BDUs downplay TiVo-EchoStar battle

The battle of the boxes between TiVo Inc. and EchoStar Communications Corp. rages on south of the border, but Canadian BDUs say they aren’t worried that Alviso CA-based TiVo will look for new targets here. "As a downstream consumer of the product, we don’t really have that level of detailed knowledge about what’s going on with respect to the intellectual property and patents," says Mike Lee, chief strategy officer at Rogers Communications Inc. " when you cut your with your suppliers, you end up with…some level of indemnity." On Aug. 17, Judge David Folsom of the US District Court’s Eastern Texas Division ordered Englewood CO’s EchoStar to disable the digital video recorder (DVR) features of more than three million of its set-top boxes currently in subscribers’ homes. However, that order was temporarily blocked the following day by the US Circuit Court of Appeals. Judge Folsom’s decision stems from an April ruling in the same court in which a jury found that EchoStar’s hardware infringed a patent for a specific TiVo feature, dubbed "time warping," which allows users to digitally record programming on one channel while watching another. As a result of that earlier decision, EchoStar was ordered to pay US$74 million to TiVo, a figure that was increased to US$89.6 million by Judge Folsom last week. Rogers’ cable division offers several boxes with DVR functionality: the 8300 series from Cisco Systems Inc.’s Scientific Atlanta division, which comes in both standard definition (SD) and high definition (HD) television versions, and Motorola Inc.’s DCT 6208 HD DVR-decoder, offered through its New Brunswick and Newfoundland and Labrador cablesystems. Other BDUs also offer similar equipment: DTH provider Bell ExpressVu offers both SD and HD receivers with DVR features, while rival Star Choice Communications Inc. offers the Motorola DVR530 HD DVR-decoder unit. Both were contacted for this story: Bell ExpressVu would only say that it’s aware of the TiVo-EchoStar litigation, but that it has no effect on its Canadian customers. Star Choice representatives couldn’t be reached before press time. While the patent for TiVo’s time warping feature may sound like it would cover a lot of basic DVR functionality, Rogers’ Lee says the specific details of how the technology would be implemented are what’s at issue – and what TiVo is seeking to protect. "Very rarely do you see a situation where there’s a foundation patent that covers an entire category of product and the fundamental way it works," he says. Lee notes that other DVR makers hold patents of their own that allow for digital recording of TV signals. "My understanding of the DVR space is that the patent portfolio is spread amongst many players." For instance, Cupertino CA’s ReplayTV – founded in 1997 – was one of the earliest DVR companies and currently holds patents for a range of video playback technologies. Scientific Atlanta holds more than 650 patents, not all relating to DVR technology. And, more entrants into the DVR research and manufacturing business are cropping up all the time. "I think the one thing that leads you to the conclusion that there’s probably a wide distribution of patents in this space is that there’s a lot of startups who are looking at this functionality," Lee says. "Generally, if there’s a strong patent position in the industry you get almost a freezing of innovation, and you’re not seeing that right now." Newer offerings such as Kirkland WA-based Digeo Inc.’s Moxi and a networked DVR from Toronto’s Akimbo Systems are two such examples. Indeed, some industry watchers speculate that TiVo might have infringed some of ReplayTV’s patents itself, a reversal of circumstances that Lee says TiVo would do well to be wary of. "Making an effort and spending legal time on this only to find out that you’re in violation yourself of someone else’s patent is a complete waste of time," he says.

BDUs downplay TiVo-EchoStar battle

Broadcast | August 29, 2006

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