Kiplinger Suggests Tivo Stock as a Good Investment but is it

Tivo a company that has lost $150 million over the past four years. Most cable and satellite providers are already offering their version of a DVR. Some may be licensing patents from Tivo, but unless Tivo has the power and will to pursue more patent litigation, their hope for continued growth will continue to diminish. When users can get a DVR for $5 per month as part of their cable to satellite bill, why would they go out and purchase a standalone Tivo?

And what’s next? DVR’s built into your flat screen TV. Yup…the next TV you buy may include a hard drive with DVR functionality right inside. I was models from LG displayed in at an expo in Bangkok last week. In an effort to combat ever decreasing prices for flat panel TV’s the manufactures will be adding new capabilities such as DVD Recorders and DVR’s into TV sets.

Tivo as as stand-a-lone product and it’s earlier rival Replay TV have were both false starts. Tivo has enough money and cool enough name that it became the “Kleenex” of DVR’s. The DVR will forever be called a Tivo long after the company with the name expires, but Tivo as a hardware company will not survive. Tivo as a Patent Royalty collection company, could be quite lucrative if they have strong enough prior art to rest their laurels.