TiVo starts sales of premium TV video recorder
Tue Sep 12, 2006 6:26 AM BST
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NEW YORK (Reuters) - TiVo Inc. (TIVO.O: Quote, Profile, Research) on Tuesday started selling its latest digital video recorder which is capable of displaying high-resolution TV signals, as the recording technology company seeks new subscribers among buyers of premium home theater systems.
TiVo, whose service remains popular despite tough competition from far larger cable and satellite providers, said its Series3 HD Digital Media Recorder will be available on the company's Web Site this week and in some electronics stores later this month.
At about $800, the DVR is expensive for a cable set-top box, a device that many consumers receive for a negligible monthly fee from their TV provider.
TiVo marketing executive Jim Denney said the DVR, which boasts high-end features such as THX performance, which ensures quality and resolution, will eventually be able to download programs, perhaps like how songs are sold on Apple Computer Inc.'s iTunes.
He said the DVR also meets the needs of buyers eyeing high-definition flat screen TV and add-on audio systems.
"We think that there is a category of customers that have been waiting for it, and want it," he said. "We know that $800 is not an insignificant amount of money. But we put a lot in it. We think that it targets a specific audience."
The set-top box, made by a contract manufacturer for TiVo and originally unveiled in January, will have two tuners, so that cable TV subscribers can record two different shows in high-definition at once, while watching a third prerecorded show. Users can save up to 32 hours of HD programming, or up to 300 hours of standard definition.
Subscribers will continue to pay around $13 a month, although a variety of pricing packages are available, the company said. The company has about 4.4 million subscribers, but only 1.5 million who do not subscribe to the DirecTV's satellite service run by News Corp. (NWS.N: Quote, Profile, Research).
The new product announcement came only two weeks after TiVo posted a deeper second-quarter net loss due primarily to the effects of its intellectual property patent litigation, more upfront hardware costs and the expensing of stock options.
TiVo shares are up sharply this year, boosted recently by a legal win in its patent dispute against EchoStar Communications Corp. (DISH.O: Quote, Profile, Research) and a new distribution pact with Cox Communications, the fourth-largest U.S. cable provider.
But many analysts remain reserved about TiVo's growth potential, citing its unproven plan to gain subscribers by sharing DVR software -- rather than making their own boxes -- with cable providers. For instance, a distribution deal with Comcast Corp. (CMCSA.O: Quote, Profile, Research) announced more than a year ago has yet to yield either a set-top box or subscribers.