Digitalsmiths will generate “double-digit” revenue increases for the...
Digitalsmiths will generate “double-digit” revenue increases for the “next several years” as TiVo moves to boost its cloud-based DVR strategy, TiVo CEO Tom Rogers said on an earnings call. TiVo’s $135 million acquisition of video monetization company Digitalsmiths potentially gives…
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access to some tier-one pay-TV operators that had eluded it, including Dish Network and Time Warner Cable. Time Warner Cable agreed to build Digitalsmiths’ Seamless Discovery video recommendations engine into its user interface, allowing viewers to find and view content across TVs, smartphones, tablets and PCs. The purchase is expected to enable TiVo to move core set-top DVR features like search and recommendation to the cloud. Digitalsmiths’ customers also reach 64 percent of U.S. pay-TV homes and it has agreements with seven of the Top 10 operators, Rogers said. Analysts said the purchase also will likely deepen TiVo’s ties with Comcast, which has proposed buying Time Warner Cable. The Digitalsmiths acquisition will “allow us to offer our products and services both to operators who want our user interface as well as those who are looking to build their own user interfaces but need strong content and discovery service powering it,” Rogers said. The increase in Digitalsmiths-related revenue will be driven by “increased penetration” with its existing customers and new ones, he said. Digitalsmiths will be “adjusted EBITDA positive” in fiscal 2015, Rogers said. TiVo forecast deployment of Digitalsmiths software to grow to 50 percent of pay-TV subscribers from 10 percent in “the next few years” as its customers move from a second screen application to the set-top platform, TiVo Chief Financial Officer Naveen Chopra said. “You can imagine an operator is deploying an advanced solution with the full TiVo experience, maybe integrating Digitalsmiths into some of their legacy platforms and using digital transport adapters for analog to digital transition,” Chopra said.