DISH Network and EchoStar Statement Regarding Tivo

[mike123abc]

TiVo fell 9.27% today. The WSJ's tech podcast has a section on TiVo:

http://podcast.mktw.net/wsj/audio/20080602/pod-wsjtecham/pod-wsjtecham.mp3?mod=wsjcrmain

Dish vs. TiVo section starts at 1:15

 

[Hall]

Their poison pill terms has this section,

They do not prevent a takeover, but
should encourage anyone seeking to acquire the Company to negotiate with the
Board of Directors prior to attempting a takeover.

The point of this poison pill was to prevent someone from buying out the company before they became "big". Look at TiVo's historical stock price listing:

TIVO: Historical Prices for TIVO INC - Yahoo! Finance

They're not exactly a booming business. Prior to 2000, yeah, but not now.... I've said it before and I'll repeat it again: If Charlie approached TiVo's board to buy the company at a reasonable price, you'll hear one word: SOLD !!

 

[rad]

From Analyst: Dish Risks Mount - 6/3/2008 4:11:00 PM - Multichannel News

"Shares of Dish Network shed 91 cents, or 3%, to close at $34.37 Tuesday after Sanford Bernstein cable and satellite analyst Craig Moffett issued a report warning that litigation risks stemming from its ongoing patent fight with TiVo could translate into huge costs and larger than expected subscriber losses for the No. 2 satellite TV company.
.
.
.

But Moffett warned that recent developments—on May 16 TiVo asked a Texas court to find Dish in contempt for not disabling its DVR functionality as previously ordered—could be the knockout blow for Dish.

“If Dish loses a current round of contempt litigation related to their alleged ‘work around,’ then the costs to Dish of disabling DVRs, settling with TiVo, or—worst of all—potentially engaging in a bidding war for the right to continue offering DVRs at all, could be in a worst case scenario in the billions… far higher than currently contemplated,” Moffett wrote. “Even the option of settling the case for just $1 per month per subscriber may well have passed.”

A hearing on the contempt matter is scheduled for Sept. 4."

 

[mike123abc]

From Analyst: Dish Risks Mount - 6/3/2008 4:11:00 PM - Multichannel News

"Shares of Dish Network shed 91 cents, or 3%, to close at $34.37 Tuesday after Sanford Bernstein cable and satellite analyst Craig Moffett issued a report warning that litigation risks stemming from its ongoing patent fight with TiVo could translate into huge costs and larger than expected subscriber losses for the No. 2 satellite TV company.
.
.
.

But Moffett warned that recent developments—on May 16 TiVo asked a Texas court to find Dish in contempt for not disabling its DVR functionality as previously ordered—could be the knockout blow for Dish.

“If Dish loses a current round of contempt litigation related to their alleged ‘work around,’ then the costs to Dish of disabling DVRs, settling with TiVo, or—worst of all—potentially engaging in a bidding war for the right to continue offering DVRs at all, could be in a worst case scenario in the billions… far higher than currently contemplated,” Moffett wrote. “Even the option of settling the case for just $1 per month per subscriber may well have passed.”

A hearing on the contempt matter is scheduled for Sept. 4."

It is a very serious risk Dish is taking not settling with TiVo and licensing the software. I do not understand why they did not settle, after all they charge a hefty DVR fee for every DVR. The DVR fee from Dish is nothing more than a profit fee, they could at least use some of it for licensing the TiVo software.

It is serious enough that when people ask me for a recomendation I say to hold off, stay with cable or think seriously about DIRECTV.

 

[RVD420]

It would be interesting to see if Dish could buy 14.99%, Echostar 14.99%, and others each buy 14.99%

Good idea there.

Have Dish buy 14.99%, Echostar buy 14.99%, Charlie E. buys 14.99% and Jimmy D buys 14.99%.

That would encure Charlie would have his way....and avoid a Poison Pill.

 

[Hall]

The poison pill provisions kick in if a person "or group" acquires 15% or more. I don't know if it's automatic or not, but if it's "manual", they can, and will, certainly consider those people a "group" and turn it on.

 

[harshness]

So Tivo wins lawsuit Direct TV sues Tivo--Tivo lose Tivo is now part of Direct Tv -- so it goes on and on

Part of DIRECTV's current agreement with TiVo is a clause that they can't sue each other.