Deal could allow Comcast to use TiVo's software on DVRs

Exact terms, including prices, could not be determined. Comcast, which has a potential market of 22 million subscribers for TiVo service, declined to comment. TiVo didn't return calls.The deal, if done, would be strategically important for TiVo, which had about 3 million subscriptions at the end of January. Its stock has fallen about 60% in the past year, closing Monday at $3.83, as investors questioned its growth prospects.About 62% of its subscriptions are from a service arrangement with DirecTV to run DVR-equipped satellite receivers. But the satellite broadcaster, now run by News Corp., is preparing to introduce an in-house DVR service as an alternative to TiVo. EchoStar also provides its own DVR service to subscribers. Meanwhile, cable operators, with 73.6 million basic subscribers, have begun offering digital cable boxes equipped with DVRs to keep customers from switching to satellite.DVRs make it easy for viewers to record TV shows on a hard drive and give them the flexibility to speed through ads and pause live programs.Many feared that TiVo's service, which costs about $13 a month, or $300 for the life of the DVR, would be eclipsed by lower-priced cable and satellite-provided DVRs that are built into cable and satellite boxes.TiVo has struggled to cut a deal to jump on the cable bandwagon. After years of inconclusive talks, TiVo recently told investors that it was prepared to go it alone, offering TiVo as a premium service with features others couldn't match. The failure to cut a breakthrough deal contributed to major TiVo changes recently. TiVo President Marty Yudkovitz resigned, and CEO Michael Ramsay said he would relinquish that job — but remain chairman — after the board picks a successor. Last week, TiVo reported a net loss of $33.7 million on revenue of $59.4 million for the quarter that ended Jan. 31.But Ramsay has promised shareholders that TiVo would be profitable this year.As for Comcast, a deal with TiVo could make it easier to sell digital cable services — one of its top priorities. Comcast collects an additional $10 a month or so for digital. In addition, it enables customers to view Comcast's video-on-demand offerings.Last week, Comcast struck a deal with Motorola to buy $1 billion worth of set-top decoders equipped with state-of-the-art technology, including DVRs. That was the largest such order ever for Comcast.Separately, Ramsay reported in a Securities and Exchange Commission filing that he was awarded 250,000 TiVo option grants Friday for $3.78 a share.