Last month rumors began to burble up that Rovi was looking to acquire TiVo. The idea of the deal certainly made sense from a business perspective, but after a few days, the rumors began to settle down. In the meantime, TiVo announced a new model in its Roamio OTA DVR line.
Those rumors turned out to be true, as Rovi announced it does indeed intend to acquire the DVR king in a $1.1 billion deal. $288 million in cash will change hands as part of the deal, with the rest paid in shares of the new company.
“The combined capabilities of TiVo and Rovi place us in a tremendous position to extend services across platforms and to a customer base that includes traditional, over-the-top and emerging players across the globe,” Rovi CEO Tom Carson said. “By working together, Rovi and TiVo will revolutionize how consumers experience media and entertainment and at the same time build value for our stockholders.”
While it is Rovi making the purchase here, the new company might have some thinking it was the other way around. The name of the new company will be TiVo, which makes sense from a brand recognition standpoint — most people have a least a notion of what TiVo is, while Rovi is hardly a household name.
Rovi was initially known as MacroVision, a name that might be at least somewhat more recognizable, at least to anyone old enough to have ever used a VCR. The company originally focused on video DRM (Digital Rights Management), but eventually shifted to on-screen TV listings and metadata-based search. Between Rovi and TiVo, the new company now holds more than 6,000 patents, capable of providing it with plenty of revenue, without even accounting for TiVo’s DVR business.
The deal is subject to the standard regulatory approvals, but assuming there are no snags, Rovi expects the deal to close by the third quarter of this year.