Some more reaction and analysis of Cablevision’s remote DVR win, which we wrote about earlier today:
– a statement from Cablevision (NYSE: CVC) COO Tom Rutledge: “We are mindful of the potential implications for ad skipping and the concerns this has raised in the programming community. We believe there are ways to take this victory and work with programmers to give our customers what they want — full DVR functionality through existing digital set-top boxes — and at the same time deliver real benefits to advertisers.” Slightly unclear here on details about how this would work for advertisers, though. Also, the company expects deploying the first application of this new technology, the ability to pause live TV when the phone rings, later this summer, it said. And then, he rubbed it in: the point about edge over satellite providers Dish and DirecTV.
– Sanford Bernstein analyst Craig Moffett has come out with an initial reaction to this: he estimates that DVRs account for as much as 10-15 percent of major cable’s capital spending, though with some caveats: “However, Network DVRs require significant downstream capacity to substitute for the equipment at the edge of the network, and therefore are likely limited to deployment only after deployment of switched digital video, all-digital, and/or other capacity reclamation projects. We therefore expect Cablevision to capitalize first, Comcast (NSDQ: CMCSA) to capitalize second (albeit likely a few years down the road), and Time Warner (NYSE: TWX) Cable slightly later. “
– Meanwhile, shares of TiVo (NSDQ: TIVO) declined slightly about 4 percent today on the ruling. In a client note, Janney Montgomery Scott analyst Tony Wible said this could be a negative for Tivo, by leading to a new debate over the company’s patent, reports AP. Since TiVo has said its patent doesn’t state where the DVR’s hard drive is located, a cable provider using networked DVRs “would still potentially be in violation of the TiVo patent,” he said. It could also mean Tivo could try to enforce patents against cable cos. On the positive side, Tivo has started to embed its software into cable companies’ services including Comcast and Cox, instead of the box service, so any increase in DVR usage could help it in the long run. “That could give TiVo a larger opportunity to grow and present more incentive for (studios and cable system operators) to back TiVo’s DVR advertising service,” Wible said.