TiVo Plays Christmas Grinch To TiVoDownUnder

December 28th, 2006 Davis Posted in DRM, Disclosure - I own stock in co. mentioned, TiVo |

Every Who
Down Under
Liked TiVo a lot…

The TIVO hated Down-Under!
The whole TV season!
Now, please don’t ask why. No one quite knows the reason.
It could be that his antenna wasn’t screwed on quite right.
It could be, perhaps, that his tie was too tight.
But I think that the most likely reason of all
May have been that TiVo’s stock price was two sizes too small.

The holidays are always a special time of the year. There are the decorations, the parties, plenty of food, and of course great stimulating conversations. But while most of us were busy fighting crowded malls and sugar overdoses, TiVo’s legal department got into the holiday spirit by playing the Grinch to TiVoDownUnder.com

In the US, if you want to offer an electronic program guide (EPG) then you better be prepared to take on TVGuide. TVGuide claims that they own all patent rights to the EPG in the US, and their strategy has been to sue anything that records into submission. So far they’ve been pretty successful with this strategy and over 50% of all set top boxes in the US, now pay some kind of tribute to TVGuide.

TVGuide’s broad interpretation of their patents has raised charges of anti-trust behavior in the past, but in Australia, technology companies face a much worse situation. Not only does Nine Networks claim to own the copyright on EPGs for Australian TV, but instead of trying to license this information like TVGuide does, they’ve instead choosen to restrict it’s use in a futile attempt to try and squash DVR usuage. Because Nine Networks also sells TV advertising, they’ve been in no hurry to usher in the DVR age for citizens living down under.

To get around this technological roadblock, creative Australians started importing TiVo units into the country and have created a community where they use unwieldy tools to scrape the internet for TV listings. One company, Ice TV, actually tried to build a business around selling EPG data, but as soon as they filed to take their company public, Nine Networks scuttled their plans by filing a lawsuit against them that will likely establish the precident as to whether or not time shifting will be allowed to move forward in Australia.

Finding the resources to support a bootleg EPG industry hasn’t been easy, but for years TiVo has inspired a small group of die hard fans, who’ve sacrificed their time and who’ve risked potential legal repercussions just so that they can spread the joy of TiVo in the land of Oz.

Despite all of the sacrifices made though, all was not joyful for TiVoDownUnder this holiday season. Instead of planning out Turkey dinners and unwraping presents, this small grey market TiVo reseller was dealing with Scrooge McTiVo’s legal department who shortly before Christmas, threatened the site over it’s use of their registered trademarks. Rather than fight this legal attack by TiVo Corp., TiVoDownUnder instead negotiated a little extra time to get rid of their inventory and effective January 31st, 2007, they’ve agreed to turn over their domain name to TiVo and to stop supporting the Australian market by providing hard to find refurbished TiVo units that have been modified to support the Australian power and internet infrastructure.

If TiVo was actually selling their DVR’s in Australia, I could understand why they might take issue with TiVoDownUnder using their name as part of their domain, but with TiVo being frozen out of the EPG market in Australia, it’s hard for me to see how TiVo is being harmed by letting a company sell TiVo units to a market that they legally can’t address. While, I don’t condone breaking the law, I do believe in civil disobedience when laws hurt consumers and if TiVoDownUnder was able to introduce a few Australians to the luxury of a TiVo DVR, in the long run, it would only put pressure on the Australian government to end this ridiculous ban in their country. By taking away a key contributor to the underground TiVo movement, TiVo has made it much more difficult for Australians to get their hands on a real TiVo experience at a time when Microsoft has shown they’re not afraid to muscle in, even without an EPG.

When members of the Australian community came together and started XPMediaCentre.com, Microsoft didn’t quibble over registered trademark issues, instead they had a member of their media center team go directly to the community and share some of the reasons why they couldn’t officially support the guide data. Of course, when your business model doesn’t involve making profits on your hardware to begin with, I guess it may have been too much for the suits at TiVo Inc. to keep ignoring the growing popularity of grey market DVRs in Australia.

Truth be told, TiVoDownUnder took the news much better then I did. I suppose that after spending a year dealing with unruly rivals and product shortages, they were ready to get back to their day jobs. In their blog post announcing the closing, TiVoDownUnder thanks TiVo for being flexible by giving them a month to get rid of their inventory and sounds almost happy to be done with their project. The problem is though that while TiVoDownUnder may have been a rouge business using TiVo’s trademark, they did serve a positive social function for TiVo. By importing and modifying the TiVo boxes for the Australian community, they made it easier for people to experience the joy of TiVo. While TiVoDownUnder may not have seen this legal request as an attack on their community, it still makes me sad to see TiVo pull this type of stunt without at least having their own EPG solution on the market.

Over the years, TiVo has benefited tremendously from the grassroot efforts of their fans and while I can understand why TiVo would want to protect their brand from being used by other companies, I also think that TiVo could have looked the other way in this particular case. TiVoDownUnder was never trying to capitalize on TiVo’s good name, they were just trying to fill a market void that TiVo can’t officially fill themselves.

While for now, TiVo’s action against TiVoDownUnder appears to be an isolated event, it does raise the possibility that TiVo could threaten things like OzTiVo, The TiVo Community forum, the Un(official) TiVo blog or even the frowning TiVo icon that bloggers love to use following TiVo quarterly earnings announcements, if they decide to exercise eminent domain on their registered trademarks. While technically and legally, TiVo may have the right to enforce these trademarks, going after the grassroots community that has helped to make TiVo so popular to begin with, is the wrong tactic to take.