV programming and other videos for download to PCs and any Windows Media Video-compatible portable device.
With the new service, in addition to PCs and portable devices, movies and TV shows will now be available to download directly to a customer's TiVo box for playback on TV sets.
"Amazon Unbox offers customers the flexibility to watch their favorite videos where and when they want, whether that is on their PC, portable device or TV set through their TiVo box," said Bill Carr, vice president of digital media at Amazon.
Customers can purchase TV episodes for $1.99 or movies for $9.99 to $14.99, or rent movies starting at $1.99. All purchased videos are stored in each customer's media library at Amazon for future access and download.
Though it's an interesting value addition for TiVo customers, for TiVo itself the service might not amount to much, says Todd Chanko, a media analyst with JupiterResearch.
"I don't think anybody is under the illusion that TiVo is suddenly going to ramp up sales of stand-alone boxes and ramp up subscriptions," he says. "So the real question is, what can TiVo leverage to propel itself ahead, and what we have here is an example of TiVo using its IP to do just that."
The deal also could render content aggregators and distributors more open to using the TiVo platform, and that could translate into increased partnership agreements for TiVo.
For Broadband Only
As for the Amazon Unbox-TiVo service, it will work only for broadband-ready devices. TiVo has about 1.5 million broadband-ready boxes, but only about 500,000 are actually connected to broadband, estimates Murray Arenson, an analyst with Ferris, Baker Watts, which makes a market in TiVo shares.
Plus, Unbox is missing some big studios in its service, such as
"The deal with Amazon is a net-positive for TiVo, but it does not significantly affect the outlook for the company," wrote Arenson, who has a neutral rating on TiVo.
"The value of this arrangement is based on its ability to drive subscribership for TiVo's stand-alone business, and we expect the impact to be marginally positive," Arenson says.
In the short term, the Unbox deal might not do much for TiVo shares, but what's important to note, says Chanko, is that TiVo is not standing still.
"It is important for TiVo to
continue offering value-added services," he says. "It helps keep the brand alive."
In November, TiVo launched a service that would enable subscribers
to transfer broadband video from their PC to their television sets, even if those videos didn't originate in a TV format.
But TiVo's bigger break is likely to come from the Comcast and Cox partnerships. Comcast is expected to start offering its subscribers an option to upgrade to TiVo boxes this spring.