TiVo lays off 40, creates new unit

Digital video-recorder pioneer TiVo laid off 40 employees and created a new business unit within the company.

The San Jose, Calif.-based company was one of the first to develop digital video recorders, which are essentially VCRs that use a hard drive, instead of a tape, to record television shows. Software developed by TiVo allows DVR owners to program the devices to record shows in the future.

The layoffs reduce the number of company employees to about 200 people, company representatives said.

TiVo also created a new business unit to better support its efforts to license its technology. The company is looking to build on the momentum of a seven-year licensing deal with Sony. The specifics of the deal were not discussed by either company, but new consumer electronics devices integrating TiVo's DVR technology are expected.

TiVo executives expect the Sony deal to bring in revenue through software upgrades, services and fees.

The new unit will be headed by Senior Vice President Ta-Wei Chen.

Licensing is expected to become a bigger contributor to revenue for the company in the coming years. TiVo currently generates most of its revenue from subscriptions. As of July 31, the company had about 229,000 subscribers to its DVR service.

TiVo counts Sonicblue with its ReplayTV technology and recorders and Microsoft TV with its UltimateTV service as competitors.