The proposed $1.1 billion merger of Rovi and TiVo has caused some analysts and observers to see it as a major patent play that will give the combined company more opportunities to drive revenues from lawsuits.
Though a combined company would create a company with a significant patent portfolio focused on video, it’s incorrect to interpret the deal as a “patent play,” Naveen Chopra, TiVo’s interim CEO, SVO and SVP of corporate development and strategy, said Wednesday at the Jefferies 2016 Technology Conference.
The deal, he said, “was not premised on a patent strategy,” but one that is really about creating a bigger products company, a bigger operating company, with more diversity of revenue, more diversity of customers, more diversity of products.”
Though patent fees create upside, “it’s really not the main story here,” he said. “Perhaps the best indication of that is the fact that the company going forward is going to be called TiVo which is something you do if you want to maintain the TiVo product, the TiVo brand, the TiVo interface, and those are really the things that will be driving a lot of the growth going forward.”
Earlier in the discussion, Chopra noted that TiVo’s business has also evolved in recent years, away from hardware to more toward software and services.
TiVo’s business, he said, “has evolved substantially over the last seven or eight years to be at a point where frankly, the hardware is a minor component of the business today.”
And when TiVo enters discussions with MSOs, “they’re not coming to TiVo talk to talk about DVR; they’re not coming to TiVo to talk about a box. They are coming to TiVo to say, look we need to take our video product to the next step, we need to make it more current, we need to embrace OTT and that’s where our software and our services come into play.”
That said, TiVo’s retail/consumer business remains “highly strategic for us,” as it continues to drive the company’s product roadmap.
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