Industry Archives - Page 112 of 145

2007 In Preview: The CableCARD Cometh

Yesterday, we took a look back at 2006 and concluded high definition reaching a critical mass was the story of the year. For 2007, instead of forecasting the obvious (everyone gets HDTV – for less, digital media is everywhere) or making a bunch of wild predictions (Comcast buys TiVo), Dave and I wanted to focus on two notable dates.

Seven-Oh-Seven

If you’re not in the business of broadband or consumer electronics, you’re probably not focused on the upcoming July 1st (7/07) CableCARD deadline. The CableCARD issue is sort of a subtopic in the larger story around the analog-to-digital TV transition. Nonetheless, the de-coupling of embedded security from set-top boxes has its own interesting history, and is worth a quick rundown:

Cable Companies and CableCARD – Once Upon a Time
The difficult thing about making set-tops has traditionally been the embedded security features, called Conditional Access (CA). Two companies – Motorola and Scientific Atlanta – cornered the market on CA, and thus became the primary set-top manufacturers for cable operators large and small. The operators decided they wanted more vendor choices and so supported the idea of separating CA from set-top hardware. Separable security, i.e. the CableCARD was born.

2007 In Preview: All Digital, All The Time

March 1

Come March 1, all televisions and “TV receiver equipment” produced must include a digital (ATSC) tuner. The reason this date is more significant (and more intriguing) than last years deadline to include digital tuners in large TVs is because it encompasses DVRs and placeshifting devices. In 2002 the FCC first proposed staggered tuner deadlines as we transition to DTV and published the final order (PDF) in 2005:

By this action, the Commission is modifying its rules to advance the date on which new television receivers with screen sizes 13-24″ and certain other TV receiving devices such as VCRs and digital video recorders must include the capability to receive broadcast digital television signals from the current date of July 1, 2007 to March 1, 2007. The Commission is also amending its rules to apply the digital television reception capability requirement to new receivers with screen sizes smaller than 13″ on this same schedule. The DTV reception requirement, which also often is termed the “DTV tuner requirement,” is being implemented under an approach that applies it first to large screen receivers and then progressively to smaller screen receivers and other devices over a period of several years. The modifications made herein affect the final step of this phase-in plan. With these changes, the scheduled implementation plan will provide for all new TV receiver equipment to include digital reception capability as of March 1, 2007.

Now there may be some wiggle room in this mandate…

2006 In Review: Higher Definition

Obviously the consumer electronics industry is huge and quickly evolving, so there are numerous products, services, and trends to reflect upon for 2006. Sure we could talk about Apple adding movie downloads from iTunes, the various mergers and acquisitions, PDA phones for the masses, etc… But for me, the real momentum was in the realm of high definition. (And “You” are not the person of the year.)

The major development was the plummeting cost of large screen HDTVs. Plasmas, LCDs, and DLP rear-projection sets all dropped while we simultaneously grew more comfortable with higher price points. When non-geeks have larger, better units than I do (as observed in 2006), it’s safe to say this technology has gone mainstream. (Although, not everyone knows how to get HD programming.)

Also in 2006, the next generation of optical disc technology was released in the form of Blu-ray and HD-DVD. However, neither supplanted DVD last year and it isn’t likely they will in 2007 — due to high prices and a fragmented market. Perhaps hybrid disc technology, such as Warner’s Total HD or LG’s offering, will change the landscape… but not last year and probably not this year.

The Day The HDTV Died

As a die hard HDTV aficionado, I normally love reading about anything that has to do with the HDTV experience. With it’s crisp picture and it’s unmatched sound quality, HDTV has the power to make even bad television entertaining. Even when I’m not watching TV, I still love researching and learning about the technology, but when I came across a recent post by the Technology Evangelist, it sent shivers down my spine. (warning: link is not safe for TV enthusiasts)

It’s New Years eve. My wife and I are snuggled up on the couch watching the ball drop. 10! 9! 8! 7! KABLAM!!! Our micro-projection HD set turns off with a loud popping noise. Immediately I fear the lamp has shattered, but I think that maybe I just sat on the remote and shut it off. Looking at the remote on the table I realize my fear came true.

As someone who watches my fair share of TV, I worry about the day when my tube finally does give out. Reading through the post, I can’t help but imagine how horrible it must have felt to suddenly know that you can’t watch anymore TV without spending the time and money to get repairs done. Right now I’ve been living without my Xbox 360 for a few weeks while repairs are being made and that has been bad enough, without my daily fix of HDTV, I’d be a raving lunatic. (or at least more raving than normal )

Sony LocationFree PPC Player US Release

Third party developer Access will be releasing a Pocket PC software player in the US designed to support Sony’s LocationFree placeshifting hardware (LF-B20). The NetFront LocationFree Player (2.0) should be available any day now for about $20 through Handango and Pocketgear. (For comparison, Sling Media’s PPC player runs $30 direct.) NetFront LocationFree Player for Pocket … Read more

TiVo OS Build For OCAP?

According to a letter the National Cable & Telecommunications Association (NCTA) submitted to the FCC, TiVo is working on an Open Cable Application Platform (OCAP) port. Long term, this seems like an inevitable software engineering initiative if TiVo plans to continue working with the likes of Comcast and Cox. Multiple guides, multiple VOD applications, switched … Read more

Digital Media Bytes

A periodic roundup of relevant news… Pay for TiVo Series3 or settle for cable company DVR: Mossberg, WSJ XBox up on downloads: Variety HD-DVD AACS probably not cracked: Chris Lanier Hands on with the Venice Project: GigaOm Transfer DirecTV TiVo Lifetime service to Series3 (for $200): Weaknees

TiVo By The Numbers: Reloaded

Financial analysis isnât something Iâm prepared to tackle publicly, so Iâve brought in some muscle for a multi-part series on TiVoâs numbers. Obviously this is speculative in nature and just one stockholderâs interpretation of the limited information TiVo chooses to disclose. Your mileage may vary. -DZ

Preface

One of the problems one encounters when doing research, or “digging into the numbers” is that one can always dig deeper. In digging into the later parts of this TiVo story, we discovered that we could derive much more accurate and robust figures (particularly for churn and revenue from subscriptions and advertising) than we had initially. While our general conclusions are the same, the new numbers are so much of an improvement in terms of both accuracy and reliability that we felt compelled to revise them. What follows are revised numbers, some greater detail as to the way we derived them, and some clarification (we hope) of some of the ideas presented in the earlier version. Of particular interest are Appendices A and B, which are all-new, and discuss the way we derive the important churn and revenue numbers. We have also added a new asset class to TiVo’s valuation that we did not consider before. Finally, we have dropped the discussion of ROI and MIRR as they lengthened the article and did not provide much additional insight over the “gold standard” of NPV.

As before, we try at all opportunities to make conservative assumptions. We realize that our assumptions are conservative almost to the point of pessimism, and we have been accused of just that. But TiVo is a company that lives under a great shadow of Wall Street pessimism, so any show of optimism may be seen as a lack of credibility. We leave it to the reader to decide by what factor our estimates need to be adjusted for our excesses of pessimism.

INTRODUCTION

TiVo is an enigmatic company. While management peppers us with regular press releases hyping their latest deal or newest technology, it rarely provides the kind of information we need to put a value on anything â be it a new advertising relationship, distribution deal, or their own financial statements. In this article we will engage in a bit of 8-K and10-Q exegesis in an effort to understand what is really going on at TiVo.