TiVo's Patent Win: What It Means For You
Dish Network owner Echostar is on its last legs in a 6-year-old legal battle with TiVo over DVR technology. An appeals court has found Echostar in contempt for continuing to make and sell DVRs that violate TiVo's "multimedia time warping system" patent, which essentially lets you watch one program and record another at the same time.
You may have heard that TiVo's stocks are soaring on the news, but that's of little importance to consumers (unless they own TiVo stock). Here's a breakdown of how the court's ruling could affect you:
TiVo owners: The court's decision won't have any direct impact on TiVo boxes. But for a company that was once thought dead, the win provides a bit of security. Things are looking up for TiVo lately, so I wouldn't worry about the company going belly-up anytime soon.
Dish network subscribers: Echostar is proposing a new workaround for the patent, hopefully one that will pass muster this time, but that still leaves millions of existing customers whose DVRs infringe on TiVo's patent. Those customers won't be affected, Echostar said. According to USA Today, Wall Street analysts generally agree that Echostar will have to pay a hefty licensing fee to TiVo or replace all the infringing DVRs, though the former scenario seems more likely.
In any case, Echostar's taking its appeal to the full Federal Circuit Court -- only a three-judge panel was behind the most recent ruling -- so Echostar doesn't have to make any rash decisions unless the court declines the company's request for a full review. Echostar losts its last appeal, when the U.S. Supreme Court declined to reconsider TiVo's original victory.
Other television subscribers: TiVo also has lawsuits pending against AT&T and Verizon, and J.P Morgan analyst Bridget Weishaar said this ruling could help TiVo in those other cases. But those lawsuits were launched in 2009. Given that TiVo's case against Echostar is 6 years old, it's way too early for AT&T and Verizon television subscribers to worry about sending back their DVRs.