TiVo and Cox Communications reach video-on-demand deal

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TiVo Inc. has struck a deal with Cox Communications to integrate the cable company’s video-on-demand service into TiVo’s digital video recorders.

For consumers, the deal lets viewers take advantage of both TiVo and Cox on-demand services without having to juggle two devices. Before this deal, most consumers needed a cable set-top box to get on-demand programs and a TiVo for any number of Internet services such as streaming movies from Netflix Inc., Rhapsody Inc.’s music streaming and Inc.’s Video on Demand.

Though TiVo pioneered the technology for automatically recording TV programs, it has struggled over the years to sell its devices as cable companies offer similar features in their set-top boxes. With consumers reluctant to have too many gadgets cluttering their living rooms, cable companies have generally come out ahead.

As a result, the Alviso, Calif., company has focused on collaborating with cable and satellite companies. The deal with Cox is a significant win for TiVo because it gives the company the ability to offer viewers living in areas served by Cox a single-device option for on-demand cable and Web-based services provided by TiVo.

“This is the first time that a cable operator will be making their on-demand product available to a retail device,” said Jeff Klugman, TiVo’s senior vice president and general manager of product and revenue.

The deal is primarily aimed at attracting new customers for both companies, since existing subscribers are less likely to switch out their devices. Cox operates in 18 states and has 6 million subscribers, including 1 million in San Diego, Orange County, Palos Verdes and Santa Barbara. TiVo has 2.5 million subscribers.

“We can anticipate that will gain us more customers,” said Steve Necessary, vice president of video strategy and product management for Atlanta, Ga.-based Cox. “It’s obviously challenging to quantify that. Time will tell. I’m sure it will be a positive number. I just don’t know how big.”