June 2, 2003 3:54 PM PDT

TiVo service tracks viewer data

TiVo announced on Monday that it will sell limited information about the viewing habits of its subscribers to advertisers and broadcasters.

The company's new service will let broadcasters and advertisers subscribe to a quarterly audience-measurement report that will track viewing habits during prime-time shows. TiVo, which provides digital video recorder (DVR) services and devices, eventually plans to use its technology to provide data on consumer patterns for any show or commercial.

"We want to embrace the opportunity to help advertisers and broadcasters better understand the current and future impact of DVR so they can adapt content and advertising strategies to better understand this new medium," Martin J. Yudkovitz, president of TiVo, said in a statement.

San Jose, Calif.-based TiVo makes DVRs that let people tape live programming to a computer hard drive; pause, fast-forward or rewind on demand; and skip over commercials. The technology also detects consumers' viewing habits and can record shows related to their tastes.

The device connects daily to TiVo's main servers to retrieve and download programming data. That underlying technology puts TiVo in the catbird's seat to analyze the viewing patterns of its customers. The data is kept in aggregate, however, and does not reveal individual information, according to the company.

The new service is the latest move by the company to eke revenue out of its modest base of 700,000 subscribers. In late May, TiVo announced that it lost $7.9 million on revenue of $28.5 million for the quarter and hopes to expand its audience to more than 1 million by next January.

Josh Bernoff, principal media analyst for Forrester Research, thinks that, although the added revenue will be modest, it could help the company.

"I think it could be a little revenue," he said. "TiVo is in a situation where any revenue-generating ideas are important towards the goal of making the company profitable."

While the slow economy could make selling research difficult, the authoritative data that the company has to offer could pique advertisers' interest, Bernoff said.

"The number of people that want to know the truth about viewing habits and ad skipping is large," he said.

While TiVo's announcement made no mention of the potential privacy implications of selling data, a representative of the company was quick to dismiss the issue.

"This doesn't change, in any way, how TiVo has treated data," said the company representative, who asked not to be named. "All that data is completely separate from customer information. TiVo doesn't need to know who you are to record 'Friends.' This doesn't change that equation."

In the past, TiVo has been sensitive to data privacy issues and has developed its system to keep the data separate. That has helped the company to easily offer the new service, the representative said.

"Tivo doesn't need to do anything different, so it can be done at a very low cost," the representative said.

The new audience-measurement service comes a month after TiVo announced a new basic service that consumer-electronics makers can build into devices--such as DVD players--that combine video recording with other functions.

CNET News.com's Stefanie Olsen contributed to this report.

 

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