Cox Communications, the third-largest cable company in the United States, will promote the TiVo Premiere digital video recorder to its subscribers in conjunction with its own video services. It is the first time that an American cable operator will make its full video-on-demand library available through a retail digital video recorder, while enabling access to competing online video services.
Cox will promote TiVo Premiere as an optional set-top box and provide free installation for subscribers that purchase the $299 product online or through retail outlets. Customers will need a CableCard to access Cox services and will pay an additional monthly subscription fee to TiVo. Subscribers using a TiVo Premiere box will also have access to other TiVo features and media delivered over broadband.
“We recognize that consumers are attracted to a growing range of devices that enable them to access broadband content and interactive capabilities,” said Pat Esser, the president of Cox Communications. Cox plans to start offering TiVo products in its major markets from early 2011.
It is a breakthrough for TiVo in the United States. It follows a similar deal with service providers RCN and Suddenlink. The difference is that Cox will be actively promoting and provisioning the TiVo products, supporting them with installation.
Cox was previously planning to bring TiVo software to Motorola digital video recorders, a strategy also pursued by Comcast. Cox seems to have decided to support the TiVo product instead. The question is whether Comcast, the largest cable operator in the country, will follow suit.
The approach reduces capital expenditure for cable companies that have tended to subsidise digital video recorders, on the assumption that subscribers will see sufficient value in the TiVo product and pay a premium to buy the box.
TiVo pioneered the digital video recorder as a product and became synonymous with it but has failed to gain corresponding market share as service providers rolled out their own boxes. It will potentially boost customers for TiVo which has seen its subscriptions fall by over fifth in the last year to just over 2.5 million.
“This is a major opportunity for TiVo, the cable industry and television viewers alike,” said Tom Rogers, the president and chief executive of TiVo. “This is a terrific cost-effective solution for cable operators looking to deliver broadband content and over-the-top television to subscribers.”
As Colin Dixon of informitv partner TDG Research observes, “it marks a radical departure from standard cable practices”.
A fully integrated search function will return results from broadcast television, locally recorded programmes, the video-on-demand library and online services such as Netflix. This promises to unite programming across different release windows. It means a subscriber could access both the recent episodes of a broadcast programme and previous seasons available online through the same box and user interface, which makes eminent sense for users.
Satellite operator Dish plans to offer similar services through its planned integration with Google TV.
TiVo also has a partnership deal with the owners of the Seven Network in Australia. In the United Kingdom, cable operator Virgin Media also plans to work with TiVo to deliver its next generation of services.