April 13, 2006 3:42 PM PDT

TiVo scores patent win against EchoStar

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TiVo and DirecTV extend contract

April 12, 2006

TiVo sues EchoStar over DVR patent

January 5, 2004
A Texas jury has awarded TiVo $73.9 million in damages after finding that EchoStar infringed on patents held by TiVo for digital video recorders.

TiVo sued EchoStar in 2004 for violating a patent on a "multimedia time warping system," which involved recording a program on one channel while watching another. The case was being closely watched by TiVo investors. The company has struggled to grow as set-top box makers incorporate DVR capabilities in their products.

"This decision recognizes that our intellectual property is valuable, and will ensure that moving forward EchoStar and any others that want to use our patented technology will be required to provide us with compensation," TiVo said in a statement.

EchoStar plans to appeal the verdict, it said in a statement. "This is the first step in a very long process and we are confident we will ultimately prevail. Among other things, we believe the patent--as interpreted in this case--is overly broad given the technology in existence when TiVo filed its patent...Additionally, the Patent Office is in the process of reexamining TiVo's patent, having determined there is a substantial question concerning the validity of the patent."

According to a document filed by the U.S. District Court for the Eastern District of Texas, the jury found that several EchoStar DVRs had "willfully infringed" on the TiVo patent.

EchoStar had argued the patent was invalid and that its DVRs were substantially different from TiVo's. But TiVo's claims were upheld by the jury, which might be a shot in the arm for the company's chances of building a business model around licensing its technology.

"It's not surprising that TiVo won round one," said April Horace, an equities analyst with Hoefer & Arnett. "But I expect EchoStar will appeal the decision. This is just the beginning of a long ballgame."

Horace isn't convinced that TiVo's win on Thursday does much to push forward the company's strategy to boost revenue by licensing its technology to other DVR makers.

"Do I think that the other cable companies, such as Time Warner Cable and Cablevision will automatically sign up and pay licensing fees to TiVo now? The answer is no," she said. "Some people have speculated that would happen if TiVo wins. But I base my predictions on history. And in the past that hasn't been the case."

TiVo lost $34.5 million during its 2006 fiscal year, which ended Jan. 31. This was an improvement over fiscal 2005, when it lost $79.8 million, but the pace of new subscriber growth was down compared with the previous year.

TiVo recently extended its partnership with DirecTV, which competes against EchoStar's Dish Network service. As part of that deal, TiVo gave up the right to sue DirecTV for patent infringement.

CNET News.com's Marguerite Reardon contributed to this report.

See more CNET content tagged:
EchoStar Communications Corp., TiVo Inc., patent, DVR company, DVR

19 comments

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Prior Art?
Tivo patented a "'multimedia time warping system,' which involved
recording a program on one channel while watching another".

I could watch one channel and record another with my old VCR.
Tivo's time warping (despite its unusual name) isn't exactly a new
concept.

I just don't see how something like this is patentable.
Posted by sbwinn (216 comments )
Reply Link Flag
Read the Patent - It's Actually Quite Amusing ...
and is a good example of how to write a patent that will not only result in award (not all that hard, really, especially since the assigned patent examiner is _required_ by law to provide assistance to the entity applying for the patent to make it as patentable as possible). It's one of those "peel the onion" deals, where you make a basic claim, and then make additional claims to expand the applicability to as many other uses as possible. I haven't looked at the court documents yet, but the story didn't say whether any of TiVo's claims had been invalidated by the court. That could be critical in determining what can be appealed, and therefore, on the other hand, what will be enforceable, after the entire process has been completed (years and years from now, most likely).

As for the VCR comparison, go look at the patents for that technology and let me know where you see any overlap in the claims. You can't fast-forward and rewind a VCR tape while you're both watching the speeded-up video _and_ continuing to record to the tape. That's just one of the features that TiVo is claiming, and is the crux of the time-warping concept. Anyone who thinks a DVR is just a fancy VCR obviously needs to get out and take a look at a few other recent new-fangled inventions, like the internal-combustion engine powered automobile that appears poised to threaten the horse-drawn buggy market, fer instance! ;)

All the Best,
Joe Blow
Posted by Joe Blow (175 comments )
Link Flag
it is just one small part of it
time warping that is. You have narrowed it down to a single term, "time warping". Notice this term says nothing of being able to record while watching another. It is a label for a patent that covers the crux of the DVR concept. Notice it does not need two casette tapes to record and play at the same time. It also does not have a display that flashes "12:00" like you'd find in most VCR owners home.
Posted by anyhonestman (6 comments )
Link Flag
it is just one small part of it
time warping that is. You have narrowed it down to a single term, "time warping". Notice this term says nothing of being able to record while watching another. It is a label for a patent that covers the crux of the DVR concept. Notice it does not need two casette tapes to record and play at the same time. It also does not have a display that flashes "12:00" like you'd find in most VCR owners home.
Posted by anyhonestman (6 comments )
Link Flag
Last Out in the Bottom of the First Inning of the DVR World Series ...
and TiVo had better hope for no more than nine innings per game for no more than four games, assuming it can hold onto enough cash for even that long (which the recent DIRECTV extension might provide, along with the Comcast deal that will only essentially cover engineering development costs through this year - cable MSOs are notoriously cheap buggers).

As a patent holder myself, and someone with tentacles that reach inside TiVo, I know that at least one glass of champagne was raised there, but not much more than that, given their financial situation. The appeals process will take years, and even if TiVo manages to win that, they're going to have to pry the money out from someone's cold, dead fingers, but by then, the only ones who will get the money will be lawyers.

However, they can now sue others using this as precedent, if they have the money or can get lawyers to take the case(s) on a contingency basis, but that just means the lawyers get even more, in the end (and, oh, wouldn't we just all love to see that happen, in a somewhat different way? ;) ).

I've got my popcorn and hot dogs here behind the dugout. Play ball!

All the Best,
Joe Blow
Posted by Joe Blow (175 comments )
Reply Link Flag
A thought.
I understand the fact that the patent system in the
US is broken, but, consider what TiVO was and is
and what we had just a few short years ago before
TiVO came along. It occurs to me that if anyone has
a right to a patent it is this company. Consider the
term "TiVO" or "TiVO'd" which has become common
vernacular when talking about current methods for
time-shifted DVR recording. It is indeed an unique
invention of this company and if you sell products
similiar to a "TiVO", you need to recognize the fact
that you are using their idea.
Posted by Johnny Mnemonic (374 comments )
Reply Link Flag
First to market but not innovative
Tivo was the first to market a complete package but the "capability" they provided in their product was already available to anyone who had a PC with more than one tuner in it.

What Tivo did was to put those capabilities into a nice package but then they got lazy and greedy. Their greed showed in their idea of making their users pay a monthly subscription for a directory of programs instead of making it an open system that could be provided by any carrier at no cost.

That greed is ironic because it's what has cost them the market. Without that extra cost I and millions of other homes would've gone ahead and bought one and the companies biggest problems would've been how to provide as many systems as the consumers want.

The laziness is evident in their slow innovation, such as including HD capability. HD is important and since their greed limited their market to those willing to spend more on their televisions their own market left them behind as they moved to HD which their Tivo wouldn't support.

Tivo'd is soon going to be a term which describes companies that have one good idea and then die because of a failure to follow up.
Posted by aabcdefghij987654321 (1721 comments )
Link Flag
neither first nor innovative concept
Tivo was not the first. ReplayTV was out first (by more than a year) as a stand alone box. Also, the concept was already done on computers with TV tuner cards. All Tivo did was come up with a great UI and marketing blitz. That is the only thing they invented and they have no right to a patent on something that was already in use elsewhere.
Posted by (4 comments )
Link Flag
Patent news update!
Did you hear the news? The court's decision was just handed down a few minutes ago, so it probably won't appear here until tomorrow.

In a combined federal suit, Intel and Microsoft have successfully sued Apple to stop all production of its Mac computers due to patent infringement. The suit alleged that Intel and Microsoft had the idea of "information processing units" (commonly referred to as "computers") first, and Apple was in clear violation of this. All production and distribution of Mac computers is to be halted at midnight tonight.

In related news, the jury in the TiVo case, with plenty of time on their hands having only spent six minutes in deliberation, was asked by the judge to rule on similar cases. They reversed an earlier ruling and awarded full damages to Amazon.com in its "1-click shopping" suit against Barnes & Noble, thereby shutting down 2,637 shopping sites using the same method.

They then turned their attention to the current Netflix suit against BlockBuster and awarded full damages to Netflix for its remarkable, innovative "queue" concept.

In national news, Mexican "freedom fighters" (formerly known as "illegal aliens") have successfully sued the United States government, claiming Mexico had the idea of "putting the nation's symbol on a piece of cloth and waving it" first. Henceforth, all public buildings in the U.S. must display the Mexican flag or no flag at all.

Stay tuned tomorrow for more exciting patent news!
Posted by Joe Bolt (62 comments )
Reply Link Flag
hey charlie
or should I say Joe Blow? Stop your sarcastic drivel, it ain't going to help you. face it, Tivo is here to stay. Tivo owns the DVR.
Posted by anyhonestman (6 comments )
Link Flag
one sided article
why does cnet publish an article that is so one sided? Why are you so against Tivo? Why did you omit the important information regarding the law suit Tivo won and the DirecTV deal? When will you quit bashing Tivo?
Posted by anyhonestman (6 comments )
Reply Link Flag
When TiVo actually accomlishes something....
...They're acceptable as a TV service, but hardly commercially
viable. TiVo lacks serious leadership, and one of these days, that
will catch up with them. In the meantime, you might have a small
point.
Posted by Earl Benser (4310 comments )
Link Flag
What about Bob?
What about the cable companies that are using this DVR technology? Is there lawsuits against them yet?
Posted by Syndicate5 (1 comment )
Reply Link Flag
 

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