Reuters, 05/24/2001 16:04
UPDATE 1-Tivo shares jump on TV recorder patent win
(recasts first paragraph, adds details, stock activity)
SAN JOSE, Calif., May 24 (Reuters) - Shares of TiVo Inc. (NASDAQ:TIVO) jumped 35 percent on Thursday after the company said it had won a patent for technology that allows the pausing and recording of live television broadcasts.
The shares powered up to a session high of $6.75, its highest levels since early February, although it remains far off its 52-week high of $37.50. In afternoon trading, the stock traded at $6.60, up $1.66 a share.
The San Jose, California-based company said the patent covers a method for recording one program while playing back another, a method to process various video and audio streams at low cost, and a storage format that allows television watchers to pause and scan through live television, TiVo said.
TiVo applied for a patent for its "Multimedia Timewarping System" in July 1998.
"We are pleased that TiVo is receiving formal recognition for the invention of unique and novel technologies -- underpinning the making of Personal Video Recording devices," said Jim Barton, TiVo's chief technology officer.
Personal video recorders have caught on among many television viewers as a major advancement of the video cassette recorder, or VCR. TiVo, which says it was the first to market such a product, faces competition from Ultimate TV, a new product from Microsoft Corp. (NASDAQ:MSFT), the world's largest software company.
A TiVo spokeswoman was not immediately available to comment on whether the company will use its patent to challenge the technology in its rivals' devices. Microsoft was also unavailable for comment.
TiVo shares were bruised on May 1 after rival ReplayTV Inc. signed a licensing pact with Motorola Inc. (NYSE:MOT), the biggest maker of set-top digital TV devices. News of Motorola's deal with ReplayTV, which in March agreed to be bought by SONICblue Inc. (NASDAQ:SBLU), may have appeared as if TiVo was dragging its feet in attempts to strike similar pacts, analysts said.
Since May 1 -- and fueled primarily by Thursday's rally -- the stock has outperformed the S&P 500 by about 30 percent.
Looking ahead, analysts predict that the pause-rewind-replay function found in TiVo machines will eventually be licensed and knitted into the majority of smart-cable and set-top boxes.
But they do not expect interactive television to become mainstream until about 2005, when high-speed services are more prevalent and about 55 percent of U.S. homes will have digital set-top boxes.
Personal video, one of the features of interactive television involving users' ability to pause and playback live TV, is already popular. Internet research firm Forrester Research projects 8.2 million households will have personal video recording by 2002.
Copyright 2001, Reuters News Service |
