TiVo wins KDDI voice extension deal – investors unimpressed

TiVo has just scored a major deal extension for its voice remotes at giant Japanese telco KDDI, in the same week that it rolled out a new personalized discovery platform. The newly merged TiVo-Rovi outfit has created a well respected company with some genuinely valuable intellectual property at its disposal, yet its seemingly successful trajectory has not done its share price any favors, slumping around 4% from this time last week. In fact, its share price has never recovered since the merger closed last September.

KDDI is deploying the G-Guide HTML on its cable set tops, reaching a base of 5.3 million subscribers, to build on its existing deployment of the G-Guide on KDDI’s IPTV set tops, which it rolled out last year and was the first product to use the G-Guide HTML for IPTV.

The deal includes the adoption of TiVo’s G-Guide xD which allows remote recordings to be triggered from smartphones. This is the key factor here, as KDDI’s cable TV subscriber base is tiny compared to its mobile subscribers – boasting over 48.5 million on mobile at the end of the first quarter, the second most in Japan after NTT Docomo.

With Japan being a trend-setter in many aspects of the technology world, getting its voice and search functions into millions of mobile phones is a prime test of the technology’s scale and functionality in a highly advanced nation. If it can survive the demanding consumer test in Japan, it could survive anywhere.

The idea is to help viewers easily find and record TV programs by using their smartphones or tablets. The picture-in-picture TV guide listing grid shows rich images, including program and cast photos. G-Guide HTML helps viewers to smoothly switch from one program to another and displays the connections between actors and programs and their interrelated associations. TiVo calls the concept “a six-degree discovery capability.”

Having said that, KDDI runs the Video Pass SVoD service which is available on eight platforms including Android, iOS, Chromecast and various set tops. TiVo confirmed to Faultline Online Reporter that none of its technologies power Video Pass at this time.

On to this week’s launch, which TiVo is calling its new fully-integrated Personalized Content Discovery platform. It says it provides operators with a combination of its content discovery features with voice search, recommendation software and analytics capabilities. TiVo gives the example of when users ask, “What’s on TV tonight?” the platform will generate a list of the top 10 television programs that the user is most likely to be interested in, based on their viewing behavior, rather than bombarding the user with over 300 channels.

Elsewhere in Japan, electronics manufacturer Sharp uses TiVo’s G-Guide in its Aquos Blu-ray disk recorders. While in the US, TiVo recently won the approval of an initial ITC determination that both Comcast and its suppliers, Arris and Technicolor, infringe its patents. Comcast was the only one of the top ten pay TV operators in the US which had refused to renew its license, and estimates have pegged the deal as adding as much as $14 million to TiVo’s quarterly revenues.

Earlier in May TiVo came out with better than expected financials for Q1 and broke out its IP licensing, now making up around 45% of its revenues, doubling to $63 million since the merger, and it has new licenses at Roku, Discovery and Dwango. It also has operators signing license agreements covering TiVo Advertising and its extensive entertainment discovery IP portfolio.

All of these recent moves suggest the TiVo of today is evolving into a company aiming to take on Amazon in the smart home sector – where it will find itself joining a lengthy queue of companies with similar ambitions in a congested market. That might be one clue to its share price problems.

“Japanese consumers are often ahead of the curve when it comes to technology adoption so this latest development is a testament to KDDI’s dedication to providing its customers with new functions to enhance their entertainment experience,” said Michael Hawkey, SVP and GM, User Experience, TiVo.

Pratik Patel, director of product management, Advanced Search and Recommendations, added, “Thanks to our fully-integrated approach, service providers can provide their customers with the flexibility of conversational search, going beyond traditional keywords and delivering a truly personalized experience that also drives their own business objectives internally. In the past, it was an incredibly timely and labor-intensive process to update search results. Now, changes can be created almost instantaneously, generating stronger, more relevant results for viewers while improving overall customer loyalty and engagement.”

TiVo technology is behind the Comcast voice remote used on the X1 in the US, which over 13 million homes use.