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TiVo Q4 Sales Flat, Intros New Prices, Verizon Deal

3/09/2006 08:16:00 AM Eastern

Alviso, Calif. — While TiVo reported flat revenue for its fiscal fourth quarter and a reduced loss, the DVR company unveiled a simplified pricing plan and provided details on a TiVo Mobile service with Verizon Wireless.

TiVo’s revenue for its fiscal fourth quarter, come in at $60.1 million, compared with a year-ago $59.4 million. Net loss in the fourth quarter, ended Jan. 31, dropped to $19.5 million, a 42 percent improvement over the $33.7 million net loss racked up in the same three months the previous year.

Service and technology revenue in the quarter rose 37 percent, hitting $47 million, up from $34.2 million in the same quarter the prior year.

Total subscriptions at the end of the fourth quarter reached 4.4 million, a 45 percent rise in the subscription base over the 3 million on hand 12 months earlier. The company acquired 356,000 new subscribers in the three months, compared with 698,000 in the same quarter last year.

TiVo-owned subscription gross additions were 221,000 for the quarter, down from 276,000 year-on-year, with the decline reflective of a more challenging competitive environment, said the company. TiVo added 173,000 DirecTV subscriptions in the three months, compared with 447,000 in the same quarter last year.

For the 12 months, TiVo net revenue climbed to $195.9 million, from $172.1 million the previous year. Service and technology revenue for the year jumped 48 percent, reaching $170.9 million, up from a year-ago $115.5 million.

Net loss for the 12 months was $34.4 million, a 57 percent improvement over the $79.8 million net loss rung up a year earlier.

TiVo-owned subscription gross additions for the year decreased to 494,000, from a year-earlier 555,000. The company added 1 million DirecTV subscriptions in the 12 months, down from 1.2 million a year ago. TiVo acquired 1.4 million subscribers in the 12 months, compared with 1.7 million year-on-year.

Looking to boost its subscriber base, TiVo is offering consumers new simplified pricing plans that allow customers to bundle purchase of their TiVo digital video recorder and service at all-in-one prices. The one- to three-year commitment includes no separate charges for TiVo boxes and TiVo services.

Under its new pricing plan, TiVo expects to generate new subscriptions, reduce customer churn and increase net gain per sub.

TiVo subscribers will save about $50 on a new DVR, after rebates. The refreshed deal costs $19.95 monthly for a TiVo box and 1-year of service, or $224 prepaid; the two-year commitment for box and service is $18.95 per month, or $369 prepaid; and three years is $16.95 and $469.

Initially, the plan is available to subscribers who go through TiVo.com. Subscribers who sign up in retail stores will incur current prices and service fees, but the company said it is working to offer the same new pricing plan at retail. Current monthly service fee is $13, and the company said it is eliminating the lifetime service subscription fee of $299.

In other TiVo news, the company signed a deal with Verizon Wireless to enable owners of stand-alone TiVo Series2 DVRs to schedule programs to be recorded from anywhere in the country using their Verizon mobile phones.

The new service, called TiVo Mobile, will be offered by Verizon Wireless of New York. As part of the deal, the wireless carrier has a 60-day exclusive on the capability before TiVo can offer it to other wireless carriers.

The feature will require TiVo subscribers to download a software program to their Verizon Wireless phones. The software will enable the phones to communicate with the TiVo recorder networked to a PC in the home.

The capability is similar to a feature currently offered by TiVo enabling Series 2 owners to schedule recordings remotely over the Internet using a PC or laptop.

Verizon Wireless will begin offering the service to its customers this summer for less than $5 a month, in addition to normal mobile phone service charges and TiVo subscriber fees, which are $12.95 a month. — Additional reporting by Greg Tarr