Daily Variety

January 06, 2004, Tuesday

Digital video recording manufacturer TiVo has filed a patent infringement lawsuit against EchoStar, claiming the Charlie Ergen-owned satcaster is inappropriately using some of its so-called Time Warp technology that allows a user to play back one program while recording another.

TiVo filed the suit to protect its 1998 patent in a federal court in Texas on Monday, seeking an injunction against new sales of DVR-enabled boxes along with monetary damages.

Among the key TiVo inventions protected by the Time Warp patent are a method for recording one program while playing back another, watching a program as it is recording and a storage format that supports advanced capabilities like pausing live television broadcast, fast-forwarding, rewinding, instant replays and slow motion.

"We've invested in building a comprehensive patent portfolio to protect our intellectual property and, as the DVR category grows, we will be aggressive in protecting those assets," TiVo chief exec Mike Ramsay said in a statement Monday.

Analysts, however, are dubious about TiVo's chances of fighting off a rising tide of similar technologies being deployed by both satellite and cable operators. Skeptics also note that lawsuits rarely work as a revenue stream, as Gemstar-TV Guide discovered to its chagrin over the past few years of failed patent suits for its on-screen TV program guide.

TiVo is struggling to maintain its brand lead as it faces increasing competition from cable operators that are rolling out integrated DVRs built by set-top makers Scientific-Atlanta and Motorola. TiVo's lucrative distribution deal with satellite leader DirecTV is also in jeopardy as new owner News Corp. is widely expected to start pushing its own DVR box while marginalizing or reducing the royalty rate it pays to TiVo. Currently, some 709,000 DirecTV subs have a TiVo box.