DISH Buying TIVO?

[DishSubLA]

So why would dish buy Tivo and have to defend all those lawsuits ?

Charlie wouldn't defend. He would would come to an agreement to drop his (should he buy TiVo) suits if the others dropped their counterclaims. Done all the time. I don't think Ergan sees any advantage in continuing suits that the former owners of TiVo filed. Most likely Charlie would just drop them all for them dropping counter-suites and move on. The point of buying TiVo would be to eliminate Dish having to pay big $$$ in licensing fees to another company that would have total leverage when it comes time to negotiate new, higher fees down the road. Cheaper in the long run to buy as a friendly take-over. The sticking point would be price.

 

[meStevo]

Charlie wouldn't defend. He would would come to an agreement to drop his (should he buy TiVo) suits if the others dropped their counterclaims. Done all the time. I don't think Ergan sees any advantage in continuing suits that the former owners of TiVo filed. Most likely Charlie would just drop them all for them dropping counter-suites and move on. The point of buying TiVo would be to eliminate Dish having to pay big $$$ in licensing fees to another company that would have total leverage when it comes time to negotiate new, higher fees down the road. Cheaper in the long run to buy as a friendly take-over. The sticking point would be price.

Eh, it's not that simple, there are a lot of costs involved in litigation whether it's seen through to the end or not. It will take a lot more than 'lets just leave our costs as-is and go home eh?' from a new owner to resolve existing lawsuits.

There's also an issue with not defending your intellectual property, talk about throwing money down the drain. The only reason TiVo is worth anything at all is it's intellectual property. If other companies are genuinely infringing on patents (like Dish was) then knowingly allowing them to infringe becomes a defense for others who also decide to. As part of settling existing suits licensing agreements would need to be worked out to preserve that intellectual property in addition to settling the suits.

 

[whatchel1]

Sky Report

From Sky Report today. When are they gonna get some people that really have some info on this subject. How long will it take Charlie to switch to the VIP's before he pays them a cent? Then let's see how long it takes the stock to tank for a chance at an easier buy out.

Bets on TiVo v. DISH

As expected DISH has filed for an 'en banc' review of the recent judicial ruling in favor of TiVo. Few observers believe that Appellate judges will grant a full review ... meaning that DISH will likely have to negotiate its way out of the mess, probably for a hefty ($4/sub/month is often mentioned) licensing fee.

Indeed, analyst Tony Wible with Janney Montgomery Scott recently upped his fair value on TiVo stock, noting that the DVR company could receive $400 million from a DISH settlement. Wible now pegs TiVo shares at $26, up from an earlier $22 valuation.•

 

[riffjim4069]

So far there has been no credible evidence supporting DISH buying TIVO since the Board of Directors would have to notify shareholders of the offer. While this may eventually happen, it's clear the initial rumor was incorrect.

DISH is not buying TIVO.

 

[Curtis0620]

From Sky Report today. When are they gonna get some people that really have some info on this subject. How long will it take Charlie to switch to the VIP's before he pays them a cent? Then let's see how long it takes the stock to tank for a chance at an easier buy out.

Bets on TiVo v. DISH

As expected DISH has filed for an 'en banc' review of the recent judicial ruling in favor of TiVo. Few observers believe that Appellate judges will grant a full review ... meaning that DISH will likely have to negotiate its way out of the mess, probably for a hefty ($4/sub/month is often mentioned) licensing fee.

Indeed, analyst Tony Wible with Janney Montgomery Scott recently upped his fair value on TiVo stock, noting that the DVR company could receive $400 million from a DISH settlement. Wible now pegs TiVo shares at $26, up from an earlier $22 valuation.•

All DVRs will be affected.

 

[navychop]

In your opinion. An opinion that is not widely shared.

One word regarding some earlier posts: Cross-licensing.

 

[Kheldar]

In your opinion. An opinion that is not widely shared.

One word regarding some earlier posts: Cross-licensing.

All of DishNetwork's government filings seem to agree with Curtis0620's opinion. No one that has the opposite opinion has been able to provide any court documents or government filings that suggest the ViP series is immune from this case.

Can anyone provide any proof that the VIPs are not included in this lawsuit? There is a lot of speculation, but no documented proof that I have seen that excludes the VIP series.

DishNetwork is talking about the lawsuit in their 2009Q4 quarterly report that doesn't differentiate between the VIP and other DVRs. From page 18 (blue text is my emphasis):

If we are unsuccessful in overturning the District Court’s ruling on Tivo’s motion for contempt, we are not successful in developing and deploying potential new alternative technology and we are unable to reach a license agreement with Tivo on reasonable terms, we would be subject to substantial liability and would be prohibited from offering DVR functionality that would result in a significant loss of subscribers and place us at a significant disadvantage to our competitors.

In June 2009, the United States District Court granted Tivo’s motion for contempt finding that our next-generation DVRs continue to infringe Tivo’s intellectual property and awarded Tivo an additional $103 million dollars in supplemental damages and interest for the period from September 2006 through April 2008. In September 2009, the District Court partially granted Tivo’s motion for contempt sanctions. In partially granting Tivo’s motion for contempt sanctions, the District Court awarded $2.25 per DVR subscriber per month for the period from April 2008 to July 2009 (as compared to the award for supplemental damages for the prior period from September 2006 to April 2008, which was based on an assumed $1.25 per DVR subscriber per month). By the District Court’s estimation, the total award for the period from April 2008 to July 2009 is approximately $200 million (the enforcement of the award has been stayed by the District Court pending DISH Network’s appeal of the underlying June 2009 contempt order). As previously disclosed, we increased our reserve for the Tivo litigation to reflect both the supplemental damages award for the period September 2006 to April 2008 and for the estimated cost of alleged software infringement for the period from April 2008 through June 2009.

If we are unsuccessful in overturning the District Court’s ruling on Tivo’s motion for contempt, we are not successful in developing and deploying potential new alternative technology and we are unable to reach a license agreement with Tivo on reasonable terms, we would be required to eliminate DVR functionality in all but approximately 192,000 digital set-top boxes in the field and cease distribution of digital set-top boxes with DVR functionality.

The 192,000 DVRs were the "first generation" DVRs, which DishNet has already had to pay TiVo licensing fees for, and most of which are dead now, I think. Those units are OK.

This paragraph says "we would be required to eliminate DVR functionality in all but approximately 192,000 digital set-top boxes in the field and cease distribution of digital set-top boxes with DVR functionality."

This does not make any wiggle room for excluding the VIP series. Even if we believe some previous posters that state that this sentence is the "worst case scenario", then they would have phrased it something like this (italicized areas are my changes): "If we are unsuccessful in overturning the District Court’s ruling on Tivo’s motion for contempt, we are not successful in developing and deploying potential new alternative technology, we are not successful in replacing all allegedly infringing DVRs with non-infringing VIP-series DVRs, and we are unable to reach a license agreement with Tivo on reasonable terms, we would be required to eliminate DVR functionality in all but approximately 192,000 non-VIP digital set-top boxes in the field and cease distribution of digital set-top boxes with DVR functionality."

The doom and gloom continues:

... In that event we would be at a significant disadvantage to our competitors who could continue offering DVR functionality, which would likely result in a significant decrease in new subscriber additions as well as a substantial loss of current subscribers. Furthermore, the inability to offer DVR functionality could cause certain of our distribution channels to terminate or significantly decrease their marketing of DISH Network services. The adverse effect on our financial position and results of operations if the District Court’s contempt order is upheld is likely to be significant. Additionally, the awards described above do not include damages, contempt sanctions or interest for the period after June 2009. In the event that we are unsuccessful in our appeal, we could also have to pay substantial additional damages, contempt sanctions and interest. Depending on the amount of any additional damage or sanction award or any monetary settlement, we may be required to raise additional capital at a time and in circumstances in which we would normally not raise capital. Therefore, any capital we raise may be on terms that are unfavorable to us, which might adversely affect our financial position and results of operations and might also impair our ability to raise capital on acceptable terms in the future to fund our own operations and initiatives. We believe the cost of such capital and its terms and conditions may be substantially less attractive than our previous financings.

If we are successful in overturning the District Court’s ruling on Tivo’s motion for contempt, but unsuccessful in defending against any subsequent claim in a new action that our original alternative technology or any potential new alternative technology infringes Tivo’s patent, we could be prohibited from distributing DVRs or could be required to modify or eliminate our then-current DVR functionality in some or all set-top boxes in the field. In that event we would be at a significant disadvantage to our competitors who could continue offering DVR functionality and the adverse effect on our business could be material. We could also have to pay substantial additional damages.

Because both we and EchoStar are defendants in the Tivo lawsuit, we and EchoStar are jointly and severally liable to Tivo for any final damages and sanctions that may be awarded by the District Court. We have determined that we are obligated under the agreements entered into in connection with the Spin-off to indemnify EchoStar for substantially all liability arising from this lawsuit. EchoStar has agreed with us to contribute an amount equal to its $5 million intellectual property liability limit under the Receiver Agreement. We and EchoStar have further agreed that EchoStar’s $5 million contribution would not exhaust EchoStar’s liability to us for other intellectual property claims that may arise under the Receiver Agreement. We and EchoStar also agreed that we would each be entitled to joint ownership of, and a cross-license to use, any intellectual property developed in connection with any potential new alternative technology.

If DishNet's lawyers are not excluding the VIP series from the doom-and-gloom scenario, then chances are that they will be affected. Really, if they knew the VIP series wasn't included, they would announce that fact to the world as loudly as possible. Granted this is the 2009Q4 report, but if anything has changed since then, surely DishNet would brag about it to everyone that will listen.

 

[riffjim4069]

I agree with Kheldar...although the ViP Series DVRs were not mentioned in the original lawsuit, they are subject to the plain language of the contempt order if they, at the time of the order (and not after DISH later modified the ViP series code), were only colorably different then those models already adjudged (and upheld on appeal) to infringe. That's why industry analysts, like Craig Moffett, have repeatedly mentioned that DISH would be required to disable DVR functionallity in millions of DVRs s should they lose their motion appealing the contempt order, which was already upheld by the appeallate court...will most likely not be heard en banc...and stands a snowball's chance in hell of being heard by the Supreme Court since they are busy dealing with real constitutional issues like 18-states moving to overturn Federal Healthcare.

Two things I feel are certain:

- The court (i.e., Judge Folsom) has the authority to include the ViP Series DVRs as part of the contempt order
- Judge Folsom will not entertain any "software workaround" nonsense until DISH complies with the original contempt order (disable DVR functionality is all infringing DVRs, at the time of the order, to include those only colorably different)

Does this mean the ViP DVRs are only colorably different and will be disabled? No! But it will be Judge Folsom who makes this determination...and I wouldn't bet against it happening. Needless to say, it appears that DISH will soon be paying $3-$4 in licensing fees per month for each and every DVR in their inventory - to include the VIP Series and the infringing 922 (which also infringes on Tivo's recently patented (10-years in the making) Season Pass Manager). Other than buying TIVO at an inflated price, DISH really has no other choice in this matter (if this is even possible at this late hour). Folks can certainly disagree with me (I'm no lawyer nor have I recently slept at a Holiday Inn), but this is the way I see the events unfolding.

DISH's only hopes:

- the Federal Appeallate court en banc decides to rehear this case (not likely) and overturns the contempt order (highly unlikely)
- the Supreme Court decides to hear this case (highly doubtful) and overturns the contempt order (highly improbably)

Again, this should have been a non-issue as DISH should have licensed Tivo's IP a year or two ago for a fraction of what it's now going to cost them. I don't have a horse in this race, but I don't see how anyone from the DISH camp can feel "confident" about this case after having been raked-over-the-coals since 2006. Eternal optimists, I suppose.

 

[Voyager6]

One of the main points that Judge Rader made in his dissent of the contempt appeal was Judge Folsom insisting that all the infringing DVR's be disabled EVEN IF THEY NO LONGER INFRINGE. This is an impossible condition for E*. E* will be forced to disable all of it's DVR's (including the VIP series if Folsom so deems it) forever. The Courts have allowed infringers to try and create work arounds. However, in this case, Folsom seems to have disallowed any work arounds and has failed to consider the new work arounds that E* has submitted to the Court. Judge Rader seemed perplexed by this ruling. He just needs to persuade several other Judges to examine this ruling by Folsom. This contempt ruling really needs to be heard by the full Court.

 

[whatchel1]

Betting on that EchoStar/TiVo Merger

At least one analyst is putting his chips on a DISH/TiVo merger following the disastrous (for DISH) ruling in the U.S. Court of Appeals. Says Citi analyst Jason Bazinet, the most likely outcome is a EchoStar/TiVo merger thanks to "synergies between Sling and TiVo; 2Q09 EchoStar indemnification from TiVo liabilities; and De-risking of DISH’s business on the heels of a TiVo win. That, Bazinet says, would be good for DISH shares, bad for EchoStar. (from Sky Report)

 

[Dah-Henny]

At least one analyst is putting his chips on a DISH/TiVo merger following the disastrous (for DISH) ruling in the U.S. Court of Appeals. Says Citi analyst Jason Bazinet, the most likely outcome is a EchoStar/TiVo merger thanks to "synergies between Sling and TiVo; 2Q09 EchoStar indemnification from TiVo liabilities; and De-risking of DISH’s business on the heels of a TiVo win. That, Bazinet says, would be good for DISH shares, bad for EchoStar. (from Sky Report)

Here's the very interesting pdf that accompanies whatchel's post:
View attachment SNA53493.pdf

 

[dlsnyder]

I wonder if that's what the recent DVR rate increase was for - to build up Dish's war chest in defense against Tivo.

 

[Tyralak]

I wish Echostar would just buy tivo and get it over with. I'm really sick of all this.

 

[whatchel1]

Then don't look

I wish Echostar would just buy tivo and get it over with. I'm really sick of all this.

You don't have to come read the thread.

 

[Tyralak]

You don't have to come read the thread.

That isn't the point I was making. I'm tired of the extortion by tivo, not the discussion of it.

 

[whatchel1]

KEWL

That isn't the point I was making. I'm tired of the extortion by tivo, not the discussion of it.

I agree w/ U on that one.

 

[riffjim4069]

That isn't the point I was making. I'm tired of the extortion by tivo, not the discussion of it.

I don't disagree as I have never been a fan of Tivo's patents...unfortunately, the law has repeatedly sided with Tivo on this issue so perhaps it's more accurate to frame Tivo's actions as "legal extortion" in the eyes of the courts. Let's face facts, Charlie took a big risk not settling with Tivo years ago and, barring any last-minue heroics on the part of Dish's legal team (highly unlikely), he is about to lose. As numerious Wall Street pundits have opined, “Dish is now negotiating with a gun to its head”. Regardless, Dish will now pay a premium to license Tivo IP for each and every DVR in their inventory ~or~ purchase Tivo at a super-inflated price ~or~ risk having upwards of 8 million DVRs disabled. It's also unfortunately that Dish shareholders will have to suffer due to one individuals stubbornness and potentially negligent behavior. Finally, it is not fair to criticize Tivo without including the USPTO, intellectual property law, and the Federal Court system. Just my two-cents from the cheap-seats.

 

[pabeader]

there are probably only 100,000 infringing DVRs out there, so it really isn't that big of a deal.

 

[Thomas22]

there are probably only 100,000 infringing DVRs out there, so it really isn't that big of a deal.

Charles Ergen under oath, 02-09:

Q IS THE FOLLOWING AN ACCURATE STATEMENT, THAT ECHOSTAR
WOULD LOSE 90 MILLION PER MONTH IF IT HAD TO COMPLY FULLY WITH
THE TERMS OF THE INJUNCTION, ASSUMING IT’S PROPERLY
INTERPRETED AS REQUIRING YOU TO DISABLE THE DVR FUNCTIONALITY
IN THE SPECIFIED PRODUCT LINES?
A THERE WOULD HAVE BEEN A TIME FRAME THAT THAT WOULD HAVE
BEEN AN ACCURATE STATEMENT. TODAY THAT –-
Q NINETY –-
A –- TODAY IT WOULD BE MORE THAN THAT. TODAY WOULD BE MORE
THAN $90 MILLION DOLLARS.
Q AND HOW MUCH WOULD IT BE A MONTH TODAY?
A WOULD BE PROBABLY SEVERAL HUNDRED –- IT WOULD BE OVER
SEVERAL HUNDRED MILLION DOLLARS. I DON’T KNOW EXACTLY. I
DON’T HAVE THE FIGURES IN FRONT OF ME, BUT IT WOULD BE MORE
TODAY.
Q SEVERAL HUNDRED MILLION DOLLARS A MONTH?
A IT MAY BE AS MUCH AS SEVERAL HUNDRED MILLION DOLLARS A
MONTH.
Q TWO TO THREE HUNDRED MILLION DOLLARS A MONTH?
A WELL, I DON’T HAVE FIGURES IN FRONT OF ME –-
Q BUT JUST GENERALLY.
A –- BUT IT WOULD BE MORE –- IT WOULD BE –- SUFFICE IT TO
SAY IT WOULD BE MORE THAN $90 MILLION TODAY BECAUSE WE HAVE
MORE DVRS TODAY AND OUR CUSTOMERS PAY US MORE TODAY.
​

 

[whatchel1]

So what

Charles Ergen under oath, 02-09:

Q IS THE FOLLOWING AN ACCURATE STATEMENT, THAT ECHOSTAR
WOULD LOSE 90 MILLION PER MONTH IF IT HAD TO COMPLY FULLY WITH
THE TERMS OF THE INJUNCTION, ASSUMING IT’S PROPERLY
INTERPRETED AS REQUIRING YOU TO DISABLE THE DVR FUNCTIONALITY
IN THE SPECIFIED PRODUCT LINES?
A THERE WOULD HAVE BEEN A TIME FRAME THAT THAT WOULD HAVE
BEEN AN ACCURATE STATEMENT. TODAY THAT –-
Q NINETY –-
A –- TODAY IT WOULD BE MORE THAN THAT. TODAY WOULD BE MORE
THAN $90 MILLION DOLLARS.
Q AND HOW MUCH WOULD IT BE A MONTH TODAY?
A WOULD BE PROBABLY SEVERAL HUNDRED –- IT WOULD BE OVER
SEVERAL HUNDRED MILLION DOLLARS. I DON’T KNOW EXACTLY. I
DON’T HAVE THE FIGURES IN FRONT OF ME, BUT IT WOULD BE MORE
TODAY.
Q SEVERAL HUNDRED MILLION DOLLARS A MONTH?
A IT MAY BE AS MUCH AS SEVERAL HUNDRED MILLION DOLLARS A
MONTH.
Q TWO TO THREE HUNDRED MILLION DOLLARS A MONTH?
A WELL, I DON’T HAVE FIGURES IN FRONT OF ME –-
Q BUT JUST GENERALLY.
A –- BUT IT WOULD BE MORE –- IT WOULD BE –- SUFFICE IT TO
SAY IT WOULD BE MORE THAN $90 MILLION TODAY BECAUSE WE HAVE
MORE DVRS TODAY AND OUR CUSTOMERS PAY US MORE TODAY.
​

You seem to like to quote something he said in court. But he is no t the one that knows which one's that will be those that have to be turned off. He was just stating off the top of his head what the worst could be. So Tivo fan boy getting tired of your line of BS. This may not be the fact & would have to be proved that ALL DVR's would be shut off instead of just the one's listed in the original suit.