TiVo, DirecTV Extend Partnership - InformationWeek

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TiVo, DirecTV Extend Partnership

The two companies signed a three-year extension on a deal that has DirecTV supplying subscribers with TiVo personal video recorders. The deal is strategic for TiVo, which faces a crowded competitive market.

TiVo Inc. and DirecTV on Wednesday said they have extended for three years an agreement that has DirecTV supplying subscribers with TiVo's digital video recorder.

The deal, which extends the companies' original 2003 contract, drove TiVo stock up nearly 5 percent to $7.88 a share on the Nasdaq. The original agreement was scheduled to end next year.

Financial details were not disclosed, but the agreement was an important one for TiVo, which draws many of its new subscribers from DirecTV, which is owned by News Corp. For the quarter ended Jan. 31, TiVo added 173,000 DirecTV subscriptions. The company says it has more than 2 million joint subscribers with DirecTV.

Under the deal, TiVo, based in Alviso, Calif., will continue to provide maintenance and support to DirecTV set-top boxes with TiVo service. The two companies will continue advertising each other's products, and have agreed not to assert patent rights against the other.

"By extending our agreement with TiVo, we are ensuring quality support for DirecTV customers who already own a DirecTV TiVo unit," Romulo Pontual, chief technology officer for the satellite TV company, said.

Despite the agreement, however, TiVo's long-term outlook remains cloudy given the increasing competition in the DVR market from cable operators, telephone companies and other satellite TV providers, which offer less-expensive hardware, experts say.

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