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TMO Exclusive - Analyst Denies TiVo/Apple Report; Rumors Abound

by , 2:45 PM EST, February 24th, 2005

A report of an impending buyout of digital video recorder (DVR) maker TiVo by Apple Computer was denied Thursday by the analyst quoted in a recent story by the Reuters news agency. Despite the denial, shares of TiVo (TIVO) were up for a second straight session Thursday amid speculation.

Steven Kroll Jr., an analysts with Monness, Crespi, Hardt & Co., told The Mac Observer he did not confirm to Reuters that there were plans for the iPod and Mac maker to buy TiVo, but that there were widespread rumors of such a deal.

Mr. Kroll is quoted as saying, "What we hear on the street is that Apple is interested in their business and that they are a takeout target." Mr. Kroll told TMO he simply repeated the reported rumor which had been broadcasted for days on the financial news network CNBC and that he is not aware of any deal in the offing.

The brokerage firm Smith Barney said Thursday it is "highly unlikely" Apple will acquire TiVo.

"It appears as though Apple want to stay focused on selling select proven products (e.g. iPod) rather than gambling on unknown initiatives," a commentary obtained by TMO from Smith Barney stated. "Second, Apple indicated that the DVR market seems to be a commodity whereby all players will eventually have similar hardware and software longer term, which means that the DVR market really boils down to marketing and branding. Apple clearly already has a strong brand and would not gain much from acquiring TiVo. If Apple were to get into the DVR market, we believe they would build a proprietary product."

While the TiVo has become the Macintosh of the DVR market, with its users often described as die-hard and fanatical fans, the company has been viewed harshly by Wall Street because of its inability to grow its subscriber base fast enough to become profitable.

Other companies, including media giants Time Warner and Comcast, and its erstwhile satellite TV partner DirecTV have also been discussed as potential suitors for TiVo in recent months.

TiVo CEO Mike Ramsay, who recently announced he would step down from that position, has repeatedly said his company was not for sale, but the company's low market cap of $354 million has fueled takeover speculation.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:Mace Posts: 9604 Joined: 07 Aug 2003
Subject:

Highly unlikely that Apple will acquire TiVo. Subscribers of TiVo services hope that someone will acquire TiVo so that TiVo will survive. IMHO: TiVo is becoming as irrelevant as pure PDAs.

Close Name:pourhadi Posts: 55 Joined: 15 Aug 2004
Subject: TiVo

In my opinion, TiVo is the best thing since the Mac. Because of piles of work and limited time, I barely ever watch TV. Thanks to TiVo, I can sit down Friday night and watch the shows I missed over the week.

I have two TiVos. How I ever lived without even one, I'll never know.

I hope TiVo isn't going anywhere. Last thing I want to do is have to go out and buy a Windows Media Center.

Close Name:iggyb Posts: 112 Joined: 09 May 2003
Subject: I like the idea

Quote
Mace wrote:
Highly unlikely that Apple will acquire TiVo. Subscribers of TiVo services hope that someone will acquire TiVo so that TiVo will survive. IMHO: TiVo is becoming as irrelevant as pure PDAs.


Careful there...that's what many 'pundits' were saying about the Mac back in '98.

Perhaps TiVo does need something else...a marriage with Apple and TiVo to create a Media Center would have quite the appeal...

Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject:

That analyst probably had some friends who needed to offload their Tivo stock. Now that its up they won't lose as much money when they sell it!

Close Name:Guest
Subject: What would be good...

Is for Tivo and Apple to pair up. Tivo Software is linux based and I'm sure could be ported to Apple hardware with some ease. Then you add a TV tuner, optical out, video out, connect it to the MacMini via firewire and use Tivo's content to drive it for a much lower per/month price. Apple would of course make the add on product.

Tivo would win by not having to build/supply hardware, Apple would of course win by getting more hardware out the door.

Close Name:Guest
Subject: Remarkable!

It is just remarkable that an unsubstantiated rumor can cause the TiVo stock frenzy we've seen over the last two days. Today over 26 million shares changed hands. Wild.

As for the rumor, my intuition is that Apple will not buy TiVo, as Steve Jobs seems to have resisted the computer/TV connection.

On the other hand, Apple has bought into strategic markets over the last few years (mainly music-related acquisitions). And there have been other signals of late that Apple is interested in a movie platform (e.g., Robert X. Cringely's recent column). So it remains to be seen...

Like one of the other posters, I believe the TiVo is very relevant. It is rock-solid, robust platform with an elegant user interface (sound familiar?). My family has three in my home, and we time-shift virtually everything, usually watching the bulk of our recordings on the weekend.

Close Name:jimothy Posts: 612 Joined: 04 Jun 2004
Subject:

Quote
pourhadi wrote:
In my opinion, TiVo is the best thing since the Mac. Because of piles of work and limited time, I barely ever watch TV. Thanks to TiVo, I can sit down Friday night and watch the shows I missed over the week.

I have two TiVos. How I ever lived without even one, I'll never know.

I hope TiVo isn't going anywhere. Last thing I want to do is have to go out and buy a Windows Media Center.

But could you say the same thing about a DVR from a vendor? That's the important question. It's not whether TiVo has a good product or not, it's whether they can differentiate themselves enough from the competition and grow subscriber base enough in face of increasing competition to become profitable.

Apple's purchase of TiVo would make about as much sense as HP's purchase of Compaq, which viewed in hindsight was a huge mistake. Apple wouldn't get anything out of the deal they couldn't develop themselves. TiVo's most valuable asset is their brand name, and if you recall, Apple's got a pretty good brand name already.

Close Name:Guest
Subject: I;ve had a Cable DVR and TiVo and there is a HUGE difference

The same difference as between a Mac and a Windoze machine. Ease of use - intuitive functions. Tivo is NOT a generic DVR - anyone who thinks so is uninformed.

Close Name:Nom Posts: 58 Joined: 07 Jul 2004
Subject: Illuminate the ignorant

Why the references to TiVo "subscribers"? From my understanding of TiVo technology, it works basically like a DVR - record at one time, then play back later. Where does a subscription stream come into it, and why is this useful / necessary / part of TiVo's business model?

Close Name:Guest
Subject: Illuminating the ignorant

You have to subscribe to the "Tivo Service" to get TV show times and channel numbers. The service keeps the Tivo unit up-to-date with show times and changes that occur on a daily and weekly bases. As a user, you then make your selections from the unit and it records those shows for you.

Close Name:Guest
Subject: Re: Illuminating the ignorant

The subscription comes in when you want the unit to be smarter than a VCR/DVR (i.e., more than time/channel-based recording).

Would you like it to automatically locate all showings of a particular program on a given channel? Would you like it to record programs you might enjoy based on your viewing habits and ratings of other shows? Do you want "enhanced content" (i.e., expanded commercials, previews, etc.)? Um, never mind, forget about that last one. :-/

Close Name:Guest
Subject: we need a tivo-like device

out here my family would absolutely love a Tivo-like device. right now, my dad has to program the VCR (remember those?) and the Satellite set-top box separately. in the country i'm in, there is basically only one major cable/satellite company... it has great content [hbo, cinemax, cnn, bbc, al-jazerra!, DWtv(german news channel in english), cnbc, discovery, nick, etc.. etc..] but has shown ZERO interest in developing an all-in-one DVR and Satellite decoder device.

i have not used Tivo myself when i was in the USA, but i tell you, my dad would definitely get something Tivo-like, made by Apple or Tivo or whatever (not microsoft though) that is

1. an all-in-one receiver and DVR
2. with simple, uncluttered, up-to-date recording interface
3. 40 hours+ would kick ass
4. works seamlessly with out cable/satellite monopoly provider*

*well, it's kinda a monopoly because their the first company in my dad's country to ever launch their own satellite into space, off a french arianne rocket....

Close Name:Guest
Subject: bonus points

extra credit for whoever figures out what country i am talking about above.. hint, starts with an M

Close Name:Mace Posts: 9604 Joined: 07 Aug 2003
Subject:

Mexico?

Close Name:Guest
Subject: DVR

I have no clue what DVR is nor have ever seen a TiVo since I live in Japan.

We got HardDrive/DVD/VHS machines over here that let you record what ever you want. I've got a 250HD non-VHS machine and don't need a scription service for anything. hehe, record and burn what ever I want now.

Legality ???
Heck if I know but to say the bare minimum, they're advertised on TV using Bob Sapp (ex-Football player, now K1 fighter) and are sold at most stores.

hehe, so why should Apple buy TiVo ??? Makes no sense to me, unless it has something to do with American copyright.

Price range:
$200 - $1500

cheers.

PS -- quote me if you want but please remember to give credit too.

Close Name:Guest
Subject:

Quote
Mace wrote:
Mexico?


Malaysia... Good try though...

Close Name:Mace Posts: 9604 Joined: 07 Aug 2003
Subject:

West Malaysia? Definitely cannot be Sabah or Sarawak. Sorry have been away for many years didn't know that Malaysia has HBO.

One guess, you live in Kuala Lumper?

Close Name:Guest
Subject:

Oh, let's see Apple for the living room. Do you need Apple to do everything for you? How about an Apple branded toothbrush? An Apple branded dishwasher? An Apple etc,etc.

Close Name:Guest
Subject:

Quote
Mace wrote:
West Malaysia? Definitely cannot be Sabah or Sarawak. Sorry have been away for many years didn't know that Malaysia has HBO.

One guess, you live in Kuala Lumper?


they sent a satellite up into space (on french-made arianne rocket), it's geostationary so it covers a fairly decent chunk of south-east-asia 24/7... sabah and sarawak you can get it now i think... on the ground the receiver dish is pretty small, quite impressive really...

yeah HBO, etc. etc. like i mentioned check out www.astro.com.my that's the satellite tv service...

umm... one thing though, everything is censored to a PG-13 level movies, etc etc... and of course no adult channels

Close Name:Guest
Subject:

Quote
Mace wrote:
West Malaysia? Definitely cannot be Sabah or Sarawak. Sorry have been away for many years didn't know that Malaysia has HBO.

One guess, you live in Kuala Lumper?


hmm... grew up in KL, then went to singapore, brisbane, melbourne, san francisco, sydney, now "back" living with my parents in KL... long story

Close Name:Guest
Subject:

Quote
Guest wrote:
Oh, let's see Apple for the living room. Do you need Apple to do everything for you? How about an Apple branded toothbrush? An Apple branded dishwasher? An Apple etc,etc.


i would like said toothbrush if it had 1GB of flash memory and also doubled as a mp3 player

Close Name:Mace Posts: 9604 Joined: 07 Aug 2003
Subject:

Quote
Anonymous wrote:
Quote
Guest wrote:
Oh, let's see Apple for the living room. Do you need Apple to do everything for you? How about an Apple branded toothbrush? An Apple branded dishwasher? An Apple etc,etc.


i would like said toothbrush if it had 1GB of flash memory and also doubled as a mp3 player
I get it. Apple and Proctor & Gamble-Gillette should merge.

Close Name:rkfoster Posts: 32 Joined: 06 May 2004
Subject: It might be a good move...

Apple would acquire the TiVo brand name if it bought the company. Apple could keep it a separate company and provide capital for it to grow. Apple would gain any technology ideas that it doesn't already have in the area of digital video. Apple would acquire the customer base of the existing TiVo subscribers and add to the iPod "halo" effect (TiVo halo effect anyone?). If TiVo is a deadend technology (highly debatable) then Apple would certainly have ideas for what to do to get it on a new road. After the digital audio revolution what's next? Digital video. Apple certainly has some sort of plans for digital video, they were way ahead on digital audio with the iPod/iTunes products. There has to be some sort of hardware device for digital video, SJ has said that video doesn't make sense in a "pod" pocketable form factor and I agree with him on that. The movie industry is looking for an answer for digital video.

If TiVo is looking to be bought out then why shouldn't Apple buy it? Other then the money lost from their cash reserves.

Close Name:Smith Posts: 13 Joined: 16 Feb 2005
Subject: Apple's New Strategy

Quote
rkfoster wrote:
Apple would acquire the TiVo brand name if it bought the company. Apple could keep it a separate company and provide capital for it to grow. Apple would gain any technology ideas that it doesn't already have in the area of digital video. Apple would acquire the customer base of the existing TiVo subscribers and add to the iPod "halo" effect (TiVo halo effect anyone?).


Apple renames the Switch Campaign "the halo effect." "By buying TiVo, Apple increases it's halo effect," the AppleScripted MacTrons say.

Close Name:Guest
Subject:

Mac idiots.

Close Name:jacrav Posts: 268 Joined: 04 Jul 2001
Subject: Don't forget to set your Tivo for the new comedy show …

Smith and Guest !
Brought to you by RC, Inc.

Close Name:Guest
Subject: Re: Don't forget to set your Tivo for the new comedy show â€

Quote
jacrav wrote:
Smith and Guest !
Brought to you by RC, Inc.

Mac idiots.

Close Name:Guest
Subject: apple/tivo

If apple buys tivo for $350 with its 3 million
and offers the imac mini at a sweet price, there
could possibly be a million plus almost instant
mac switchers. TiVo users obviously 'get' the one-
step-ahead technology the apple epitomizes; a connection
at a deeper level than price.
ps microsoft will be gone in less than 10 years

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